Two of Australia’s biggest banks are backing Gina Rinehart’s favourite lithium miner Liontown Resources, signalling confidence in a pummeled sector.
Two of Australia’s biggest banks, the country’s leading export credit agency, and a clean energy financier are backing billionaire Gina Rinehart’s favourite lithium miner Liontown Resources with a $550 million loan, signalling confidence in a pummeled sector.
Evan Collis Shares in Liontown jumped 10.4 per cent to $1.45 on news of the funding, although the stock is still well down from its soaring height of $3 when the miner was the target of last year’s high-stakes takeover by US chemicals giant Albermarle. Shares ended Wednesday up 5.7 per cent at $1.39. Run by chief executive Tony Ottaviano, Liontown is nearing completion of its lucrative $1 billion Kathleen Valley high-quality hard-rock lithium deposit in the middle of Western Australia. However, a global plunge in lithium prices – the metal dubbed “white gold” due to its market value and silver colour – has thrown the sector into turmoil and forced Liontown to review the mine’s expansion plans after its lenders pulled the plug on a $760 million debt package. Earlier this year, the company said its syndicate of lenders remained “highly supportive” of Kathleen Valley and that it had started negotiations for a smaller revised debt centred around deferring parts of the mine’s expansion.China yuan currency prices for lithium spodumene have tumbled more than 80 per cent between November 2022 and now after demand for lithium batteries, the driving force behind the global electric vehicle wave, hit the shoals of slowing global EV customer growth. China’s EV exports increased 50 per cent last year, with a large portion going to Europe. Global EV and hybrid electric vehicle sales grew by 35 per cent in 2023, according to Ev-volumes.com. However, sales were up 52 per cent the year before.Hancock spent nearly $1 billion to build a strategic 19.9 per cent blocking stake in October last year and thwart US giant Albermarle’s aspirations to seize control of the miner. Since then, the value of Hancock’s holding has halved as prices crushed the sector. Liontown said the new debt arrangements will fund its mine until first production as well as the subsequent ramp-up to a “base case” output of 3 million tonnes a year. “The debt facility provides financial certainty and sufficient time for Liontown to complete the previously announced review of Kathleen Valley’s 4 million megatonne annual output,” the company told the ASX.The organisations syndicating the loan include Australia’s biggest bank, the Commonwealth Bank, National Australia Bank, French financial giant Societe Generale, Australia’s export credit agency Export Finance Australia, and the Clean Energy Finance Corporation. Kathleen Valley remains on schedule and on budget to start first production by the middle of this calendar, the company said.Core Lithium suspended long-promised works on its second BP33 mine near Darwin in December, blaming the global price crash in the metal, while the previous month, Chinese giant Ganfeng Lithium postponed plans to mine the battery metal in Mexico.
Australia Latest News, Australia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Man dies in two-vehicle crash in central west NSWA man has died in a two-vehicle crash in central west New South Wales. Emergency services were called to the Newell Highway at Tooraweenah, about 30km northwest of Gilgandra, following the crash between a truck and car about 7.20pm on Tuesday.
Read more »
Two-headed calf defies the odds after birth on US farmA rare calf born with two faces – four eyes, two noses, two mouths and two ears – continued to flourish tod...
Read more »
Gender pay gap data: Gina Rinehart blames Hancock Prospecting pay gap on ‘helping women’ into miningA 22 per cent gender pay gap at Hancock, versus a 15 per cent for all miners, is the temporary result of getting more women into the industry, Gina Rinehart says.
Read more »
Gina Rinehart, Nicola Forrest and Annie Cannon-Brookes top AFR Rich Women List in 2024The wealth of Australia’s richest 75 women soared by 30 per cent over the past year, as entrepreneurs in resources, tech, property and fashion enjoyed the fruits of a resurgent market.
Read more »
Liontown Resources' new debt deal reflects declining fortunes of Australian lithium marketThe new debt deal of Liontown Resources is worth $550 million and matures in October 2025. The company's CEO will likely seek further funding by the end of this year. The previous deal included six commercial banks, but only three have signed onto the new agreement. Government agencies Export Finance Australia and the Clean Energy Finance Corporation have also remained involved.
Read more »
LTR ASX: Liontown’s Kathleen Valley lithium project bolstered by loan involving Commonwealth Bank, National Australia Bank, Clean Energy Finance Corporation, Export Finance Australia and Societe GeneraleThe new agreement will ease concerns over Liontown Resources after January’s spectacular loan withdrawal.
Read more »