Critical Metals (Nasdaq: CRML) announced Tuesday it has finalized a deal with the Obeikan Group to form a joint venture to construct and commission a large-scale lithium hydroxide processing plant in Saudi Arabia.
The 50%/50% JV will be geared towards developing, constructing and operating the plant for the conversion of lithium spodumene concentrate from the Wolfsberg lithium project in Austria.
The deal creates a newly established Arabian New Energy company, which seeks the exclusive right to purchase spodumene mined from the current resource at Wolfsberg (Zone 1), and the facility is expected to be developed to meet the minimum initial capacity and product specifications based on Critical Metals' binding long term supply agreement with BMW.
Wolfsburg is Europe’s first fully permitted lithium mine, and although a definitive feasibility study was produced in 2023, the construction of the hydroxide plant now may be less expensive than the original DFS reported and the OPEX numbers have improved, Critical Metals CEO Tony Sage told MINING.com in an interview in March, when European Lithium merged with Sizzle Acquisition Corp to create Critical Metals.
Sage also said the Wolfsberg project, located in Carinthia, is set to become the EU’s only producing battery-grade lithium mine by 2027.
“The assignment of this JV to Critical Metals Corp represents another huge milestone for the Wolfsberg project,” Sage said in Tuesday’s news release. “Critical Metals Corp has two dedicated partners to ensure we fulfil our ambition to become the first European producer of both spodumene and hydroxide. With these key milestones having been achieved, we expect the next steps will become a lot easier.
“Over the next several quarters, we plan to update and finalize the DFS on these projects, and to secure the necessary funding to commence construction,” Sage said. “The Board of the newly formed Arabian New Energy will oversee the construction of the hydroxide plant, with funding for the project sourced from within Saudi Arabia.”
The news comes just a month after Critical Metals announced it will acquire controlling stake in world’s biggest rare earth project, Tanbreez in Greenland.
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