Galan Lithium Logo

Galan Secures Agreement with Glencore for Offtake & Financing Prepayment Facility for the Hombre Muerto West (HMW) Lithium Project

The Board of Galan Lithium Limited (Galan or the Company) is very pleased to announce that it has signed a binding term sheet with a wholly owned subsidiary of Glencore plc (Glencore) global mining and trading company, for offtake for up to 100% of its premium lithium chloride concentrate from HMW (Marketing Offtake Agreement or MOA) and the offer to provide or facilitate a secured Financing Prepayment Facility (Facility) for US$70 to US$100 million, subject to conditions precedent being met.


  • Binding offtake secured from Glencore, one of the world’s largest global diversified natural resource companies, for lithium chloride and/or lithium carbonate from Phase 1 production (see DFS ASX release 3 July 2023) at HMW
  • Glencore offers to provide or facilitate a Financing Prepayment Facility for US$70 to US$100 million, subject to conditions precedent
  • Offtake with Glencore does not require an export licence
  • The agreement endorses Galan’s low-cost low-risk lithium chloride development strategy to become the next lithium producer in Argentina
  • Discussions for the larger Phase 2 (see DFS ASX release 3 October 2023) HMW development are open and well advanced
  • As previously announced Galan has commenced construction of Phase 1 HMW in September 2023 and remains on track for first pond fill in Q1-2024
  • Commencement of production remains forecast for H1 2025

OFFTAKE AGREEMENT

Glencore will purchase technical grade lithium chloride product from Galan’s high-grade, low- impurity HMW Project in Catamarca Province, Argentina. The offtake commitment does not require Galan to have secured an export licence for its lithium chloride. Glencore will accept offtake for Galan’s lithium chloride to be toll treated into lithium carbonate for sale and export from Argentina.

The binding agreement is for a five (5) year period from commencement of commercial production for 100% of Galan’s Phase 1 production estimated at 5.4kt lithium carbonate equivalent (LCE) in lithium chloride concentrate per annum. The price payable by Glencore will be referenced to a mutually agreed lithium carbonate price index over a quotational period less a marketing fee, discount and penalties (if any).

The agreement is renewable subject to mutual agreement between Galan and Glencore.

FINANCING PREPAYMENT FACILITY

Galan is also delighted to have secured an offer from Glencore to provide or facilitate a binding proposal for the Facility to support funding of Phase 1, which is subject to certain conditions precedent being met including, amongst others, satisfactory due diligence to Glencore’s absolute discretion and draw down under the Facility will only become effective when the MOA and all transaction definitive documentation has been signed subject to Glencore’s satisfaction in its absolute discretion.

Galan believes that the execution of the binding term sheet for the MOA and Facility is a validation of the exceptional quality of the HMW Project and a strong endorsement of the experienced personnel with the requisite niche expertise which Galan has secured to successfully construct and deliver a lithium brine project in Argentina. Moreover, to underscore such confidence in the growth and future of Galan and its HMW Project, Galan and Glencore have agreed that Glencore will have first right to negotiate in respect of marketing and/or financing with regards to the future expansion of the HMW Project for Phase 2.

In parallel and whilst Galan is developing Phase 1 for maiden production at HMW in 1H 2025, the Company is also advancing discussions for the development of Phase 2 at HMW.

Galan’s Managing Director, Juan Pablo (JP) Vargas de la Vega, said:

“We are very delighted to announce Galan’s achievement of this very significant milestone on the path towards commencing commercial production at HMW in H1 2025. The agreement with Glencore is a validation of the quality our world class project and endorses the calibre and experience of Galan’s team. Our agreement with Glencore significantly de-risks our project and we are very well poised to secure finance for Phase 1 of the HMW Project. Importantly, Glencore’s funding assistance via the prepayment facility endorses our lithium chloride concentration strategy to deliver the HMW project, and provide returns to shareholders, in a shorter time frame.

We are today closer to becoming a significant and reliable producer of lithium, and thereafter growing our production in line with the expected rise in demand. Our momentum towards maiden commercial production continually strengthens and we look forward to updating investors on our progress.

We thank and acknowledge the work of our dedicated Board and personnel to reach this critical milestone. As always, we are grateful to our community and government in Argentina for their invaluable support of our development at HMW.”


Click here for the full ASX Release

This article includes content from Galan Lithium, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.

GLN:AU
The Conversation (0)
Galan Lithium

Galan Lithium


Keep reading...Show less

Developing high-grade lithium brine projects in Argentina

Galan Lithium Limited: SUCCESSFUL DUE DILIGENCE COMPLETED - $20M PLACEMENT TO PROCEED

Galan Lithium Limited: SUCCESSFUL DUE DILIGENCE COMPLETED - $20M PLACEMENT TO PROCEED

Highlights:

  • All conditions in relation to the $20 million placement to Clean Elements Fund have been satisfied.
  • Due diligence undertaken by Clean Elements Fund validates the standing of Hombre Muerto West ( HMW ) as a world class lithium project, offering exceptional scale and grade.
  • Galan is now fully funded to complete the construction of Phase 1 at HMW (at 4ktpa LCE) with first production of lithium chloride concentrate planned during H1 2026.

Galan Lithium Limited (ASX: GLN,OTC:GLNLF) ( Galan or the Company ) is pleased to announce that all conditions relating to the $20 million share placement ( Placement ) to the Clean Elements Fund ( Clean Elements ) have now been completed.

News Provided by PR Newswire via QuoteMedia

Keep reading...Show less
Successful Due Diligence Ends - $20M Placement To Proceed

Successful Due Diligence Ends - $20M Placement To Proceed

Galan Lithium (GLN:AU) has announced Successful Due Diligence Ends - $20m Placement To Proceed

Download the PDF here.

Galan Lithium Limited: Incentive Regime for HMW Project in Argentina

Galan Lithium Limited: Incentive Regime for HMW Project in Argentina

Galan Lithium Limited (ASX: GLN,OTC:GLNLF) (" Galan " or " the Company ") is pleased to advise that the Comite Evaluador de Proyectos RIGI, responsible for awarding the Argentine Government's Régimen de Incentivo para Grandes Inversiones (the incentive regime for large-scale investments referred to as the " RIGI "), has approved the RIGI for Galan's flagship Hombre Muerto West (" HMW" ) Project in Catamarca Province, Argentina . Galan now expects to receive official approvals relating to the RIGI in due course.

The RIGI is a landmark investment framework introduced as part of the Government of Argentina's new economic reform agenda, aimed at encouraging large-scale investment in key sectors, including mining. The RIGI provides long-term certainty on tax and foreign exchange regulations, as well as streamlined permitting, both critical enablers for project financing, efficient construction and operation of the HMW Project over its multi-decade life.

News Provided by PR Newswire via QuoteMedia

Keep reading...Show less
Aerial view of a brightly lit cityscape at night, with glowing street patterns and waterways.

Landsat Data Shaping Lithium-Mining Plans at Nevada’s Thacker Pass

A Nevada lithium project central to US efforts to secure domestic mineral supply is leaning on a half-century-old satellite program for modern answers.

The US Geological Survey’s (USGS) Landsat program, managed with NASA, has provided continuous Earth observations since 1972. Its freely available images allow scientists and industry leaders to measure landscape changes with precision.

In Northern Nevada, those insights are proving crucial as Lithium Americas (TSX:LAC,NYSE:LAC) works to advance Thacker Pass in a way that meets strict environmental and land-use standards.

Keep reading...Show less
Livium Expands Clean Energy Waste Recycling Capabilities

Livium Expands Clean Energy Waste Recycling Capabilities

Livium (LIT:AU) has announced Livium Expands Clean Energy Waste Recycling Capabilities

Download the PDF here.

Green Technology Metals

Green Technology Metals


Keep reading...Show less
Livium Ltd

Livium Signs Binding Term Sheet with Iondrive related to DES Technology for Clean Energy Waste Recycling

Livium Ltd (ASX: LIT) ("Livium" or the "Company") is pleased to announce it has signed a binding term sheet (“Term Sheet”) with Iondrive Limited (ASX: ION) (“Iondrive”), an Australian company developing an innovative metal extraction process using Deep Eutectic Solvent technology (DES), via their subsidiary Iondrive AU Pty Ltd.

Keep reading...Show less
Glowing digital battery icon with particle connections on dark background.

CATL Mine Restart Pressures Australian Lithium Market

Australia’s lithium sector is facing pressure on the back of news that Chinese battery giant Contemporary Amperex Technology (CATL) (SZSE:300750,HKEX:3750) is expected to resume production at its Jianxiawo mine.

Operations were halted in August when the mine’s licence expired, with the suspension expected to last three months.

Located in Yichun, Jiangxi province, Jianxiawo produces about 65,000 tonnes of lithium carbonate equivalent annually, roughly 6 to 8 percent of global supply. It is the largest mine in Yichun, often referred to as China’s “lithium capital.”

Keep reading...Show less

Latest Press Releases

Related News