Fully charged: St George nabs $3m deal with leading lithium battery producer ATL

Japanese-owned battery producer ATL will invest $3m in SGQ subsidiary Lithium Star’s seven projects in WA
ATL will acquire a 10% stake in Lithium Star with SGQ holding 90%
Five of the projects are situated in sought after lithium regions in the Yilgarn Craton
Investment will be used to fund exploration with field work planned this month

St George Mining has secured a $3m strategic joint venture with global lithium-ion battery producer Amperex Technology Limited (ATL) to fund lithium exploration in WA.

ATL is a world leader in the development and high-volume production of lithium-ion batteries and is recognised world-wide for high-quality batteries with industry leading standards in safety, power density and fast-charge technology.

The company is owned in full by Japanese, multinational TDK Corp – one of the world’s leading electronics manufacturers.

The battery giant will invest $3 million in St George Mining (ASX:SGQ) subsidiary Lithium Star which owns seven prospective hard-rock lithium projects in WA.

ATL will acquire a 10% direct equity stake in Lithium Star with St George holding the remaining 90% – with ATL able to increase its stake with further investment on terms to be agreed.

The $3 million investment will be used to fund exploration at the projects, with St George confident the strategic relationship will provide an opportunity to leverage ATL’s substantial financial and technical capabilities to maximise the value of St George’s lithium projects.

JV recognises lithium projects’ potential

“We are delighted to welcome ATL – a world leader in lithium-ion batteries – as a partner for our lithium exploration in Western Australia,” SGQ executive chairman John Prineas said.

“This strategic investment recognises the exciting potential of the seven prospective lithium projects secured by our subsidiary, Lithium Star.

“It also recognises the technical expertise and commitment of the St George team which has considerable experience in exploration for lithium, nickel and other battery metals as well as the development and operation of open-pit and underground mines in Western Australia.”

Prineas also said the deal highlights St George’s strong success in developing key industry relationships with some of the largest and most important global players in lithium-ion batteries.

“The key downstream relationships formed by St George, including with Shanghai Jayson, SVOLT, Sunwoda Electronic and now ATL, underpin our capacity to grow in the lithium sector and validate our strategic decision to build out our portfolio of battery metals projects,” he said.

The funds will be used to accelerate exploration at the following priority projects:

Split Rock: roughly 25km north-west of the Earl Grey lithium deposit, which has a resource of 189Mt at 1.50% Li2O, owned in joint venture by Wesfarmers (ASX:WES) and SQM (NYSE:SQM);
Buningonia and Buningonia North: in the same lithium province as Global Lithium’s (ASX:GL1) Manna project (32.7Mt at 1.0% Li2O) and the operating Bald Hill mine (26Mt at 1% Li2O); and
Myuna Rocks: in the lithium belt which also hosts Allkem’s (ASX:AKE) operating Mt Cattlin Mine (12.1Mt at 1.3% Li2O).

Sought after hard rock lithium address

“All the Lithium Star projects are located in Western Australia – the world’s best hard-rock lithium address,” Prineas said.

“Five of the new projects are in the southern portion of the Yilgarn Craton, an area gaining a global reputation as a ‘super province’ for lithium and already hosting three spodumene-producing mines and five others in development.

“Exploration ground in this region is highly sought after with significant M&A activity already underway to secure strategic positions.

“The investment by ATL will strengthen our ability to advance the Lithium Star projects with minimal dilution to existing St George shareholders.”

St George Mining ASX SGQ — Map of the Yilgarn Craton of Western Australia showing St George’s multiple projects in the region as well as major lithium mines and deposits. Source: SGQ.

Field exploration kicks off this month

Field exploration will commence this month at Split Rock, Buningonia, Buningonia North and Myuna Rocks.

Initial work programs comprise field mapping of pegmatites, rock chip sampling of pegmatites and geochemical sampling through soils or auger drilling.

Aircore or reverse circulation drilling will be prioritised once lithium targets are identified for drill testing.

In addition, ATL and St George are continuing discussions on the potential to collaborate on further lithium business opportunities which may include investment arrangements regarding St George’s other lithium projects in WA – as well as the potential to jointly acquire and develop new lithium projects in Australia and beyond.

This article was developed in collaboration with St George Mining, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.