Core Lithium Ltd (ASX:CXO) has awarded the Engineering, Design and Construction (EPC) contract to construct the Dense Media Separation (DMS) Plant for the Finniss Lithium Project to Perth-based Primero Group.
CXO is aiming to be Australia’s next lithium producer through the development of its flagship Finniss Project in the Northern Territory.
Finniss is just 25 kilometres from Darwin Port (Australia’s nearest port to Asia), has been awarded Major Project Status and is in close proximity to power station, gas, rail and one hour by sealed road to workforce accommodated in Darwin.
The project is fully funded after CXO successfully raised $91 million from institutional investors and $25 million from eligible Core shareholders via a Share Purchase Plan.
What Primero brings to the table
Primero is a vertically integrated engineering group with global reach through its expertise in delivering large-scale construction contracts in the lithium sector and across the minerals, energy and non-process infrastructure sectors.
Primero team has been brought on board to ensure the DMS plant performs as prescribed and to help unlock value in the project.
Primero will be responsible for:
- Project management;
- Engineering and detailed design;
- Equipment and materials procurement;
- DMS plant construction;
- Quality assurance and construction verification; and
- Ore commissioning on receipt of first ore.
Final study stage
“Today’s announcement represents the final stage of the Finniss study phase and the first step to unlocking the value of the Finniss lithium resource in the NT,” Core Lithium managing director Stephen Biggins said.
“We are excited to have Primero on board as an experienced and successful lithium EPC contractor and look forward to working together, delivering the DMS plant, creating an exciting opportunity for the people of the NT.
“As we have stated to the market, construction of the Finniss Project is on schedule to commence before the end of 2021, with Primero ready to hit the ground running immediately with initial work, in the lead-up to the commencement of process plant building activities in March next year.
“2022 is shaping up to be a defining year for Core Lithium.”
CXO and Primero have worked closely together since 2019 to deliver the definitive feasibility study (DFS) for the Finniss Lithium Project.
The execution of the EPC contract will start immediately after the Final Investment Decision (FID) with detailed engineering, procurement of long lead time equipment and securing structural steel to occur before the end of 2021.
On-site process plant construction activities are set to begin in March 2022, with DMS plant commissioning and first concentrate production anticipated in Q4 2022.
Offtake agreement in the bag
CXO has already bagged a four-year offtake agreement with Ganfeng, which has agreed to provide A$34 million in new equity, subject to Chinese Government approvals.
Gangfeng has promised to offtake 75,000 tonnes of spodumene concentrate every year from Finniss over a four-year period.