The Wesfarmers Ltd (ASX: WES) share price is pushing higher in afternoon trade.
At the time of writing, the conglomerate’s shares are up 0.5% to $58.91.
This leaves the Wesfarmers share price trading within sight of its record high of $59.63.
Why is the Wesfarmers share price pushing higher?
The Wesfarmers share price was given a boost today when the company’s Mt Holland lithium project received ministerial approval.
According to the release, the company’s Covalent Lithium business has received the Ministerial Statement under the Environmental Protection Act 1986 (WA). This outlines the conditions that apply to the construction and operation of the lithium hydroxide refinery as part of the Mt Holland lithium project.
Covalent Lithium is a joint venture company jointly owned by Wesfarmers and lithium giant Sociedad Quimica y Minera de Chile (SQM).
Following the receipt of this approval, the Mt Holland lithium project has now received all critical approvals. As a result, construction and project development have commenced.
Positively, management advised that the expected project timing and Wesfarmers’ share of capital expenditure for the project remain in line with expectations.
This means that the first production of lithium hydroxide is expected in the second half of the 2024 calendar year and Wesfarmers’ share of capital expenditure is approximately $950 million. The latter will be funded using existing cash and debt facilities.
When announcing its final investment decision earlier this year, Wesfarmers’ Managing Director, Rob Scott, stated his belief that the project was an attractive investment for shareholders.
He said: “The development of the Mt Holland lithium project presents an attractive investment for Wesfarmers shareholders. The project capitalises on our Chemicals, Energy and Fertilisers divisions’ chemical processing expertise and Western Australia’s unique position to support growing global demand for electric vehicle battery materials which will make a crucial contribution to global efforts to reduce greenhouse gas emissions.”
“We have been pleased with progress of discussions with key battery manufacturers, which reflect a positive outlook for battery quality sustainably sourced lithium hydroxide,” Mr Scott added.