Beijing set to be blocked from buying into MinRes’ WA lithium mines as Federal Government touts tough stance

Chinese suitors of mines run by Mineral Resources face a fresh warning from the Federal Government that regulatory scrutiny of foreign investment into lithium has become “tougher”. MinRes recently kicked off a sales process for the three WA lithium mines it operates — Wodgina in the Pilbara, plus Mt Marion and Bald Hill in the Goldfields. Wodgina’s ownership is split 50-50 with the US-based Albemarle. MinRes has a 51 per cent stake of Mt Marion with China’s Ganfeng holding the remainder, and the mothballed Bald Hill is controlled outright by MinRes. The Chris Ellison-led company needs an injection of cash to pay down net debt of more than $5 billion and is said to be open to a partial or full divestment of its lithium mine assets while retaining mining services contracts over the sites. Sources have told The West Australian that electric vehicle makers and lithium-ion battery manufacturers from China, Japan and Korea are the main prospective buyers. Most of the lithium produced by the three MinRes mines ends up in China. But Chinese interests, including existing mine partners and customers such as Ganfeng, face a monumental task in getting a deal green-lit by the Foreign Investment Review Board, which reports to Federal Treasurer Jim Chalmers. A spokesman for Dr Chalmers declined to comment specifically about the MinRes sales process but said the Federal Government has been “strengthening” its foreign investment scrutiny. “We’ve been strengthening and streamlining our foreign investment regime, to make foreign investment decisions much faster where we can and being tougher where we need to be,” he told The West Australian. It is understood deals involving critical minerals, like lithium, have increasingly become a regulatory focus. Dr Chalmers announced reforms to strengthen Australia’s foreign investment framework in May last year, dedicating more resources to screen foreign investment in what the Government deems to be “critical infrastructure, critical minerals (and) critical technology”. MinRes scooped up Bald Hill in 2023 after Dr Chalmers blocked the sale of the mine to a China-linked company. The Treasurer has also blocked Chinese interests taking a major stake in rare earths developer Northern Minerals. MinRes is rumoured to be eyeing at least $2 billion for its half of Wodgina and more than $550m for its 51 per cent stake in Mt Marion. It is highly unlikely MinRes would be able to recoup the $260m it paid for Bald Hill two years ago, given the lithium market’s significant downturn since the purchase. MinRes declined to comment.