Altura signs lithium offtake deal with Ganfeng

Australian lithium producer Altura Mining has signed a long-term concentrate offtake agreement with GFL International, a subsidiary of Chinese battery materials producer Ganfeng Lithium.

Starting with 8,000 dry metric tonnes during the rest of 2018, the agreement will see GFL receiving a minimum of 70,000 t/yr of 6pc grade spodumene concentrate from 2019 to the end of 2021. The concentrate comes from Altura's recently commissioned 220,000 t/yr mine and processing plant in the Pilgangoora region of Western Australia.

The agreement includes an option for GFL to extend the offtake arrangement for up to 10 years. GFL also has options to purchased additional production from stage one of Altura's project and gain access to up to 50pc of output from stage two production. A pre-payment of $11mn will be made by GFL to secure 2019 production.

Altura exported its first concentrate in October and is expected to soon announce an investment decision on doubling its output to 440,000 t/yr through the building a second stage of its processing plant. A definitive feasibility study has already been completed on the project's second stage.

Directly linked to the GFL offtake deal is a change to Altura's existing offtake agreement with China's Shaanxi J and R Optimum Energy that is having a corporate restructure. Offtake has been reduced to 50,000 t/yr from 100,000 t/yr effective from 2019.

The agreement underpins the project's production and removes offtake uncertainty, said Altura managing director James Brown said.

Ganfeng has one of the largest lithium concentrate consumption profiles in Australia through agreements with Pilbara Minerals and Altura Mining. It also owns 43.1pc of the Mount Marion lithium operation and is the offtake partner for this project.

Lithium concentrate imported by Ganfeng into China is used in its production of lithium carbonate and lithium hydroxide for the making of electric vehicle and energy storage batteries.