Mining services provider Mineral Resources (ASX: MIN) plans to sell a minority stake in its world-class Wodgina lithium project south of Port Hedland. Wodgina, which is already producing DSO lithium tonnes, has a 233 million tonne resource and a 142mt reserve. Mine and concentrator development is under way. Macquarie Capital is running the process to find partners to join Wodgina’s full development, including a lithium hydroxide or carbonate plant.
Wodgina Update and Minority Interest Sale Process
Mineral Resources Limited (ASX: MIN) (“MRL” or “Company”) is pleased to advise that it has commenced a process to sell up to 49% of its world-class 100%-owned Wodgina Lithium Project (Wodgina) as part of an offtake and partnering process.
Wodgina, 100km south of Port Hedland in Western Australia’s Pilbara region, is the world’s largest hard rock lithium deposit with an upgraded JORC (2012) mineral resource of 233 million tonnes and an inaugural probable hard rock ore reserve in Casserite Pit of 142.4 million tonnes (Mt). This reserve supports a mine life of almost 30 years at a production rate of 5.65 million tonnes per annum (Mtpa), with additional exploration upside remaining.
Please refer to the Company’s separate announcement today for further details regarding the mineral resource and ore reserve at Wodgina. MRL is currently mining direct-shipping ore (DSO) at Wodgina to provide cash flow to the Company while it progresses the Wodgina open pit pre-strip and constructs its spodumene concentrate plant that has been designed to produce 750,000 dry tonnes per annum (tpa) of 6% spodumene concentrate.
MRL, with the assistance of Hatch, is currently finalising its study into a downstream processing plant of globally significant scale at Wodgina to produce lithium hydroxide or lithium carbonate.
Mineral Resources Managing Director Chris Ellison said:
“This minority sales process is in line with MRL’s strategy of investing in early-stage projects, adding significant value and then seeking equity partners to share in the value from a full development plan.
“Wodgina is the world’s largest hard rock spodumene deposit and located close to the world’s biggest bulk commodities port, Port Hedland.
“With a resource capable of underpinning a 30 year lithium operation, Wodgina is ideally positioned to become a globally significant producer of high-grade lithium products.
“The decision to embark on a process to sell a minority interest in Wodgina will allow MRL to focus on its core strategy of being a world-leading mining services provider at the same time as having like-minded strategic partners invest with us to fully unlock Wodgina’s lithium potential.
“However, MRL will only introduce project partners if acceptable terms can be secured. MRL has the capability to finance and implement its downstream processing strategy at Wodgina on its own.”
Wodgina minority stake sales process
The commencement of a process to sell up to 49% of Wodgina follows a significant number of unsolicited approaches to MRL from interested parties including lithium processors, battery manufacturers, international trading companies with marketing capabilities and automakers expressing interest in securing a direct investment in the project and/or offtake rights.
MRL will shortly start engaging with these and other bona-fide interested parties in relation to the minority sale and offtake process.
However, MRL will only enter into a transaction if it is in the best interests of MRL shareholders. MRL’s lithium downstream processing strategy is not reliant on securing minority investors into Wodgina.
Macquarie Capital (Australia) Limited and Gilbert + Tobin have been appointed to assist MRL to manage the minority interest sale process.