MinRes to put lithium mine on ice, to cut 300 jobs
The company will put its Bald Hill lithium mine in Western Australia under care and maintenance starting this week.
A month after the federal government forced three Chinese companies to divest their stakes in three Canadian juniors with critical minerals projects, Australia’s Winsome Resources (ASX: WR1) has agreed to purchase Sinomine Rare Metals Resources’ holdings in Power Metals (TSXV: PWM).
Winsome will pay C$2 million for Sinomine’s interest in Power Metals, which holds the Case Lake project in Ontario. The transaction includes 7.5 million common shares and 7.5 million share purchase warrants. The latter are convertible into common shares on a one-for-one basis at C$0.40 per share and will expire in March 2025.
Case Lake, situated 100 km north of Kirkland Lake, hosts high-grade cesium, lithium, and tantalum mineralization, all of which are considered critical minerals in Canada and the US.
Winsome Resources shares climbed more than 13% on the news. The Quebec-focused company holds several projects in Quebec’s James Bay region.
In a release, managing director Chris Evans expressed Winsome’s excitement about the deal. “The minerals are all in high demand within North America and the rights to the offtake agreement are [a] positive step in the Winsome journey,” Evans said.
In its divestment order in early November, the federal government said it was making the move in the name of national security.
“We will act decisively when investments threaten our national security and our critical minerals supply chains, both at home and abroad,” François-Philippe Champagne, Minister of Innovation, Science and Industry, said in a news release at the time.
It is unclear why the policy targeted projects at a relatively early stage.
The government has said it aims to build a critical minerals supply chain with “like-minded partners.”
With electric vehicles on the rise, the demand for lithium is growing at an exponential rate. The International Energy Agency estimates that 60% of new car sales will have to be electric by 2030 to achieve net zero emissions by 2050.
Power Metals, which welcomed its new investor in a news release, announced the latest drill results from its ongoing drill program at Case Lake in late November. Highlights included 2 metres of 3.1% lithium oxide, 0.09% cesium oxide and 841 parts per million (ppm) tantalum from 25 metres depth in hole 149; and 1 metre of 20.25 % cesium oxide, 1.29% lithium oxide and 147 ppm tantalum from 31 metres in hole 150.
Winsome has a market capitalization of A$162.1 million. The company’s share price rose 13.6% on Friday morning to reach A$1.25.
