St George Mining secures $3m lithium joint venture deal with Amperex Technology
St George Mining (ASX: SGQ) has entered into a $3 million joint venture deal with global lithium-ion battery producer Amperex Technology to fund lithium exploration in Western Australia.
Amperex has agreed to invest the money into St George subsidiary Lithium Star, which has 100% ownership of seven hard rock lithium projects at Split Rock, Buningonia and Buningonia North, Myuna Rocks, Ten Mile West, Carnamah and Lindville.
Five of the projects are in the southern portion of WA’s Yilgarn Craton, which is becoming known as a ‘super province’ for lithium and already hosts three spodumene-producing mines and five others in development.
Exploration ground in this region is believed to be highly sought after and there is significant merger and acquisition activity being conducted by minerals companies keen to secure strategic positions.
Direct equity stake
Under the terms of the strategic joint venture, Amperex will acquire a 10% direct equity stake in Lithium Star with St George holding the remaining 90%.
Field exploration is expected to commence this month at the high priority Split Rock, Buningonia, Buningonia North and Myuna Rocks projects.
Initial work programs will comprise field mapping and rock chip sampling of pegmatites and geochemical sampling through soils or auger drilling.
Aircore or reverse circulation drilling will be prioritised once lithium targets are identified for drill testing.
New partnership
St George executive chairman John Prineas welcomed the new partnership.
“This strategic investment recognises the exciting potential of seven prospective lithium projects secured by Lithium Star and the technical expertise and commitment of our team who have considerable experience in the exploration for lithium, nickel and other battery metals, as well as the development and operation of open pit and underground mines in Western Australia,” he said.
“It will strengthen our ability to advance the Lithium Star projects with minimal dilution to existing St George shareholders [and] we look forward to potentially partnering with Amperex on additional lithium exploration and business opportunities.”
Track record
The deal builds on St George’s track record in developing key relationships with some of the largest and most important global players in lithium-ion batteries.
“The key downstream relationships we have formed with Shanghai Jayson, SVOLT, Sunwoda Electronic and now Amperex underpin our capacity to grow in the lithium sector and validate our strategic decision to build out our portfolio of battery metals projects,” Mr Prineas said.
“We are confident this strategic relationship will provide an opportunity for us to leverage Amperex’s substantial financial and technical capabilities in a way that can maximise the value of our lithium projects.”
Lithium-ion leader
Amperex is a leader in the development and high-volume production of lithium-ion batteries.
It is recognised worldwide for its superior battery quality and industry-leading standards in safety, power density and fast-charge technology.
The company is wholly-owned by Japanese electronics giant TDK Corporation, which has a market capitalisation of around $22 billion.