Kidman Resources Limited (ASX: KDR) (Kidman) and Sociedad Química Minera de Chile S.A. (SQM) have finalised and executed definitive agreements (Definitive Agreements) regarding the 50-50 Mt Holland joint venture (JV), which was announced on 12 July 2017.
Kidman acquired the historic Mt Holland goldfield 100km south of Southern Cross in December 2015 and identified Mt Holland’s lithium potential, and the Earl Grey hard-rock (pegmatite/spodumene) lithium deposit in 2016.
SQM, a Chileanhead-quartered, global integrated producer and distributor of specialty chemicals, is the world’s biggest lithium producer.
The parties intend to build a mine and concentrator at Mt Holland to produce 6% lithium concentrate, and advance the development of a refinery to produce lithium carbonate, lithium hydroxide or a combination of both.
The JV with Kidman marks SQM’s first entry into the Australian lithium sector and allows Kidman to become the only ASX-listed, Australia-focused lithium miner with a potential interest in downstream processing.
Under the Definitive Agreements Kidman and certain of its subsidiaries have agreed to sell 50% of the Kidman’s interest in the Mt Holland Project for consideration of $US30 million (payable directly to Kidman) and a commitment of SQM to sole fund the first $US80 million of expenditure in connection with the Mt Holland Joint Venture.
Work has already begun on implementing the project and establishing a working group to oversee development of the Earl Grey mine and concentrator, and to advance feasibility studies into a proposed lithium refinery.