SQM Partners with Andrada Mining for Lithium Development in Namibia

SQM has finalized an earn-in agreement with Andrada Mining to develop the Lithium Ridge asset in Namibia. This partnership marks SQM’s initial expansion into Africa and allows for up to a 50% acquisition stake in the project. An investment of $40 million from SQM is expected to stimulate project development and economic growth in the Erongo region.

Chile’s SQM (NYSE: SQM), recognized as the second-largest lithium producer globally, has secured the necessary approvals from Namibian authorities to initiate an earn-in agreement with Andrada Mining, based in South Africa. This partnership aims to co-develop the Lithium Ridge asset, which is strategically located approximately 35 kilometers from Andrada’s flagship Uis tin mine. The agreement allows SQM the option to acquire a stake of up to 50% in Grace Simba Investments (GSI), the Andrada subsidiary that possesses the Lithium Ridge license.

The approval signifies a pivotal step towards launching this potentially transformative alliance. Anthony Viljoen, the Chief Executive of Andrada Mining, remarked on the deal’s significance, asserting that SQM’s anticipated investment of up to $40 million will significantly contribute to the project’s acceleration and stimulate economic growth within the lithium-abundant Erongo region.

Andrada Mining will maintain operational control of the project and is entitled to receive a success fee if the lithium resource surpasses 40 million tonnes. This agreement represents a strategic entry for SQM into Africa’s emerging lithium market, fostering opportunities for collaborative growth and development in the region.

In conclusion, SQM’s entry into the Namibian lithium market marks a significant expansion into Africa, emphasizing a collaboration that promises mutual benefits. The proposed investment by SQM will not only enhance the project’s viability but also bolster local economic expansion. As Andrada Mining continues as the project operator, the partnership aims to develop a resource-rich area further, setting a promising standard for future ventures in the region.

Original Source: www.mining.com