Pilbara Minerals has officially approved the Stage 2 expansion of its Pilgangoora lithium-tantalum project in the Pilbara region of Western Australia.
Once necessary approvals are received and project funding is accounted for, major site works will begin at the project. The expansion will see a 3-million-tonne-per-year (mtpa) processing circuit added to Pilgangoora, pushing its total capacity to 5 mtpa.
Additionally, other engineering redesigns will push production capacity beyond 800 kilo-tonnes per annum (ktpa) of 6-percent spodumene concentrate over the mine’s 17-year lifespan. As Pilbara had already placed some long-lead orders for major equipment, the company expects to commission Stage 2 during the December quarter of 2019.
“Against a backdrop of significant demand growth for lithium raw materials over the coming decade, the quality and scale of the resource at our Pilgangoora project demands further expansion,” Pilbara managing director Ken Brinsden said in a statement.
“This will ensure it becomes a mainstay in the next generation of large-scale, low-cost mines to support the significant growth in downstream lithium hydroxide capacity.”
The company has already secured 100 percent of Stage 2’s offtake through agreements with companies like POSCO (NYSE:PKX), Ganfeng Lithium (SZSE:002460) and Great Wall Motor Company (HKG:2333). The Stage 2 expansion will be partly funded by these offtake agreements, along with “alternate finance structures” that the company is exploring.
In the meantime, production ramp-up from Pilgangoora’s Stage 1 is still continuing and going as planned, according to Pilbara. The company just sent out its first spodumene concentrate shipment from the project in early October, which consisted of 8,800 wet metric tonnes (wmt) of coarse and fines concentrate and was en route to the company’s offtake partners in North Asia.
Despite the positive news, Pilbara Minerals shares were down 3.51 percent at the end of trading on the ASX on Tuesday (November 13) closing at AU$0.825 a piece.
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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.