News: IGO UPDATE 1-Australian court orders Tianqi Lithium to pay $29 mln to court fund

(Adds details on court ruling, comments by Tianqi and MSP Engineering)

An Australian court on Thursday ordered China's Tianqi Lithium 002466.SZ to pay A$38.9 million ($29.43 million) into a court fund, as the firm appeals a disputed payment for the building of a battery-grade lithium processing plant in Western Australia.

Tianqi, one of the world's biggest producers of lithium chemicals used in electric vehicle batteries, had refused to pay Perth-based MSP Engineering for building a lithium hydroxide plant, saying the project ran over budget.

Work on the plant was stalled last year as Tianqi flagged liquidity problems due to plunging lithium prices.

Western Australia's Supreme Court had already ruled that Tianqi must pay A$38.9 million in arrears, but the company appealed that decision.

The state's appeal court said it would stay the ruling while Tianqi's appeal is heard, but Tianqi must pay the sum to the court to be held in a trust by April 9.

MSP Engineering welcomed the decision and "looked forward to Tianqi complying with this order to pay by April 9," a spokeswoman said.

MSP has had to wind down other business lines to pay its contractors and subcontractors and has shrunk its staff to four from 400 employees as it awaits payment.

Tianqi was pleased by the decision, a spokesman said, and will continue to pursue MSP under private arbitration as it focuses on rectifying issues at the plant and moving towards production.

"We expect to award significant rectification contracts shortly and look forward to producing value added lithium product here in Australia," Tianqi's spokesman said

Tianqi's assets include a 51% stake in the Greenbushes lithium mine and 100% of the Kwinana lithium plant, which was heralded as the largest of its kind.

The debt-laden company in December had secured a strategic investor for 49% of its business, paving the way for a lifeline extension on $3 billion of loans.

($1 = 1.3219 Australian dollars)