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Wesfarmer stalls A$600 million lithium project

Kitco News

(Kitco News) - Bending to the poor lithium market fundamentals, Wesfamer said Thursday it is suspending development of its Mt Holland lithium project until next year.

The lithium market has been upset by low prices. This week the other Australian lithium producer, Galaxy Resources, cut production 60%.

Wesfarmers has a definitive feasibility study for Mt Holland. The company said it will now take its time to optimize the project: reducing capital costs, upgrading road and utility infrastructure and ensuring lithium it eventually produces has right chemistry for its customers.

Wesfarmers said it will make a final investment decision in 2021.

In a corporate presentation from 2019, Wesfarmers pegged the price to develop the project at A$600 million (US$409 million). The Mt Holland lithium project is a 50:50 joint venture with SQM.

Last year, Wesfarmers acquired the Mt. Holland stake from Kidman Resources for A$776 million (US$529 million).

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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