SHANGHAI, Oct 19 (Reuters) - China’s Jiangxi Special Electric Motor Co Ltd said on Thursday it planned to buy stake in an Australian lithium mining and exploration company, the latest electric vehicle company to scoop up supplies of raw materials.
Jiangxi, which makes electric vehicles and lithium batteries, said its German division had agreed to pay A$20 million ($15.72 million) for an 11.45-percent stake in Tawana Resources NL.
Tawana has a 50-percent interest in the Bald Hill lithium and tantalum mine in Western Australia, which is expected to ship its first lithium concentrate shipment in March 2018, it said.
Tawana also owns 100 percent of the Mofe Creek project, an iron ore project in Liberia.
China, the world’s biggest auto market, said it wants electric and plug-in hybrid cars to make up at least a fifth of Chinese auto sales by 2025 and eventually phase out traditional cars part of government efforts to improve air quality.
Lithium is a key ingredient for making batteries for products like mobile phones and electric vehicles.
Tawana’s shares were halted on Wednesday pending an announcement on funding for Bald Hill.
News of this deal follows an announcement last month from Great Wall Motor Co Ltd that it will take a small stake in Australian lithium miner Pilbara Materials Ltd.
Australia was the world’s largest lithium producer in 2016, according to the U.S. Geological Survey.
China’s EV production could reach 1 million vehicles next year and 3 million by 2020, Xu Heyi, chairman of carmaker BAIC Group, said on Wednesday, likely exceeding a government set target. ($1 = 1.2721 Australian dollars) (Reporting by Ruby Lian and Josephine Mason. Editing by Jane Merriman)