Many market watchers expect lithium demand to surge. With that in mind, it’s worth being aware of the top Australian lithium stocks.
It’s an interesting time in the lithium space, with many market watchers expecting demand to surge in the coming years due to the metal’s use in lithium-ion batteries, which power electric cars.
Most analysts would agree that Australia is on track to lead in lithium production for the next few years. In fact, Australia is the world’s top producer, while Chile and Argentina take second and third place.
With that in mind, it’s worth being aware of which Australian lithium stocks are out there and how they are performing. Read on to learn about the five top Australian lithium stocks by market cap. Data for this article was gathered on TradingView on July 24, 2019.
1. Mineral Resources (ASX:MIN)
Market cap: AU$2.89 billion; current share price: AU$15.50
Perth-based Mineral Resources is a leading mining services provider, with a particular focus on the iron ore and hard-rock lithium sectors in Western Australia. The company’s current lithium projects include Mount Marion and Wodgina lithium.
The Mount Marion lithium project, which is located in Kalgoorlie, Western Australia, is jointly owned by mining companies Mineral Resources and top lithium producer Jiangxi Ganfeng Lithium (OTC Pink:GNENF,SZSE:002460). The asset was initially expected to produce 206,000 tonnes of spodumene concentrate per year, but a current upgrade project is underway to increase production to 450,000 tonnes of all-in 6 percent spodumene concentrate per year.
In December 2018, the company entered a 50/50 joint venture with top producer Albemarle (NYSE:ALB) for its Wodgina hard-rock mining lithium project, which will produce spodumene concentrate and, in the future, lithium hydroxide. Wodgina, considered the world’s largest hard-rock lithium deposit, has a JORC mineral resource of 233 million tonnes and an inaugural probable hard rock reserve in the Cassiterite pit of 142.4 million.
2. Pilbara Minerals (ASX:PLS)
Market cap: AU$854.81 million; current share price: AU$0.49
Pilbara Minerals owns 100 percent of the world-class Pilgangoora lithium-tantalum project, which the company says is one of the biggest new lithium ore (spodumene) deposits in the world, with a globally significant hard-rock spodumene resource.
The current mineral resource estimate for the asset comprises a total of 226 million tonnes grading 1.27 percent lithium oxide (lithia) and 116 parts per million tantalum pentoxide (tantalite) and 0.6 percent iron oxide, meaning there are 2.86 million tonnes of lithium oxide and 57.7 million pounds of tantalum pentoxide.
The company declared commercial production in April following sustained output and quality of spodumene concentrate from Stage 1 at Pilgangoora during the previous six months. Pilgangoora’s Stage 3 will see processing capacity expand to 7.5 million tonnes per year, delivering an average of 1.2 million tonnes of 6 percent spodumene concentrate over an estimated 15 year mine life.
3. Kidman Resources (ASX:KDR)
Market cap: AU$767 million; current share price: AU$1.89
Lithium developer Kidman Resources, together with joint venture partner SQM (NYSE:SQM), is focused on its Mount Holland lithium deposit in Western Australia, which includes the Earl Grey deposit.
According to a combined mineral estimate published in March 2018, Earl Grey’s lithium resources stand at 189 million tonnes at 1.5 percent lithium oxide, containing 6.49 million tonnes of lithium carbonate equivalent.
Kidman made news headlines this year when it announced diversified company Wesfarmer (ASX:WES,OTC Pink:WFAFF) was looking to acquire all its outstanding shares in a takeover deal valued at AU$776 million.
4. Orocobre (ASX:ORE)
Market cap: AU$742.75 million; current share price: AU$2.85
Orocobre is building a substantial Argentina-based industrial chemicals and minerals company through the construction and operation of its portfolio of lithium brine, potash and boron projects and facilities.
Orocobre, in partnership with Toyota Tsusho (TSE:8015), has built the Olaroz lithium-producing facility in northern Argentina, which is the world’s first commercial lithium brine operation built in approximately 20 years. The company’s recently announced Stage 2 Olaroz expansion will add 25,000 tonnes per year of lithium carbonate production capacity to reach 42,500 tonnes per year (at full production and capacity).
Additionally, Orocobre and Toyota Tsusho are finalizing plans to jointly develop a 10,000 tonne per year lithium hydroxide plant in Fukushima, Japan with expected operating costs of US$1,500 per tonne.
Demand for lithium hydroxide, a key raw material used in li-ion batteries, is forecast to increase due to the expected adoption of higher nickel cathodes in batteries for electric cars.
Aside from Olaroz, Orocobre owns Borax Argentina, an established Argentine boron minerals and refined chemicals producer, and a 35 percent interest in Advantage Lithium (TSX:AAL,OTCQX:AVLIF).
5. Galaxy Resources (ASX:GXY)
Market cap: AU$556.27 million; current share price: AU$1.38
Galaxy Resources owns lithium production facilities, hard rock mines and brine assets in Australia, Canada and Argentina. The company wholly owns the Mount Cattlin mine in Ravensthorpe, Western Australia, which is currently producing spodumene and tantalum concentrate, as well as the James Bay lithium pegmatite project in Quebec, Canada.
Galaxy is advancing plans to develop the Sal de Vida lithium brine and potash project in Argentina, which the company says has excellent potential as a low-cost brine-based lithium carbonate production facility.
The asset has a maiden JORC-compliant reserve estimate of 1.1 million tonnes of retrievable lithium carbonate equivalent and 4.2 million tonnes of potassium chloride (potash or KCI) equivalent, which supports total annual production over a 40 year period.
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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.