ioneer Ltd (ASX:INR) (OTCMKTS:GSCCF) (FRA:4G1) has awarded a major engineering and equipment contract for the Rhyolite Ridge Lithium-Boron Project in Nevada to Danish firm FLSmidth.
Under the agreement, the globally recognised major engineering multinational is set to play a large role in developing ioneer’s wholly-owned project.
FLSmidth will provide most of the crushing and material handling equipment required for work at Rhyolite Ridge, as well as rotary lithium carbonate and boric acid dryers
Ultimately, the engineer’s appointment marks a major step forward for ioneer’s lithium boron asset as it prepares to become the first new lithium chemicals producer in the US in more than 60 years.
"Significant supply package"
ioneer managing director Bernard Rowe said: “The contract with FLSmidth is one of the more significant supply packages we will award at Rhyolite Ridge and represents another step in the development of the project.
“FLSmidth is focused on providing environmentally sound engineering and technology solutions.
“This aligns with ioneer’s ambition to not only produce materials necessary for electric vehicles and renewable energy infrastructure but to do so in an efficient and environmentally responsible manner through lowered emissions, significantly reduced water usage and a small surface footprint.”
INR shares have been as much as 3.8% higher intra-day to A$0.415 while the company's market cap pre-open was approximately A$761.6 million.
FLSmidth mining president Mikko Keto said: “We are delighted to win this engineering order and we look forward to working with ioneer as it progresses development of the Rhyolite Ridge Lithium-Boron Project.
“This contract provides clear recognition of our experience, know-how, and world-class technologies for processing lithium.
“It is also important to note that our localised approach and strength in service and aftermarket were important factors for ioneer when it came to choosing a partner."
Contract details
ioneer’s engineering and equipment contract has been awarded under a limited notice to proceed, meaning FLSmidth can commence part of the work program at Rhyolite Ridge.
This is because the equipment package supply rests on ioneer’s board of directors reaching a final investment decision.
With more than 11,700 employees across the globe, FLSmidth has extensive experience providing technology, equipment, engineering and services expertise to the battery minerals sector.
The Danish multinational is active in the US and is committed to improving project efficiency while reducing environmental impacts on site.
Promisingly, the contract with FLSmidth could also open other doors for ioneer: the engineer often negotiates with financial institutions to help its customers secure project funding.
So far, FLSmidth has initiated discussions between Denmark’s credit export agency, EKF, and ioneer to discuss potential financing options.
Rhyolite Ridge
ioneer’s Rhyolite Ridge Lithium-Boron Project in Nevada is the only known lithium-boron deposit in North America and one of only two known such deposits in the world.
Recently, the ASX-listed lithium resource developer inked its first binding offtake supply agreement with EcoPro Innovation Co Ltd.
The offtake deal will run for three years, over which ioneer will provide EcoPro Innovation with lithium carbonate from Rhyolite Ridge.
Overall, the offtake agreement should account for as much as 34% of ioneer’s annual lithium carbonate output over the first three years of production.