It would appear that SQM has big ambitions for their lithium...

It would appear that SQM has big ambitions for their lithium business here in WA.

And time is of the essence here for SQM to take control of AZS so they can steer the ship with Andover's future development by incorporating it into their grand plans.

So they should pay up to achieve their objectives imo

Delays in taking control of Andover could have flow on effects on their Mt Holland and refining projects - the SQM-Wesfarmer JV were considering bidding for LTR - so that is now history , Andover is the must get deposit for them.

SQM chief executive Ricardo Ramos has indicated the increased investment in WA would come from $US3.4 billion earmarked for capital expenditure to increase lithium production.

Wesfarmers boss Rob Scott said on Tuesday that he was not worried by a dip in lithium prices in weighing up adding to what is already a $2 billion-plus investment in the Mt Holland project for the Perth-based conglomerate.

The comments from Mr Scott and Mr Ramos underscore a renewed focus on lithium assets in Western Australia, andspeculation Albemarle will have to contend with a rival bidder in its $5.5 billion pursuit of Liontown Resources.

Mr Scott said Wesfarmers was considering doubling the size of the Mt Holland mine and associated lithium hydroxide plant that is under construction and owned in partnership with SQM.

Wesfarmers announced a $700 million blow out to $2.6 billion in the costof what appears increasingly likely to be just the first stage of the project in March. The current Wesfarmers share of $1.3 billion is on top of the $776 million it paid to buy into the Mt Holland project alongside SQM in 2019.

The joint venture partners are considering upping the capacity of the concentrator at Mt Holland to 760,000 tonnes a year and the refinery capacity to 100,000 tonnes a year.

‘Just the first step’

Mr Scott said there was plenty of scope for Covalent Lithium, the joint venture entity, to expand, and indicated Wesfarmers wouldn’t be deterred by a weaker lithium spot price.

Speaking after SQM handed down quarterly results in March, Mr Ramos said building a 380,000 tonne concentrator and 50,000 tonne lithium hydroxide plant was “just the first step” in Western Australia.

“We strongly believe that we will reach an agreement [with Wesfarmers] – and we will review all the data from the engineering and the geological studies that we’re performing today – that will allow us to go forward to 100,000 tonnes or something close to,” he said.

WA lithium hopeful Liontown told the market on Tuesday that it had not received any takeover proposals, including any indicative proposals, since rejecting the Albemarle bid on March 28.

Liontown has binding off-take agreements in place with car makers Tesla and Ford, and with South Korea’s LG, for lithium from its Kathleen Valley project about 680 kilometres north-east of Perth.

Wesfarmers’ lithium hydroxide off-take negotiations have involved Tesla, LG and Mitsui.

Mr Scott said lithium spot prices were of little relevance as Wesfarmers weighed up increasing its long-term investment.

“What really matters is ensuring that you have a very competitive structure and even under a broad range of price outcomes the Mt Holland development will be one of the lowest cost producers,” he said at the Macquarie Australia conference in Sydney.

“We look at a lot of opportunities in the lithium and critical mineral space, but what we are more excited about is investing incremental capital in the Mt Holland project, where we still have a really good runway for growth.”