Chinese strategic investor places its lithium supply faith in AVZ
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Special Report: China’s Yibin Tianyi Lithium Industry Co will invest $14.1m in AVZ Minerals and negotiate a lithium offtake agreement.
The Chinese company is acquiring $14.1m worth of AVZ shares at a placement price of 4.5c each, giving it a 12 per cent stake in the company.
The two companies will also negotiate a binding offtake agreement for products from AVZ’s Manono lithium and tin project in the Democratic Republic of the Congo (DRC).
Yibin Tianyi is backed by China’s largest electric vehicle battery manufacturer – Contemporary Amperex Technology (CATL).
It is currently constructing the first phase of its lithium hydroxide plant in China that is expected to be completed by the second quarter of 2020 while a second phase expansion is expected to be completed by 2023-2024.
“We are excited to welcome Yibin Tianyi as a new, strategic investor in AVZ, especially given the backing they have from CATL – China’s largest EV battery manufacturer,” managing director Nigel Ferguson said.
“Their intention to become one of the biggest global hydroxide producers certainly complements our vision of developing the largest hard rock lithium deposit in the world.
“Yibin Tianyi’s intention to invest in AVZ and enter into a binding offtake arrangement underpins the tier 1 quality of our Manono Project.
The funds raised from this placement enables AVZ to accelerate site works and to complete early development works at the Manono Project while the DFS is being completed.”
AVZ is currently looking at completing the definitive feasibility study (DFS) in the first quarter of 2020.
It is currently carrying out the second phase of a metallurgical test work program aimed at verifying the phase 1 process flowsheet and design parameters, examine ore variability and its effect on economic performance, and produce spodumene concentrates for market assessment.
The first phase work had resulted in the “excellent recovery” of lithium, tin and tantalum.