How Will Scorpion’s USD 10M Deal with GreatPower Transform WA Lithium?
Scorpion Minerals has inked a strategic MOU with Chinese battery materials giant GreatPower, unlocking USD 10 million in staged funding to accelerate lithium project development in Western Australia.
- USD 10 million staged funding agreement with GreatPower
- Initial USD 2 million to define a JORC-compliant lithium resource
- Potential equity conversion tied to mining approvals
- GreatPower to secure up to 90% lithium offtake rights
- Plans for solar power plant to support mine operations
Strategic Partnership with a Chinese Battery Materials Leader
Scorpion Minerals Limited (ASX – SCN) has taken a significant step forward in its lithium ambitions by signing a Memorandum of Understanding (MOU) with GreatPower Nickel and Cobalt Materials Co. Ltd, a major Chinese battery materials manufacturer. This partnership aims to propel Scorpion’s lithium projects in Western Australia through critical development phases, backed by a substantial USD 10 million funding commitment.
GreatPower, with a robust track record in producing battery raw materials and a client roster including LG Energy Solutions, CATL, BMW, and Samsung, brings not only capital but also strategic expertise to the table. The collaboration signals confidence in Scorpion’s assets and management capabilities amid rising global lithium demand driven by the electric vehicle and energy storage sectors.
Staged Funding to Advance Lithium Resource and Mine Development
The funding arrangement is structured in stages, beginning with an upfront USD 2 million to support Scorpion in delivering a JORC-compliant resource estimate targeting 10 million tonnes at 1.0% lithium oxide (Li2O). Upon achieving this milestone, GreatPower will provide an additional USD 8 million to advance feasibility and mine development studies.
Importantly, the MOU outlines that GreatPower will organize further mine development funding once statutory mining approvals are secured from the Western Australian Government. This phased approach mitigates risk while ensuring that Scorpion can progress its projects efficiently toward production decisions.
Offtake Rights and Sustainability Initiatives
In return for its investment, GreatPower is set to receive up to 90% offtake rights to the lithium produced, split across the funding stages and subsequent mine development. This arrangement aligns the interests of both parties, with GreatPower positioned to secure a significant supply of lithium for its battery manufacturing operations.
Adding an ESG dimension, GreatPower has expressed interest in constructing a solar power plant to service the lithium mine’s development and operations. This initiative reflects a growing trend of integrating renewable energy solutions into mining projects to reduce environmental impact and support sustainable production.
Parallel Exploration and Future Prospects
While advancing its lithium projects, Scorpion will continue exploration activities at its gold-focused Pharos and Kirkalocka projects in the Murchison region. The company’s diversified mineral portfolio and strategic partnerships position it well to capitalize on multiple commodity markets.
GreatPower’s chairman is scheduled to visit Western Australia in early December, underscoring the commitment to this cross-border collaboration. The MOU, valid for 12 months with potential extensions, is non-binding but represents a critical step toward formal agreements and project advancement.
Bottom Line?
As Scorpion leverages Chinese investment to unlock WA lithium resources, the next milestones will test the partnership’s ability to translate funding into production.
Questions in the middle?
- Will Scorpion meet the JORC resource target to trigger the next funding stage?
- How quickly can statutory mining approvals be secured to advance mine development?
- What impact will GreatPower’s offtake rights have on Scorpion’s long-term revenue and control?
