Chris Ellison’s Mineral Resources has struck a deal with Alita Resources’ administrators to take control of the Bald Hill lithium mine in the Goldfields for $260 million.
After putting down a $123.9m deposit on the mine at the start of the month, administrators McGrathNicol said an agreement with MinRes was settled on Tuesday. The miner will pay $173.9m and settle $86.1m of secured debt.
The Bald Hill mine was owned by a subsidiary of Alita, which was placed into administration in December 2020 after the first lithium price boom screeched to a halt.
The Australian Tax Office is still investigating a legacy offtake agreement involving Bald Hill’s previous owner and Hong Kong-based Yihe Cleantech Material. McGrathNicol said the uncertainty of the tax situation led independent expert Deloitte to put a valuation on Bald Hill between nil and $94.2m.
MinRes has been running Bald Hill since November 1 and Mr Ellison has previously asserted that the price of the acquisition was immaterial. Resources Minister Madeleine King ‘acutely conscious’ of skills shortages threatening race to net-zero Rio Tinto dips another toe into lithium with Goldfields deal as the price for the battery input slumps further
At MinRes’ annual general meeting last week Mr Ellison said the miner could double production at Bald Hill to 300,000 tonnes of spodumene a year within the space of a year.
For comparison, Liontown Resources’ flagship Kathleen Valley lithium project is set to produce between 500,000tpa and 700,000tpa of spodumene concentrate. Liontown was recently the subject of $6.6 billion bid by US chemicals giant Albemarle.
Bald Hill’s infrastructure is set to form a key piece of MinRes’ rapid consolidation of lithium assets in the Goldfields.
At MinRes’ AGM Mr Ellison said the Goldfields hosts the most prospective ground in the world for hard rock lithium.
“There’s certainly a lot [of lithium] down there to be found, it’s really well under-explored,” Mr Ellison said.. Chris Ellison sheds light on Mineral Resources’ big lithium plans and takes a swipe at Andrew Forrest’s FMG
“All of the gold companies sort of sit on the ground down there and are really only interested in gold. About the middle of next year we will have probably wrapped up gathering up as much rock as we can.”
His comments followed a spree of moves by MinRes in the region, including acquiring the lithium rights to a Norseman gold project and grabbing a major stake in Delta Lithium.
Bald Hill is also near the Mt Marion operation, which MinRes owns in partnership with China’s Ganfeng.
A40 Price at posting:
8.2¢ Sentiment: None Disclosure: Held
