Namibian lithium developer and emerging lithium concentrate producer Desert Lion Energy has delivered the first shipment of product to the port of Walvis Bay in Namibia.
This is in accordance with the terms of its off-take agreement with Chinese lepidolite converter and off-take partner Jiangxi Jinhui Lithium.
The first shipment is expected to be approximately 30,000 tons of lithium concentrate material, which will generate gross revenues of approximately $3.8 million for Desert Lion Energy.
Under the terms of the off-take agreement Jinhui is required to purchase all lithium concentrate product from Phase 1 of the company’s production plan, which Desert Lion Energy estimates to be approximately 150,000 tons – 160,000 tons of lithium concentrate for the 12 to 18 month period.
Payment for this shipment has been collateralised by the delivery of an irrevocable and unconditional letter of credit by Jinhui in favour of Desert Lion Energy in an amount equal to 110% of the purchase price of the shipment.
“The delivery of the first shipment of lithium concentrate represents a significant milestone for Desert Lion Energy, which demonstrates the production chain is operational from reclaiming, sorting and processing all the way through to delivery of product to our offtake partner at the port of Walvis Bay,” comments president and CEO Tim Johnston.
“We look forward to continuing to execute this phase of production, while moving towards the production of higher value products and large-scale mining in the second half of 2018/2019.”
The company plans to publish a mineral resource estimate and preliminary economic assessment in respect of the company’s lithium project in Namibia in the second quarter of 2018.