Argosy signs lithium carbonate spot sale deal with Hong Kong buyer as Rincon gains traction

Argosy Minerals (ASX: AGY) has signed a substantial spot sales contract to supply 60 tonnes of battery-quality (greater than 99.5% purity) lithium carbonate produced at the company’s Rincon lithium project in Argentina to a Hong Kong-based chemical company.

The spot sales contract has an agreed fixed price referenced from the Shanghai Metals Market battery-grade lithium carbonate price.

Terms of delivery include free on board at the Buenos Aires port and upfront payment of a 30% deposit and the 70% balance paid prior to ship loading.

‘Strong interest’ shown

“We were pleased to receive such strong interest for the sale of our battery-quality lithium carbonate product,” managing director Jerko Zuvela said.

“With our positive project fundamentals, we will be strong beneficiaries of the EV/lithium sector resurgence, noting the significant development milestones achieved to date at our Rincon lithium project.”

“We are delighted to be part of an exclusive group of battery-quality lithium carbonate product exporters, given the challenges encountered by many of our peers attempting to achieve this feat.”

Positive turnaround

The contract is a positive turnaround after the company recently reported a net after-tax loss for the group of $15.5 million, which Argosy mostly attributed to impairment recognised on the Rincon project following an independent valuation it obtained, as well as from the group’s share of Puna Mining losses.

Foreign exchange losses made up the majority of Puna’s deficit for the year, relating to currency differences arising from converting earnings of the company’s foreign operations into Australian dollars.

Along with its 100% ownership of the Tonopah lithium project in Nevada, USA, Argosy holds a 77.5% interest in Puna Mining, which owns the Rincon project.

Argosy has the right to move to 90% ownership as consideration for funding development of the 10,000 tonnes per annum operation.