Reed Resources in talks with international firms on Mount Marion Lithium Project
Thursday, December 09, 2010 by John Phillips
proactiveinvestors.com.au
Potential domestic and international partners have approached Reed Resources (ASX: RDR) in relation to the Mount Marion Lithium Project, which when commissioned, will be the world’s second largest source of spodumene (lithium oxide) production.
Reed said it has received approaches from parties proposing various transaction structures ranging from downstream toll treatment and/or joint ventures through to outright acquisition of the upstream (spodumene concentrate) operations.
Reed has appointed Australian investment bank Gresham Advisory Partners as corporate advisers, to assist in considering its strategic alternatives.
The company did reiterate that discussions remain preliminary, with no assurances that a binding proposal will emerge, and therefore in the interim it will remain focused on obtaining approval of the mining proposal from the Department of Mines and Petroleum.
The Mount Marion Lithium Project is located in Western Australia, and is being jointly developed by Reed and Mineral Resources (ASX: MIN).
The two companies signed a farm-in agreement in October 2009, which sees Reed retaining 100% ownership of the project while Mineral Resources will fund all development costs and build, own and operate the processing facilities in order to earn a 40% share of net profit.
The project has a resource of; 10.5 million tonnes at 1.4% lithium oxide for 146,500 tonnes of contained lithium oxide.
The resource is open along strike and down dip.
The JV anticipates mobilising a processing plant and related equipment with a production rate of 17,000 tonnes per month of +6.5% lithium oxide concentrate in early 2011, subject to obtaining all necessary approvals. |
