Prospect Resources Limited (ASX: PSC), headquartered in Subiaco, Australia, is a mineral exploration company working towards evaluation and development of mineral properties (lithium and gold deposits) in Zimbabwe.
The Afrtican battery minerals company is currently accelerating works at its flagship asset, the Arcadia Lithium Project situated on the periphery of Harare in Zimbabwe, which represents a globally significant hard rock lithium resource. Prospect is currently focussed on the near-term production of petalite and spodumene concentrates at this project.
On 17th May 2019, Prospect Resources announced that the Company’s offtake partner and major shareholder, Sinomine Resource Group Co., Ltd commenced construction (on 6TH May 2019), of a battery grade lithium hydroxide plant and a significant expansion to its existing battery grade lithium carbonate plant.
Sinomine Resource Group is a Beijing, China- based company engaged in manufacturing of base metals chemicals, geological exploration as well as mining investment.
Dongpeng New Materials Co., Ltd, Sinomine’s wholly owned subsidiary, started with the phase 1 of its expansion plan focused on development of the 15,000 tpa battery grade lithium hydroxide plant at Dongpeng’s existing facility in Xinyu City, Jiangxi Province, with expected completion by August 2020. The Lithium Carbonate Equivalent (LCE) of this lithium hydroxide output is approximately 23,000 tpa. Prospect’s offtake agreement with Sinomine makes up approximately 64% of the lithium hydroxide plant’s total annual LCE requirements to reach capacity.
Currently, Dongpeng’s existing plant is producing 5,000 tpa of high purity lithium carbonate, 6,000 tpa of battery grade lithium carbonate and 3,000 tpa of battery grade lithium fluoride. When the battery grade lithium hydroxide plant is completed, Dongpeng also plans to begin with the expansion of its existing battery grade lithium carbonate plant from 6,000 tpa to 16,000 tpa. This will deliver Sinomine a total annual capacity of ~ 47,000 LCE.
With numerous industrial applications, Lithium has the highest electrochemical potential amongst all metals, a key property in its role in lithium-ion batteries which are at the centre of the global transition to renewable energy alternatives.
Also, on 16th May 2019, Prospect Resources announced that it had agreed to sell its Congo’s exploration business to New Energy Metals. The Perth-based NRG is planning to debut on the ASX this year. The sale would involve the transfer of Prospect Cobalt Pte Ltd (Prospect’s 100% owned subsidiary), and its related entities.
The consideration for the sale includes – AUD 1,000 and the costs of transferring ownership of PCP to NRG; ~ AUD 50K of new shares in NRG’s proposed seed capital placing and AUD 100K of new shares in NRG’s proposed IPO placing; plus AUD 1 million on delineation of a JORC Inferred Mineral Resource Estimate of greater than 5Mt. A net smelter royalty of 1% on any copper and cobalt products produced from existing or future projects generated by NRG in the DRC is also specified.
With around 2.05 billion outstanding shares, the PSC stock closed the market trading at AUD 0.019, zooming up 5.56% with ~ 1.21 million shares traded.
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