In a significant move that highlights the growing importance of lithium in the electric vehicle (EV) industry, an Australian company has struck a major deal with a Chinese group to supply lithium from a mine located in Angola’s Namibe province.
The agreement, valued at $10 million, involves the sale of half the lithium extracted from the Giraul field, a prominent source of spodumene mineral, which is a vital component in the manufacturing of batteries for electric cars.
Tyranna Resources, the Australian company involved, announced the successful execution of the transaction and disclosed that the Chinese firm, Sinomine International Exploration, made an upfront payment of $10 million to secure their share of the lithium supply.
Sinomine, listed on the Hong Kong stock exchange, is a well-established mining group with operations spanning over 40 countries.
The company is actively engaged in lithium processing for the production of batteries for electric vehicles, making this deal a strategic move to secure a critical resource for their operations.
Under the terms of the agreement, Sinomine will not only acquire half of the spodumene mineral from the Giraul field but also be entitled to an equal share of pollucite from the same mine.
Pollucite is a mineral containing cesium, a metal with various applications in electrical, electronic, and chemical industries.
This dual-mineral arrangement represents a mutually beneficial partnership that supports the lithium supply chain while facilitating Sinomine’s access to cesium.
Importantly, this deal has paved the way for another transaction between Tyranna Resources and Sinomine, previously announced in March.
In this upcoming venture, Sinomine will invest a substantial sum of 31 million Australian dollars ($19.5 million euros) in further exploration of the Angolan mine.
This considerable investment will not only strengthen Tyranna’s position in the lithium exploration project but also accelerate the exploration program in Angola, ensuring a more efficient and timely extraction of lithium resources.
For Sinomine, securing a reliable source of lithium from the African continent is a strategic move to capitalize on the booming Chinese EV market.
As electric cars gain immense popularity in China, local EV brands like BYD, NIO, and Xpeng have emerged, posing a significant challenge to the dominance previously held by German, Japanese, and US automakers.
President Xi Jinping’s proclamation in 2014, that the future of China’s automotive industry lies in electric vehicles, has driven the country to set ambitious targets.
China has already surpassed its goal of having electric vehicles represent 20 percent of total sales by 2025, with one in four vehicles sold in the country being electric.
The successful conclusion of this deal between an Australian company and a Chinese mining giant marks a milestone in the global lithium market.
It highlights the collaborative efforts between countries to meet the increasing demand for lithium, an essential element for the rapid growth of the electric vehicle industry.
As the electric vehicle revolution gains momentum worldwide, securing a stable supply of lithium becomes critical for countries like China, which are at the forefront of the transition to sustainable transportation.
