Fears that rapidly rising production from Australia is undermining the global lithium price boom are not stopping the local industry from continuing its pell mell charge into the market.
In 2017 WA lithium sales reached $780 million and the sector employed more than 1,200 people, according to the WA government with the figure this year to be weill over $1 billion in exports.
Liontown Resources says its Kathleen Valley lithium project on the WA goldfields has an initial resource of more than 20 million tonnes of ore and is starting to attract global interest.
Liontown’s presentation came as Altura Mining opened its 100% owned Pilgangoora lithium mine in the Pilbara, while Australian companies such as Orocobre based in Argentina are grappling with a new export tax imposed by the government at the weekend to try and stabilise a shaky economy.
Liontown said metallurgical test work in progress, moving towards a scoping study in the final quarter of this year.
In a filing with the ASX yesterday (http://www.ltresources.com.au) Liontown said the deposit, 60km north of Leinster, has a maiden resource of 21.2 million tonnes at 1.4% lithium and 170 parts per million tantalum, with an estimated 75% in the measured and indicated categories. The company also said it had a second lithium discovery at Buldania near Norseman which is also on the WA goldfields.
The company hopes to have a resource figure for this deposit by the end of this year.
CEO David Richards said the company is planning to start discussions shortly with potential off-take partners. He said the company had fielded interest from potential offtake partners and end users in China, South Korea and Chile and noted the company was expected to enter production after 2020.
Meanwhile Altura’s Pilgangoora lithium mine is located 90 kilometres south-east of Port Hedland and will produce about 220,000 tonnes per annum of lithium spodumene concentrate.
The company is considering plans to double production to tap into growing global battery demand for electric vehicles and storage.
The Pilgangoora lithium deposit currently has an ore reserve estimate of 41.1 million tonnes and the mine took just 18 months to construct.
The mine is in the same area as Pilbara Mining’s producing mine, which ships out of Port Hedland.
In late August Pilbara announced it had executed a $US15 million working capital facility and foreign exchange hedging facility with French bank, BNP Paribas and secured approval for a $A19.5 million concessional loan from the Australian Government’s Northern Australia Infrastructure Facility.
Both will help finance investment in the second stage of the Pilbara’s Pilgangoora Lithium-Tantalum project.
Meanwhile Orocobre Limited updated the market yesterday on the new export taxes imposed by the struggling Argentinian government.
“A temporary special export duty will be immediately applied to all exports of Orocobre’s 66.5% subsidiary Sales de Jujuy SA (SDJ) and Borax Argentina SA (Borax) up to 31 December 2020 at a rate of AR$ 3 for each US$ 1.
“Based on the current ARS: USD exchange rate an export duty of AR$ 3 for each US$ 1 equates to a duty of approximately 8% on export sales revenue from SDJ and Borax. The ongoing rate of this special export duty may vary depending on the currency exchange rate between AR$ and US$.
“Since April 2018 the Argentine Peso has devalued by approximately 90% against the US$, with devaluation now running ahead of Argentine inflation (see Annexure 1). Currently 45% of SDJ’s costs of production and 60% of Borax’s costs of production are ARS$ denominated. Consequently, the Company anticipates that the increase in export duties will be counterbalanced to some extent by the recent rapid devaluation of the Argentine Peso and the positive affect that this will have on production costs for both SDJ and Borax.
“Orocobre remains committed to its previously announced plans for the Olaroz Stage 2 expansion and the Naraha Lithium Project,” the statement read.
