European Lithium, Obeikan Group to boost lithium processing in Saudi Arabia

European Lithium Limited (ASX: EUR, FRA: PF8, OTC: EULIF), a key player in the lithium industry, has announced a significant advancement in its global strategy by signing a Shareholders Agreement with Obeikan Group for Investment Company. This partnership is set to establish a state-of-the-art lithium hydroxide processing plant in the Kingdom of Saudi Arabia, leveraging the spodumene concentrate produced from European Lithium’s Wolfsberg Lithium Project in Austria.

The joint venture, which will operate on a 50%/50% basis, aims to develop and commission this large-scale processing facility. This initiative aligns perfectly with the long-term supply agreement European Lithium has with BMW, detailed in an announcement on December 21, 2022. This agreement grants Arabian New Energy, the newly formed joint venture company, the exclusive rights to purchase spodumene from Wolfsberg’s Zone 1. The plant is designed to meet the initial capacity and product specifications required under this binding agreement.

European Lithium and Obeikan Group form strategic joint venture, aiming to revolutionize lithium processing in Saudi Arabia for a sustainable future.

Tony Sage, Executive Chairman of European Lithium, expressed his enthusiasm about this development: “This is another huge milestone for the Wolfsberg project following the recent $US15 million commitment made by BMW. We now have two very dedicated partners to ensure we fulfill our ambition of becoming the first European producers of both spodumene and hydroxide. Now after these key milestones have been achieved, the next steps become a lot easier. Over the next two quarters, we expect to finalize the updated DFS on the now-separated projects and secure the necessary funding to commence construction.”

The terms of the Shareholders Agreement include the establishment of a Development Committee to oversee all key decisions related to the development of the plant. Additionally, upon successful commissioning, Wolfsberg Project Zone 1 will supply lithium spodumene concentrate to the JV company throughout the life of the mine’s current resources at a pre-agreed rate with specified price limits.

Abdallah Obeikan, CEO of Obeikan Investment Group, highlighted the strategic importance of the agreement: “We are pleased to have reached this agreement with European Lithium. Our partnership will combine the solid technical expertise of European Lithium and its affiliates with the industrial knowledge of Obeikan and the strength of Saudi Arabian financial markets. It is a strategic global collaboration to achieve the goals of Vision 2030 and to advance the development of the new industry in the Kingdom of Saudi Arabia.”

This partnership not only signifies a major step towards Saudi Arabia’s Vision 2030 goals but also positions European Lithium and Obeikan Group at the forefront of the rapidly evolving global lithium market, enhancing their capabilities in renewable energy resources.