AMA forms joint venture to produce lithium after tantalum prices collapse

When Perth-based Alliance Mineral Assets (AMA) listed on Catalist in July 2014, it was focused on mining for tantalum, a rare metal used to produce electronic components found in devices such as mobile phones. But the price of tantalum fell sharply early this year, forcing the company to scale back its operations. Now, it claims to have found signi ficant deposits of lithium at its mining tene ment. Lithium is used to produce batteries that power mobile phones as well as electric cars produced by companies such as BYD Co and Tesla Motors.

“We were forced into a corner, and now we have much more,” says executive director Simone Suen in an interview with The Edge Singapore. Now, by producing lithium and tantalum concurrently, AMA expects to be able to operate profitably despite the steep fall in the price of tantalum. Its depressed shares may also draw the attention of traders after the steep rally in shares in ISR Capital, which has announced plans to acquire a 60% stake in a rare earths concession in Madagascar. ISR Capital has yet to complete the transaction.

AMA began production last December, just over a year after listing. It also has an offtake agreement with Mitsubishi Corp, one of the largest Japanese trading houses. However, the price of tantalite, from which tantalum is extracted, slumped to just US$65 a pound in April this year, from US$100 a pound last November. With prices at such low levels, officials at AMA say its Bald Hill Project in Western Australia was barely breaking even.

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