....the reality is that Aussie lithium miners need more capital and working capital to keep operations going under current malaise pricing for lithium. MinRes to inject $150m into struggling lithium mine Mark WembridgeResources reporter
Jun 16, 2025 – 8.00pm
Heavily indebted Mineral Resources will pump $150 million into its struggling Mt Marion Lithium operation to keep it afloat through the commodity’s extended downturn, according to a filing by its Chinese partner.
Ganfeng Lithium will also help bail out the West Australian project with a $150 million collateral-free loan to be matched by joint venture partner MinRes, according to a statement to the Hong Kong Stock Exchange.
The Chinese group said in the filing that the Mt Marion venture posted a $44.6 million loss in 2024 and its operations remained in the red for the first quarter of 2025.
Loss-making MinRes confirmed it would match Ganfeng’s $150 million, but did not clarify whether the money was a loan or a contribution to the joint venture.
Ganfeng said its funds would be “mainly used for the daily operation” of Mt Marion while MinRes said it would “primarily fund capital expenditure, including mine development and processing plant upgrades”.
MinRes said the $150 million would be sourced from its working capital reserves and would not increase its debt.
The injection of cash into its troubled lithium venture comes as the miner’s balance sheet totters under the weight of $5.8 billion in debt while its market capitalisation languishes at $4.6 billion.
A series of scandals linked to its founder, Chris Ellison, and troubles with its flagship $3 billion Onslow Iron project have dragged MinRes shares down 60 per cent over the past year.
The decision to plough more cash into the diversified miner’s struggling lithium operations comes as the price of spodumene falls further from its recent lows to $US580 a tonne, according to S&P Global.
Lithium traded above $US8000 per tonne roughly two years ago but fell precipitously as a glut of the metal from mines in Africa and China hit the market. The slowdown in demand for electric vehicles has also weighed on the key battery material.
Macquarie analysts noted that Mt Marion was “running with potential negative operating cash flow”, with estimated production and shipping costs of $US745 per tonne. The share prices of all ASX-listed lithium operations are down this year, Macquarie noted, except Liontown Resources.
MinRes, Australia’s largest crushing contractor and a major iron ore producer, is rumoured to be considering the sale of lithium assets – including a stake in its Wodgina operations – to shore up its balance sheet despite previously dismissing such talk.
Mt Marion is located in a lithium hotspot around Kalgoorlie-Boulder in Western Australia’s Goldfields region that includes MinRes’ mothballed Bald Hill and Liontown’s Buldania project. MinRes in October paused its plan to extend its Mt Marion mining operations underground.
“Decisive action to lower costs ensures our two largest lithium sites remain well-placed to continue to operate through the cycle and to capitalise when prices rebound,” MinRes said on Monday.
Albemarle, a joint venture partner in Wodgina, has pressured the Perth-headquartered miner to cut production until the price of lithium recovers.
In its statement to the Hong Kong Stock Exchange, Ganfeng valued Mt Marion’s net assets at $561 million and flagged concerns about the mine’s future.
“The deterioration of the international economic environment in the future may lead to a decline in the prices of lithium and lithium products, which will cause Mt Marion Lithium’s performance to fall short of expectations,” Ganfeng said.
Ganfeng said its $150 million loan had an interest rate of 7 per cent to be paid quarterly by Mt Marion over five years.
In its interim results, MinRes said it produced 100,000 tonnes of 6 per cent lithium spodumene equivalent from Mt Marion, at an average shipped cost of $US667 ($1027) per tonne.
MinRes is not the only Australian lithium producer to shut its plants to ride out the storm. Others include Core Lithium, which suspended operations at its Finniss mine in the Northern Territory; Liontown, which wound back production at its Kathleen Valley mine; and Pilbara Minerals, which paused operations at its Ngungaju ore processing facility.
Albemarle has mothballed a lithium hydroxide processing train at Kemerton and Arcadium, the world’s third-largest lithium company, shut its Mt Cattlin project.
