Creasy-backed Azure soars on $20m SQM deal
WA’s lithium play continues to gain momentum with global giant SQM – also the co-owner of the Mt Holland project with Wesfarmers – broadening its investment and supply horizons.
Azure Minerals, the West Australian lithium explorer backed by billionaire prospector Mark Creasy, has locked in Chilean group Sociedad Química y Minera as a new cornerstone investor and offtake partner.
SQM, as the New York-listed company is known, is the largest lithium producer in the world and a supplier of other chemicals. It will invest $20m to purchase 80 million new shares in Azure, and become its largest investor with a 19.99 per cent stake.
Azure currently counts Mr Creasy’s Yandal Investments vehicle as its biggest investor with some 52 million shares, while Germany’s Delphi holds close to 47 million shares. Yandal is also an 8 per cent stakeholder in $11bn ASX-listed lithium player IGO, indicating Mr Creasy’s broader interest in lithium, as demand soars for critical minerals essential to meet significant global decarbonisation efforts.
IGO earlier this week teamed up with its Chinese joint venture partner, lithium giant Tianqi, to buy minnow Essential Minerals for $136m, targeting its Pioneer Dome lithium project in WA.
Azure shares rose 33 per cent, or 7c, to close at 30c on Wednesday. However, shares have fallen from highs of almost 50c in the last 12 months alone.
SQM is attracted to Azure and Mr Creasy’s jointly-owned Andover development in the Pilbara. Under the deal, Azure will supply a quarter of its share of lithium from the project to SQM.
SQM is separately in a joint venture with Wesfarmers in the Mt Holland lithium project, with the mine and associated refinery at Kwinana to produce 50,000 tonnes of lithium hydroxide.
Tony Rovira, Azure’s managing director, said the company welcomed SQM’s investment in its development, “which demonstrates their strong interest and belief in the lithium potential of the Andover Project”.
“This is a significant milestone … and is a strong endorsement of Azure and our projects by one of the world’s leading lithium producers,” he said.
“The new relationship will allow Azure to draw upon SQM’s technical expertise in pegmatite-hosted lithium exploration, project development, production and marketing, providing Azure with strong support as we look to develop the Andover lithium assets.
“Azure is now in a very strong financial position and … will have a cash balance of more than $25m which will be used to accelerate lithium exploration.”
The group is expected to fast-track a maiden lithium-focused drilling program in the first quarter of this year with nickel exploration and mine development studies on the Andover and Ridgeline deposits also continuing through 2023.
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