Canada’s Lithium Americas outbids CATL for Millennial

Canada-based Lithium Americas will buy Argentina-focused Millennial Lithium for $400mn, beating offers from China's top power battery producer Contemporary Amperex Technology (CATL) and key lithium producer Ganfeng Lithium.

Ganfeng offered to acquire Millennial for around C$353mn ($280mn) in mid-July, which CATL outbid with an offer of C$377mn at the end of September.

Millennial is developing the Pastos Grandes and Cauchari East lithium production projects in a part of Argentina that is contained in the Lithium Triangle. Pastos Grande has pilot production facilities and measured and indicated resources equivalent to 4.1mn t of lithium carbonate, according to a feasibility study by Millennial. The Cauchari East project is currently seeking drilling permits.

Increasing profit margins resulting from a rise in lithium feedstock costs and a burgeoning electric vehicle market have accelerated investments in the industry, with firms trying to secure more lithium resources and competing for quality resources.

Prices for spodumene — a raw material for lithium carbonate, which is a key component in lithium-ion batteries — have soared in response to tight supplies and robust demand. Australian mining firm Pilbara Minerals drew the highest-ever bid of $2,350/dry metric tonne (dmt) for spodumene in its third online auction on the Battery Materials Exchange platform in October, underlining the persistent shortage of supplies globally.

Argus assessed 99.5pc grade lithium carbonate prices at Yn195,000-203,000/t ex-works yesterday, an increase of 294pc from the start of this year.

Lithium Americas is developing the Cauchari-Olaroz lithium brine project in Jujuy, Argentina and Thacker Pass, Nevada mining project in the US. Ganfeng is the largest shareholder in Lithium Americas. Cauchari-Olaroz has a planned capacity of 40,000 t/yr of lithium carbonate equivalent (LCE) for the first phase and no less than 20,000 t/yr of LCE for the second phase, with it scheduled to complete most construction work this year and start trial production in 2022.