AVZ signs big offtake deal with Chinese for Manono
CHINA’S largest lithium compound producer, Ganfeng, is reported to have signed up for 30% of planned concentrate production from AVZ Minerals’ 60%-owned large scale Manono project in Democratic Republic of Congo.
The deal covers up to 160,000t of spodumene concentrate, with pricing specifics not disclosed.
The deal will “greatly assist (AVZ) in meeting any conditions precedent that are required for our prospective financiers”.
The 20-year Manono project has estimated capital costs of US$545 million, a net present value of A$1.6 billion (after tax) and an internal rate of return of 33%.
AVZ said it was finalising other offtake agreements for its planned lithium products plus tin and tantalum production.
AVZ has an option over a further 15% of the project, while the DRC government owns 25%.
Shares in AVZ moved sharply higher after the deal was signed, with the company capitalised at $444 million at the price of 15.5c the stock was being traded at this week.
