Lithium Power International Ltd.'s 51%-owned joint venture company Minera Salar Blanco SpA entered into a nonbinding memorandum of understanding with Chilean state-owned miner Codelco to develop the Maricunga Salar lithium project in Chile.
The companies will negotiate a definitive agreement to form a new joint venture and finalize the environmental approval process and ongoing negotiations with potential financing and strategic partners.
The start of construction is targeted for the first half of 2020, according to an Aug. 1 release.
Lithium Power CEO Cristobal Garcia-Huidobro said consolidating the mining concessions would include an option to increase production capacity and extend the mine life beyond its expected 20-year span.
A definitive feasibility study for Maricunga in January outlined a posttax net present value, discounted at 8%, of US$940 million, an internal rate of return of 26.7% and a 3.5-year payback period on a 50% leveraged basis.