Eramet is in talks to sell minority stakes in its Centenario lithium project in Argentina and its interest in the Weda Bay nickel operation in Indonesia, the French miner said on Monday, as part of efforts to shore up its finances. The company is looking to bring in cash without giving up control of either asset.
The move follows Eramet’s flagging earlier this year of a possible capital increase and asset sales as it searched for new funding sources. Centenario, in Argentina’s Salta province, uses direct lithium extraction and currently has capacity of 24,000 tonnes a year of lithium carbonate equivalent. Eramet says the resource could eventually support 150,000 tonnes a year, but the buildout is capital hungry: a near term expansion adding 11,000 tonnes carries a price tag of about $350 million, and longer term studies cover two further facilities of 50,000 tonnes each.
Bringing in a partner at project level is a form of project financing. The incoming investor helps fund construction in exchange for a share of future output and profits, which eases the call on Eramet’s own balance sheet and, if the proceeds are large enough, reduces the size of any equity raise.
In parallel, Eramet has agreed to sell its undeveloped Arizaro lithium concessions in Argentina for $71 million, with the deal expected to close by the end of the year. The pattern is consistent: monetise non core and minority positions in the lithium and nickel portfolio while keeping operatorship of the producing and near producing assets.