Global to buy IGO's Nova asset

Processing solution will see nickel-copper plant retooled for Manna lithium mine

IGO has resolved to sell its Nova copper-nickel operation when production winds down for A$7 million in cash and shares to Global Lithium Resources. Global is putting the finishing touches on a definitive feasibility study for the Manna development located about 170km from Nova's Fraser Range address and expects the processing plant and associated infrastructure will offer substantial cost and permitting savings compared to a greenfield development. Nova will initially be used for crushing and sorting to fast-track early direct shipping ore sales, while work is underway to retool the existing processing infrastructure to support spodumene concentrate production before the end of 2027.Nova, which was discovered Sirius Resources more than a decade ago and later purchased by IGO, comes with a 1.8 million tonne per annum sulphide concentrator, a 500-bed operating camp, existing tailings storage capacity, a 26.6 megawatt power station, sealed airstrip, borefield and a water treatment plant.

An integration study is due to be completed by the end of September. Global managing director Dr Dianmin Chen said the acquisition was a landmark moment for the company, positioning it to rapidly capitalise on the forecast rise in demand for lithium offtake. He said the DSO phase could fund the bulk of the pre-production capital expenditure for the main development.

Work last year outlined a A$439 million capex to support a 1.8Mtpa project at Manna, 110km from Kalgoorlie, producing 236,470tpa of SC5.5 for an initial 14 years, with open pit mining for the first eight years. The greenfield plant was expected to cost $158 million. ConsiderationThe consideration to IGO is split between $3 million in cash, including a $1 million deposit, $2 million in Global shares escrowed for 12 months, and $2 million in cash after 12 months.

The payments will be funded from Global's existing cash with the company securing a US$75 million offtake prepayment for 40% of planned production from Chinese group Lopal earlier this year. Mining at Nova is expected to wind down by mid-December, around the time Global hopes to take a final investment decision on Manna. If the Nova deal does not close, A$10 million in liquidated damages could be payable in limited circumstances.

A new life"Finding a pathway to repurpose the valuable infrastructure at Nova is a great outcome, both for our shareholders and for the local community that has supported Nova throughout its life," IGO managing director Ivan Vella said. "Enabling the development of another critical minerals project here in Western Australia is exactly the kind of outcome we want to see and reflects our commitment to a more sustainable mining industry. "IGO's Forrestania nickel assets were earlier sold to Medallion Metals for conversion into a gold plant.

Its main remaining asset is its 24.99% share in the giant Greenbushes mine, one of the largest hard rock lithium mines in the world. Global shares have traded between 17.5c and 69.5c over the past year. The stock was up 7% today at 47.5c, capitalising the company at $132 million.

IGO's stock was up 4% on the news at $6.98, valuing it at $5.2 billion. It has traded between $4.10 and $10.05 over the past year.