Dazhong Mining and Wanhua Chemical plan to build a lithium salt production facility with an annual output of 200,000 tons in Meishan, Sichuan

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On March 23, Dazhong Mining announced that it plans to cooperate with Wanhua Chemical (Sichuan) Battery Materials Technology Co., Ltd. to invest in the construction of a lithium salt production facility with an annual output of 200,000 tons, located in the Meishan High-Tech Industrial Park in Sichuan. The overall capacity planned for this project is 200,000 tons of lithium salts, with construction carried out in three phases: Phase 1 will have an annual production capacity of 30,000 tons, Phase 2 will yield 70,000 tons per year, and the long-term goal is to reach an annual production capacity of 100,000 tons. Among them, the total investment for phases 1 and 2 amounts to 2.2 billion yuan, while the investment for phase 3 is funded through the cash flows generated by the operations of phases 1 and 2. The announcement states that in order to advance the implementation of the project, Dazhong Mining intends to sign a joint venture agreement with Wanhua Battery Materials Company in order to jointly invest in establishing a joint venture company that will serve as the entity responsible for investing in and building the first phase of the project, which aims to produce 30,000 tons of lithium salts per year. The registered capital of the joint venture is 300 million yuan, of which Dazhong Mining contributes 240 million yuan in cash (holding 80% of the shares), while Wanhua Battery Materials Company contributes 60 million yuan in cash (holding 20% of the shares). According to the announcement, as of now, the first mining area of Sichuan Jia Da Lithium Mine operated by Dazhong Mining has an recorded resource volume of 1.4842 million tons in terms of lithium carbonate equivalent – this area accounts for only one-tenth of the total exploration area covered by the mining rights. The initial mining capacity for raw ore is 2.6 million tons per year; once fully operational, it will be possible to produce around 50,000 tons of lithium carbonate per year, indicating a solid foundation in terms of lithium resources. Dazhong Mining stated that Wanhua Chemical, as a leading global chemical company, is accelerating the development of projects related to battery materials such as lithium iron phosphate, in an effort to create its second source of growth. The partnership between the company and Wanhua Battery Materials Company will leverage Wanhua Chemical’s strengths in research and development, technology, and management in the chemical industry to create a lithium salt factory with cutting-edge technology ； By establishing a stable supply-demand relationship, it is possible to jointly withstand market fluctuations, create a healthy, high-quality, and sustainably developed ecosystem, and further strengthen the company’s competitive position.