Yihua Group Lithium Industry Revenue Share of Lithium Salt Suppliers Who Want to Build International Influence

On June 15th, Dongmidixiongying of Yahua Group(002497) revealed that the company's newly built lithium salt production line in Ya'an is fully advancing civil engineering. The relevant machinery and equipment required for the project have basically completed reservations. It is expected that the first 10,000 tons of production line will be completed in 2018. Trial production, Another 10,000 tons of production line will be completed in 2019.

Yahua Group was formerly a state-owned enterprise established in 1952. Later, after the restructuring of the company and the transformation of the joint-stock system, it successfully landed in Zhongxiaoban in 2010 and became the only listed civilian explosion company in Sichuan Province. Through the forward-looking layout in recent years, the industrial and market layout of the most prosperous areas in the future has basically been formed. The company will continue to promote the sustainable development of the blasting business and continuously consolidate its position in the civilian explosion industry. In 2017, the company ranked the top five in the gross domestic product of the civil explosion production enterprise group.

Yahua Group began to intervene in the lithium industry in 2013 and currently has three lithium salt production sites in Sichuan Guoli, Zhongyi Lithium and Xingyi Lithium. Sichuan Guoli and Xingsheng Lithium Industry is an enterprise that started lithium salt production earlier in China. It is an important lithium salt production enterprise in China. Its development prospects are better and its products are of good quality. In particular, the production capacity and market of lithium hydroxide are relatively large. In the basic lithium salt manufacturing has accumulated rich experience, technical reserves and customer resources, the comprehensive competitive advantage is obvious, and established a good cooperation relationship with many domestic and foreign quality customers.

At present, the company has formed a two-wheel drive development strategy for the civilian explosion and lithium industry, which has transformed the civilian explosion industry into an internationally competitive civilian explosion industry group, and has transformed the lithium industry into a lithium salt supplier with international influence.

Yahua Group's lithium industry achieved a total operating income of 698 million yuan in 2017, an increase of 101 % year-on-year, and its share in the total operating income has gradually increased to 29.6 %, and its net profit has reached 84 million yuan, an increase of 65 % year-on-year.

In the area of lithium resource protection, the company expands the supply of raw materials through multiple channels to ensure the production of existing production lines and the expansion of subsequent production lines of the lithium business. There are currently major trilogy:

1, and the Galaxy lithium industry signed a lithium concentrate off-take agreement. From 2018 to 2019, the company purchased 100,000 tons of lithium concentrate per year from the Galaxy lithium industry, and the minimum annual procurement volume from 2020 to 2022 was 120,000 tons. It is one of the company's important raw material protection channels for lithium salt production in the future.

2, to obtain Lijiagou Lithiumite preferential supply rights. Dexin, a wholly-owned company owned by the company, owns the mining rights of Lijiagou Lithiumite Mine. According to the "Cooperation Agreement" signed by the company and the <LOCATION::1> Group, it can invest in Lithiumiye(Lixin Mining) in the future mining and processing. Lithium concentrate, According to the same market price priority to meet the company's control of Sichuan Guoli production. After exploration by the Sichuan Provincial Bureau of Geological and Mineral Exploration and Development, the Lijiagou Lithium-pyroxene mine discovered a total of 40,361,172 tons of ore resources, equivalent to 512,185 tons of lithium oxide resources. The cooperation between the company and Chuannengtou will speed up the mining process of the mine. At present, the project has been carried out on the website of the Jinchuan County People's Government in May 2018. The environmental impact evaluation of the 1.05 million t/a mining project in Lijiagou Lifeierite Mine, Jinchuan County, Sichuan Province was released for the second time. " At present, full preparations are being made for the preliminary preparations for the construction of the mine.

3, to participate in Australian Core Company and sign a lithium ore purchase agreement. Yahua International, a wholly-owned subsidiary of the company, and Li Industry, a wholly-owned subsidiary of Core, signed the "Offtake Agreement" for lithium mines. Yahua International will sell lithium mines for the future development of the Phinis project based on the market price, and the other lithium mines of Core. The project has priority cooperation rights. This will certainly become the company's future lithium production of one of the important raw material protection channels.

In addition to the above, Dixiongying said the company will continue to look for other resources to protect the needs of future lithium production.

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