PERTH (miningweekly.com) – Lithium miner Galaxy Resources has struck a $280-million deal with Korea’s Posco to divest of its tenement package in the northern area of the Salar de Hombre Muerto, in Argentina.
The package of tenements is north of Galaxy’s Sal de Vida project, which hosts an estimated 4.09-million tonnes of lithium carbonate equivalent resource, and 1.14-million tonnes of reserves.
Galaxy said on Tuesday that the northern tenement package is estimated to host some 1.58-million tonnes of measured and indicated resources, and 2.54-million tonnes of total lithium carbonate equivalent resource.
Galaxy chairperson Martin Rowley told shareholders on Tuesday that proceeds from the transaction would be used to develop the Sal de Vida project.
“This transaction with Posco provides a substantial cash injection, which underpins the development of Galaxy’s Sal de Vida brine project. The development of Sal de Vida, as a 40-year mine life product producing the equivalent of 25 000 t/y of battery grade lithium carbonate, will be based on the 100% retained reserves and will not include any of the estimated resource contained in the tenements being sold to Posco,” said Rowley.
Meanwhile, Galaxy and Posco will also enter a cooperation agreement to maximise the potential development, operational, infrastructure and logistical synergies for their respective projects.
“With the geographical coverage of Galaxy and Posco’s tenements spanning across both Catamarca and Salta provinces, this transaction is also strategically significant as it means there will now be two new lithium projects developed concurrently on the Salar del Hombre Muerto, with obvious benefits for all stakeholders in the region,” Rowley said.
The transaction is subject to the completion of definitive documentation and Posco board approval, which is expected in the third quarter of this year.