Galan Lithium advances Phase 2 offtake talks for Hombre Muerto West project
Galan Lithium (ASX: GLN) is advancing the offtake partnering process for the Phase 2 production stage of its wholly-owned Hombre Muerto West lithium project in Argentina’s Catamarca province.
The process follows the announcement last week of a five-year offtake agreement with Glencore for Phase 1 of the project, which is based on an annual production level of 536,700 tonnes of lithium carbonate equivalent (LCE) in the form of lithium chloride concentrate.
A positive Phase 2 definitive feasibility study in October increased the overall production rate to 20,851 recoverable tonnes LCE contained in a concentrated lithium chloride product for a period of 40 years.
Phase 1 capital expenditure up to the start of commercial production in the first half of 2025 has been estimated at $177.5 million.
It will be followed by a $465.3 million investment for Phase 2, part of which will be funded from Phase 1 production.
The Phase 2 offtake talks are being led by Galan managing director Juan Pablo Vargas de la Vega and director Daniel Jiminez.
Mr Jiminez was employed for 28 years by Galan partner Sociedad Química y Minera de Chile, during which time he formulated the commercial strategy and marketing of the company’s industrial products.
He was responsible for an estimated $1.34 billion worth of sales in 2018.
The process will seek to attract a well-respected partner in the lithium brine space, while locking in competitive terms and securing solid finance and funding options.
It will run in parallel to the project’s permitting activities.
Phase 2 discussions
Mr Vargas de la Vega said he was pleased with the progress of Phase 2 discussions.
“The interest in our project remains high and highlights the strength in the long-term lithium market,” he said.
“Discussions are advancing in parallel with the construction of Phase 1 and the permitting process which is continuing with the support of the Catamarca government and local communities… we are confident we will secure a strategic partner for Phase 2 in the near future.”