Mineral Resources and Ganfeng Lithium mutually terminate conversion agreement for spodumene concentrate from Mt Marion 

Mineral Resources (MinRes) and Ganfeng Lithium (Ganfeng) announced the early termination of the conversion agreement from 1^st June 2023, in which Ganfeng produced lithium compounds from spodumene concentrates produced at MinRes’ Mt Marion mine. MinRes has also removed its guidance for between 19-21.3kt battery grade lithium compounds to be produced in its 2023 financial year, and states that no payments under the original agreement will be made in the 2023 calendar year.   

The conversion agreement lasted for roughly 15 months after being signed in February 2022, with MinRes reporting record earnings from lithium hydroxide sales under the agreement in 2022. MinRes will continue to supply spodumene mineral concentrates to Ganfeng, though these will be priced at the prevailing market prices. This is expected to give MinRes greater exposure to the spot prices for spodumene concentrates which have remained high despite weakening lithium carbonate prices in the Chinese domestic market in H1 2023.    

Termination of the conversion contract has coincided with the completion of construction at the expanded Mt Marion processing facility which is undergoing commissioning in June. The expanded Mt Marion plant is expected to have a capacity of 900ktpy spodumene concentrate (mixed grade) once commissioned, equivalent to roughly 600ktpy spodumene concentrate grading 6.0% Li­₂O.