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Galaxy Resources (ASX:GXY), the Australian-based, advanced-level, developmental mining and chemical company focused on lithium and tantalum production, has just announced that its initial shipment of 6500 tonnes of spodumene has been dispatched through the Bunbury Port, rather than through Esperance Port as originally planned.
Galaxy Resources (ASX:GXY), the Australian-based, advanced-level, developmental mining and chemical company focused on lithium and tantalum production, has just announced that its initial shipment of 6500 tonnes of spodumene has been dispatched through the Bunbury Port, rather than through Esperance Port, as originally planned. Galaxy Managing Director Iggy Tan said the company is still working to finalize shipping arrangements at Esperence. Mr. Tan said the Mount Cattlin facility is now operating at 70 percent of design capacity.
The company’s primary focus has been a hard rock spodumene lithium project called Mount Cattlin, near Ravensthorpe, Western Australia, encompassing a mine and minerals plant. Galaxy also intends to establish a downstream lithium processing facility in China. Galaxy also holds a portfolio of several projects in Western Australia and in Canada at various stages of exploration and development, mainly covering lithium and tantalum, but also other commodities, including uranium, gold, nickel, iron ore, copper and rare earths.
Resource expansion
On March 22, Galaxy announced that recent drilling, modelling and evaluation have increased reserves at Mount Cattlin by 14.6 percent, or 2.31 million tonnes from the previous estimate, while the measured and indicated mineral resource was up 12 percent, or 1.50 million tonnes to 13.8 million tonnes. The previous resource estimates were issued in January 2010 and Mr. Tan said the recent announcement extends the potential mine life of the spodumene project to 18 years, including inferred resources. Drilling during 2010 focused mainly on the North West Zone, which accounts for the bulk of the resource increase. Some infill drilling was completed in other areas to extend known mineralized zones or upgrade resource categories.
Listing delay
Earlier this month, following the earthquake and tsunami in Japan, the company announced the postponement of its proposed initial public offering (IPO) in Hong Kong until further notice, due to “unfavourable financial market conditions.” Mr. Tan said that whilst the Company is very disappointed to have to delay its Hong Kong IPO, it is a prudent decision in light of serious international events and related market volatility. “Given the Company’s strong financial position, we saw no necessity to launch the IPO in a market environment that would not serve the interests of either existing shareholders or deal participants.” Last November, Galaxy Resources announced its intention to list on the Hong Kong Stock Exchange and develop a strategic foothold in Asia to move towards a vertically integrated business model and production and marketing of E-Bike lithium batteries. The expectation is for long term investors to potentially benefit from higher operating margins.
The company had initially expected to begin shipping lithium late last year, but delays in receiving approvals from the Esperance Port and unexpected operational impediments at Mount Cattlin forced Galaxy to revise its timetable in mid December. At the time the company said it would begin shipping early in 2011, but that was then subsequently revised to “late in the Q1 2011” in the company’s last quarterly report. Galaxy has also delivered its first shipment of tantalum concentrate by product to Global Advanced Metals Pty Ltd under its five-year sales agreement with the private company. The shipment of 28 tonnes had an average grade of 2.3 percent tantalum pentoxide.
Sustainable energy award recognition
Galaxy Resources has also just received the Energy and Distribution Award in Perth this week for its considerable achievement by the Sustainable Energy Association of Australia. The site at Mount Cattlin uses solar panels on a solar tracker which follows the sun’s movement in the sky generating 15 percent more solar electricity than fixed systems. The company has 2 wind turbines and 14 relatively large solar trackers in operation at Mount Cattlin which together generate 226 MWh per year of renewable energy.
This project is expected be the first mine site in Australia that is completely powered by renewable energy sources within the next three years. At present about 10 percent of the power requirement of the mine is met by green energy and the expectation is to meet all operational power demands by 2014.
Mr. Tan said that the company was proud to be a part of efforts to get the mining industry to use more renewable energy for its electricity needs. He added that the Australian Federal Government’s proposed carbon tax will see an increased interest in renewable energy sources within the industry.
