AVZ Near Term Furture, page-85

Weihua is currently acquiring a lithium deposit (75%) at about 150% premium for AUD$195m. The lithium deposit has 6.54Mt @ 1.29% Li2O, is valued at AUD$2,100/ton for lithium resources. It will be mined at 405ktpa, for 14.7 years of mining life.

Avz is currently valued at $29/ton for JORC lithium resources.

That would not be enough for Huayou's acquiring Bamo Tech (contracting 25kt LCE in 2024).  Huayou seems have already got a potentital customer. Will Weihua source future spodumene from Manono?





Weihua Co., Ltd. and Bamo Technology signed an agreement for the purchase of 84,300 tons of lithium salt
2019.06.18 14:39:38 Yangtze River Nonferrous Metals


On June 16, Weihua Co., Ltd. (002240) issued a notice stating that the company and Bamo Technology signed the "Strategic Cooperation Agreement" on June 15, 2019 on the lithium salt business cooperation.

According to the content of the agreement, Tianjin Bamo Technology intends to purchase lithium carbonate such as lithium carbonate and lithium hydroxide from Weihua under the capacity planning of Weihua from 2019 to 2024. It is estimated that the annual procurement volume will be 2019 to 2024 respectively. It is 300 tons, 10,000 tons, 10,000 tons, 18,000 tons, 21,000 tons, 25,000 tons, and a total of 84,300 tons in 5 years.

Within the above-mentioned total annual procurement scale, the procurement plan and the structure of the purchased products shall be determined by the parties on a quarterly basis.

In response to this cooperation, Weihua said that Bamo Technology has R&D, production and sales capabilities in the fields of ternary materials, and the demand for lithium salt raw materials is huge. The company and its wholly-owned subsidiary Zhiyuan Lithium Industry are in lithium carbonate and hydrogen. Lithium oxide and other lithium salts have advantages.


Bamo Technology is mainly engaged in lithium battery cathode materials, and the high-tech research and development lithium battery research institute (GGII) ranks eighth in the top 10 rankings of ternary cathode materials companies' research and output. At present, Bamo Technology's lithium cobalt oxide capacity is 10,200 tons / year, ternary material capacity is 4,000 tons / year, high nickel product capacity is 2,000 tons / year, the main customers are LG Chemical, Samsung, BYD, ATL, CATL, etc. .

The lithium salt business of Weihua's subsidiary Zhiyuan Lithium has become its new profit growth point. In 2018, Zhiyuan Lithium Industry realized revenue of 249 million yuan and net profit of 37.908 million yuan. Weihua Co., Ltd. achieved 5,631.98 tons of lithium salt production, a year-on-year increase of 488.25 tons. The production and sales increased by 3,491.14% and 2,871.91%, mainly due to the release of the company's Zhiyuan lithium industry during the reporting period.

In addition, Weihua is still vigorously adding the lithium salt business, and plans to acquire a 100% stake in Shengyu Lithium Industry for 923 million yuan, thereby indirectly holding a 75% stake in Oyino Mining. After the mining tax certificate was obtained by Oyino Mining , the election was conducted . The lithium concentrate will be used for the production of lithium salt products in Zhiyuan Lithium. It is expected that the planned capacity of 40,000 tons of lithium salt will be completed by the end of 2019.

GGII believes that the current subsidies have fallen sharply, the competition in the lithium salt market has intensified, and the high-end capacity with resources and quality assurance can occupy the market advantage. At the same time, the industry expects that the demand for lithium carbonate will be close to 400,000 tons in 2020, and the nickel battery in the power battery is high. Under the trend, the demand for lithium hydroxide is also rising, and the overall trend is upward.

For this cooperation, for Weihua, the long list signed with Bamo Technology is a common form of cooperation, which can better bind downstream customers and reduce the risk of market fluctuations. At the same time, the second phase project of Bamo Technology Chengdu is expected It was put into production in 2019, and it is essential for the stable supply of lithium salt for expansion.