In relation to the supply of lithium hydroxide, the company has entered into a binding head of agreement with Mitsui & Co., Ltd. It is for an initial term of two years, plus 2 further two-year extension options. The agreed volume by Kidman will increase gradually and equate to less than 15% of Kidmanâs share of nameplate production from the Refinery of 22.6kt per annum. The essential commercial elements of the arrangements are binding and is covered under the Heads of Agreement. By 30 June 2019, the parties have agreed to enter into a definitive supply agreement. Either party will have the option to terminate the Heads of Agreement based on pre-agreed conditions, if a definitive supply agreement is not executed by that date.Â Â
To take discussions ahead in relation to a potential spodumene offtake agreement covering any excess spodumene concentrate, produced from the Mt Holland Lithium Project that is not required for the Refinery, the parties have also agreed. With the aim of securing further binding contracts that will in total cover approximately 75% of Kidmanâs share of production in the early years of the project, Kidman is continuing discussions in relation to further offtake agreements with high quality counterparties. Kidman will provide further updates to the market in due course. Kidman is being advised by Greenhill & Co and Maddocks.
The company has also recently entered into a funding term sheet with its joint venture partner in the Mt Holland Lithium Project Sociedad Quimica y Minera de Chile S.A. SQM has agreed to provide Kidman with a US$100 million capital expenditure debt facility after the funding term sheet, to partially fund Kidmanâs share of construction of the Mt Holland Lithium Project and a US$10 million facility to fund Kidmanâs share of JV cash calls prior to the receipt of SQMâs outstanding milestone payments.
The parties have agreed to consolidate the remaining studies in addition for the Mine & Concentrator and Refinery into two integrated project studies and have also agreed to consequential amendments to the Mt Holland JV agreement. The term sheet is subject to the parties entering into legally binding agreements and covers the essential commercial elements of the arrangements, which the parties are targeting on or before 31 December 2018.
Kidman Resources Limited (ASX: KDR) has surged up 9.013% and traded at a market price of $1.270 as at November 2, 2018. Over the past 60 months, the stock has seen a performance change of 441.86%.
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people.Â Kalkinemedia.comÂ and associated websites are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.