The Australian company, Galan Lithium Limited, announced the signing of a memorandum of understanding (MoU) for an offtake prepayment with Chengdu Chemphys Chemical Industry Co., related to the production of lithium products from the Hombre Muerto West (HMW) project, located in Catamarca, Argentina.
By Panorama Minero
With the formalization of the definitive agreements, Galan will supply Chemphys with a total of 23,000 tonnes of lithium carbonate equivalent (LCE) in the form of lithium chloride during the first five years of Phase 1 production. In turn, Chemphys will provide Galan with a prepayment credit line of US$40 million to facilitate the ongoing development of this phase of the project.
Galan’s Managing Director, JP Vargas de la Vega, stated: “I am delighted with this outcome. The high-purity, low-impurity lithium chloride samples that Galan has been producing at the HMW pilot plant have been very well received by lithium converters, leading to this agreement with Chemphys. Chemphys is a leader in lithium product processing in China and a trusted partner for some of the world’s largest battery manufacturers. This offtake partnership and the prepayment financing will be foundational agreements for the HMW project and for Galan. We look forward to executing the definitive agreements and further advancing the development of HMW, with the aim of commencing lithium chloride production in the second half of 2025.”
Chemphys Director, Alison Dai, added: “Chemphys is pleased to reach this first milestone with Galan. For our company, the quality of lithium supply and the visibility of the supply chain are crucial. Galan is an excellent partner for Chemphys in these areas, and we look forward to maintaining a strong relationship.”
Since 1998, Chemphys has established itself as a leading company in high-purity lithium chemicals and technology. Its founder was instrumental in introducing spodumene to China in the 1990s and has been at the forefront of producing battery-grade lithium and high-purity products, qualified by leading global battery material customers. Chemphys' proprietary lithium processing technologies include direct lithium extraction, direct precipitation, and electrochemical processes. According to the company, Chemphys has interests in lithium companies with projects in Argentina, including the provinces of Salta and Catamarca.