Galan Lithium (GLN) has announced a new partnership with China’s Chengdu Chemphys Chemical Industry. The companies signed a Memorandum of Understanding (MOU) which includes an advance payment of $40 million. This agreement enables Chemphys to acquire 23,000 tonnes of lithium carbonate equivalent (LCE) from Galan’s Hombre Muerto West project in Argentina.

The MOU is valid for five years. The Hombre Muerto West project, valued at $104 million, is currently under construction in Catamarca province and 40% complete. Production is expected to begin in the second half of 2025. Galan’s production will start at 5,400 tonnes per year of LCE in the first phase, with a potential increase to 60,000 tonnes per year in a fourth phase.

Juan Pablo Vargas de la Vega, CEO of Galan Lithium, highlighted Chemphys’s reputation for processing lithium products and its partnerships with leading battery manufacturers. The agreement temporarily places on hold an unsolicited offer from the U.S. startup, Energy Exploration Technologies (EnergyX), which valued the Hombre Muerto West and Candelas projects at approximately $150 million.

Previously, Galan and Chemphys had established an advance payment offtake agreement with Lithium South through the Hombre Muerto North project. Furthermore, Galan has secured another agreement with the Swiss company Glencore, allowing for direct negotiation on prices.

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