Lithium Australia said on Monday it signed a deal with Mineral Resources (MinRes) to form a joint venture and develop a pilot plant that would produce lithium iron phosphate to be used in electric vehicle batteries.
Iron ore producer MinRes will solely fund the development and operation of the pilot plant in Queensland with a total budgeted cost of AUSD 4.5 million (USD 2.96 million) and provide raw materials at no costs to the company, Lithium Australia said.
The deal includes Lithium Australia contributing its patented LieNA technology, which can improve lithium extraction yields by up to 50%, and managing the pilot plant’s production process.
Lithium Australia is the second lithium developer moving to add value in lithium iron phosphate after the board of Australia’s biggest independent lithium producer Pilbara Minerals last week approved plans to build a trial plant.
Australian lithium companies are looking to add value along the processing supply chain to capture greater margins.
Depending on the results of the pilot plant, both companies will form a 50:50 joint venture to own and commercialise the LieNA technology.
Shares of Lithium Australia jumped 45.5% to AUSD 0.048 by 0051 GMT, while MinRes was up 0.4%. (USD 1 = 1.5214 Australian dollars)
