The accelerating boom in demand for lithium has seen Mineral Resources (MinRes) – along with US partner Albemarle and Chinese partner Ganfeng – agree to boost output from their Wodgina and Mount Marion spodumene mines in WA.
In both cases the partners are looking at a significant expansion in the shortest possible time.
Albemarle and MinRes have decided to accelerate the resumption of production from Train 2 at Wodgina, with the first spodumene concentrate expected in July of this year
The companies said in a statement to the ASX that preparations to recommence operations at Train 1 are well underway, with first spodumene concentrate from this train now expected next month – six months faster than previously planned.
Separately Ganfeng Lithium and Mineral Resources have agreed to upgrade the ore processing capacity of their Mt. Marion spodumene project.
According to the preliminary test work results, it is estimated that the spodumene concentrate capacity of Mt. Marion will rise to 600,000 tonnes a year from 450,000 tonnes a year at present.
The joint venture is also planning the second stage of expansion, which will expand the current spodumene concentrate capacity to 900,000 tonnes a year by the end of this year.
Each train has a nameplate capacity of 250,000 dry metric tonnes of 6% product.
MRL managing director Chris Ellison said that the growing demand for lithium has been driven by the strength of the electric vehicle market.
“This demand has resulted in a substantial increase in lithium prices, with pricing expected to remain strong for the rest of this decade,” he said.
MRL and Albemarle agreed to review the state of global lithium market toward the end of this calendar year, to reassess the timing for the start-up of Train 3 and the possible construction of Train 4 at Wodgina.
MRL and its 50/50 joint venture partner Jiangxi Ganfeng Lithium (Ganfeng) agreed to upgrade the Mt Marion procession facilities, given the positive metallurgical test work results and the completion of project studies at the mine.
At Mt Marion’s the expansion beyond 600,000 tonnes a year will see a dense media separation (DMS) plant upgrade, a new crushing circuit and an upgrade to the mine camp. All this should be enough to boost output to 900,000 tonnes, or double the current capacity.
“I’m proud of the great work our team have done at Wodgina and Mt Marion. As we continue to significantly expand our spodumene supply from these Tier 1 mines in Western Australia, we look forward to creating many more long-term jobs and supporting the surrounding communities for decades to come,” Ellison said in the statement.
“With a world-class portfolio of highest-quality, long-life lithium assets in a Tier 1 mining jurisdiction, we are well-positioned to capitalise on the continued growth of the global electric vehicle market.”
Albemarle is also a joint venture partner with China’s Tianqi Lithium (and IGO) at the Greenbushes mine and processing plant at Kwinana in Western Australia.
Albemarle also has significant lithium operations in the slat brine areas of northern Argentina.
In February, MinRes and Albemarle signed a non-binding letter of agreement to explore a potential expansion of their MARBLE lithium JV.
The agreement would see ownership of the Wodgina mine change from 60:40 in favour of Albemarle, to a 50:50 JV, with MinRes to resume management of the mine.
Ownership of the Kemerton operations would remain 60:40 in favour of Albemarle, with the Kemerton operation to be fed by feed from the Greenbushes mine.
MinRes and Albemarle’s expansion plans also include a new 50:50 JV between the two companies, which would own additional lithium conversion assets outside of Australia, and would be jointly funded by the partners, with Albemarle acting as operator.
All spodumene produced at Wodgina will ultimately be processed through conversion facilities either built or acquired by a new 50:50 JV between MinRes and Albemarle, and MinRes will be responsible for contributing its share of the capital costs of this conversion capacity. Any spodumene produced in excess of JV conversion capacity will be either toll-converted or sold into the open market.
MinRes shares edged up just over 1% to end the day at $60.35.
