Infinity Lithium Corporation Ltd (ASX:INF) has increased its ownership to 75% from 50% in the San Jose Lithium Project in Spain.
The increase was the result of a successful renegotiation of the joint venture agreement with local partner Valoriza Mineria S.A.
Partner Valoriza Mineria is a mining contractor and has retained preferred contractor rights in the renegotiation ensuring alignment of goals and focus on project development.
READ: Infinity Lithium Corporation boosts market expertise ahead of San Jose feasibility study
Infinity’s CEO and managing director Ryan Parkin said: “Infinity is delighted to announce the progression of project ownership to 75% as we enter a period of increasing engagement of potential strategic partners and move towards the delivery of the San Jose Lithium Project pre-feasibility study.
“European lithium-ion battery supply chain developments have recently accelerated.
“The ability to continue to align our goals to work collaboratively with our JV partners in progressing commercial discussions with key European and other industry participants provides immediate value to the project.
“The resulting acceleration in project ownership reflects the alignment of the project towards lithium hydroxide opportunities and the relevance of that product in one of the world’s largest electric vehicle markets”.
Renegotiation driven by change from lithium carbonate to hydroxide
Movement from lithium carbonate to lithium hydroxide pathway has driven renegotiation of the joint venture.
Under the original June 2016 JV agreement with Valoriza Mineria, Infinity was able to earn-in to a 75% interest through the delivery of a feasibility study on lithium carbonate production with an agreed budget of €2.5 million.
Valoriza Mineria was the preferred contractor for all works within the feasibility study and had completed some work including land access, public relations, and environmental baseline studies.
€1 million in staged payments until mid-2020
The revised JV agreement terms now enables Infinity to assume 75% interest through the immediate payment of €250,000 and additional ongoing payment commitments totalling €750,000 payable within 14 months or by 13 May 2020.
Notably, Infinity retains the right to forgo subsequent staged payments, revert to 50% project interest and earn-in to 75% through the delivery of a lithium chemicals feasibility study.