Infinity Lithium Corporation Ltd (ASX:INF, FRA:3PM) is on schedule to produce battery-grade lithium hydroxide and carbonate from testing at its Spanish project later this year despite a challenging year.
INF’s 75%-owned San José Lithium Project (SJLP) represents the European Union’s second-largest lithium deposit and is set to become an essential component in the EU’s development of a vertically integrated lithium-ion battery supply chain.
Lab-scale testing to crystallisation stage
Working with INF’s technical partners Dorfner Anzaplan in Germany, test-work continued throughout the 2021 financial year under phase one of the project agreement.
Laboratory-scale feasibility testing progressed to the crystallisation stage after progressing through roast, leach and solution purification stages. The test-work was on a kilogram scale.
Larger-scale feasibility work which was begun in Q1 2021 has progressed to sufficient flotation concentrate to undertake scaled-up roasting test-work.
The first lab-scale production of lithium hydroxide is expected no later than Q4 2021.
Read: Infinity Lithium delivers maiden battery-grade lithium hydroxide during San José test-work
LG MoU: 10,000 tonnes for five years
In June 2021 Infinity signed an offtake non-binding Memorandum of Understanding (MoU) for long-term supply of battery-grade lithium hydroxide with major South Korean lithium-ion battery producer LG Energy Solution (LGES).
The key terms of the MoU are:
- The MoU referred to the potential supply of LiOH for an initial 5-year period with the potential to continue for a further five years;
- First right to 10,000 tonnes per annum of product with additional volumes under the MoU subject to negotiations and agreement between Infinity and LGES; and
- The purchase price for the product will be based on the market prices for lithium hydroxide, subject to agreement by the parties and to be finalised under the terms of a binding offtake agreement.
Infinity and LGES are working towards finalising the binding offtake agreement within 12 months of signing the MoU. A formal agreement will be contingent on the successful commercial production of a product that meets the specification requirements of LGES.
Read: Infinity Lithium inks offtake MoU with LG Energy Solution for San José lithium hydroxide
Legal challenges from regional government
Infinity Lithium encountered legal challenges to their Investigation Permit Valdeflórez (PIV) research permit granted by the Junta de Extremadura – the regional government for the SJLP – when it was unexpectedly cancelled and reverted to application status in April 2021.
Infinity still holds the larger Investigation Permit Ampliación Valdeflórez (PIAV) which encompasses the area around the PIV grant.
The company considers the Junta’s resolution to cancel the PIV ‘in direct breach of the law and in contradiction of previous rulings by the Junta on the environmental and urban legality and viability of the PIV’.
INF has assembled a ‘high calibre and experienced legal team’ led by Madrid founded and national leading legal firm Pérez-Llorca to advise and represent Tecnología Extremeña Del Lito SL (TEL), Infinity’s Project joint venture partner.
TEL lodged an administrative appeal disputing the validity of cancelling the PIV application which was subsequently rejected in July 2021.
Infinity Lithium’s managing director Ryan Parkin and executive director Remy Welschinger spent considerable time in-country after the original notification from the Junta, assisting with the action plan to see the PIV resolved.
They met with key stakeholders in Spain to facilitate the appointment of in-country consultants to assist the legal team.
Corporate activities
Infinity undertook multiple funds-raising placements and board changes during the 2021 financial year.
Placements:
- A$4.5 million placement and entitlement offer successfully completed in September 2021; and
- A$15 million placement successfully completed in February 2021.
Board changes:
- Appointed Remy Welschinger as non-executive director July 2020;
- Remy Welshinger transitioned to executive director as head of corporate development January 2021; and
- Vincent Ledoux-Pedailles resigned as executive director August 2020
- Jon Starink joined board as executive director October 2020.
Infinity’s consolidated entity cash position as of June 30, 2021, was $19,134,704, a significant increase from 2020’s $627,953.
Net assets increased from $2,436,329 in 2020 to $27,220,500 in 2021 largely due to successful capital raising activities.
Net working capital, being current assets less liabilities, has increased from a deficit of $533,826 in 2020 to a surplus of $18,025,832 in 2021.