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- Pilbara Minerals’ (PLS) partly-owned joint venture (JV) company, POSCO Pilbara Lithium Solution Co, secures a US$460 million (A$683 million) debt facility
- The money provides the balance of the total funding required to develop and commission a lithium hydroxide monohydrate chemical facility in South Korea
- The construction of the facility is underway, with the commissioning of the first 21,500-tonne-per-annum train scheduled for late-2023
- The loan agreements were executed with both the Korea Development Bank and the Export-Import Bank of Korea
- PLS shares are down 6.18 per cent, trading at $4.25 at 11:48 am AEDT
The POSCO Pilbara Lithium Solution joint venture, in which ASX-listed Pilbara Minerals (PLS) holds an 18 per cent interest, has secured a US$460 million (A$683) debt facility.
The loan agreements were executed with both the Korea Development Bank and the Export-Import Bank of Korea.
The funds provide the remaining 60 per cent of the forecast costs required for the development and commissioning of a 43,000-tonne-per-annum (tpa) lithium hydroxide monohydrate chemical facility in South Korea.
Pilbara Minerals will be the sole supplier of spodumene concentrate to this new facility, with the company to provide up to 315,000 tpa of concentrate.
The construction of the facility in Gwangyang, South Korea, began last year, and the first 21,500 tpa train is scheduled to begin commissioning in late-2023.
The commissioning of the second train is scheduled for the March quarter of 2024.
Pilbara Minerals’ Managing Director and CEO Dale Henderson said PLS was “delighted” the JV had secured the funding from “leading Korean banks on commercially favourable terms”.
“Our 18 per cent interest in the POSCO Pilbara JV (with an option for Pilbara to increase to 30 per cent) represents a key element of Pilbara Minerals’ downstream processing strategy, enabling the company to become an integrated lithium raw materials company,” Mr Henderson said.
“Building on our strong relationship with POSCO, we are delighted to be jointly establishing a strong foothold in South Korea’s emerging battery materials industry at the doorstep of established major battery manufacturers.”
Each JV participant already contributed a share of the equity funding, with Pilbara Minerals’ initial 18 per cent equity participation funded through a $79.6 million, five-year convertible bond agreement provided by POSCO.
As such, the debt facility is non-recourse to Pilbara Minerals, with the security provided by the POSCO Pilbara JV and limited to the land, building, plant and equipment of the chemical facility.
PLS shares were down 6.18 per cent, trading at $4.25 at 11:48 am AEDT.
