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Galan Lithium (GLN.AX) has announced a significant partnership with Glencore, securing an offtake agreement for up to 100% of lithium chloride production from its Hombre Muerto West (HMW) project’s Phase 1 operations. Additionally, Glencore will provide a prepayment finance facility ranging from US$70-100 million.
This landmark deal marks a pivotal step for Galan Lithium in its journey to become a leading lithium producer in Argentina by the first half of 2025. Glencore, a global leader in natural resources, will purchase technical-grade lithium from the HMW project, located in Catamarca province, Argentina.
The agreement, which spans the initial five years of production, estimates an annual output of 5,400t LCE. Glencore’s purchase price will align with a mutually agreed lithium carbonate price, adjusted for any fees or penalties.
Galan Lithium is also in talks with Glencore for additional offtake from the prospective Phase 2 production line. The proposed Phase 2 is expected to significantly increase production capacity and financial returns, with an NPV of US$2 billion and an IRR of 43%.
The HMW project benefits from its prime location in South America’s ‘Lithium Triangle’, known for high-grade, low-impurity lithium brine deposits. Galan Lithium’s managing director, Juan Pablo Vargas de la Vega, expressed that the Glencore agreement is a testament to the project’s quality and the team’s expertise.
With the support of the local community and government in Argentina, Galan Lithium is well-positioned to secure the necessary finance for Phase 1 and deliver shareholder returns in a shorter timeframe.
Company Website: https://galanlithium.com.au
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