Pilbara Minerals looks into spodumene market

By IM Staff
Published: Thursday, 14 December 2017

Pilbara Minerals hopes to become the next spodumene lithium producer in 2018, which is when it plans to bring its Western Australia Pilgangoora project online.

Australia’s Pilbara Minerals Ltd hopes to capitalise on booming demand for lithium by bringing onstream its Pilgangoora lithium-tantalum asset next year.

Pilbara Minerals acquired Pilgangoora, situated in the Pilbara region in the north of Western Australia, from Global Advanced Metals Pty Ltd (GAM) in 2014 with the aim of developing it as a longer-term project.

The opportunity to do so arose during talks between the two parties about the sale of GAM’s Tabba Tabba tantalum project, which Pilbara’s founders saw as a relatively small and short-term project.

While assessing the Pilgangoora assets, Pilbara’s founders noted the presence of spodumene crystals. When they started a drilling and exploration program early in 2014, they assayed for lithium oxide or lithia (Li2O) as well as tantalite, discovering good grades of the former.

These early results convinced Pilbara’s founders about the potential of the deposit. They made further investment to continue to explore, returning high grades for both lithium and tantalum, and also raised funds for more development of the project.

Between early 2014 and 2017, the Pilgangoora resource has increased to 156 million tonnes at 1.25% Li2O from reserves of 80.3 million tonnes at 1.27% Li2O.

Metallurgical results, conducted by Anzaplan in Germany, indicate the potential to produce a high-grade, low-iron spodumene concentrate product, similar to that produced at the Greenbushes lithium mine, also in Western Australia.

The results confirmed that Pilgangoora can produce and supply not only the standard chemical-grade spodumene (6% Li2O) but also premium-grade spodumene concentrates (+7.0% Li2O) with very low iron content - less than 0.13% Fe2O3 - which is suitable for use in high-quality glass, ceramics and other industrial applications.

Pilbara Mineral considers Pilgangoora to be "one of the largest hard-rock lithia resources globally, with a complementary tantalum resource which is also of significant scale," it told Industrial Minerals. "No other known deposits in Western Australia or globally, except for Greenbushes, can produce this premium-grade product in higher volumes."

CoProfile  
Pilgangoora lithium-tantalum project.
Pilbara Minerals Ltd 

Proximity to the Chinese lithium market

Located only 135km from the world’s largest bulk shipping port in Port Hedland in the Pilbara region - where some of the largest iron ore companies have carried out extensive infrastructure works - Pilgangoora is well connected to the major lithium consumption hub of China, Japan and South Korea. 

Convinced about the future potential demand for lithium in the electric vehicle (EV) and energy storage sectors, Pilbara Minerals has fostered relationships with its major customers, Ganfeng Lithium and Great Wall Motor Co.

These two companies are also significant shareholders in the company and, together with General Lithium, have underpinned its development via offtake agreements for the first and second phases.

The first phase is due for completion during the second quarter of 2018 as planned, Pilbara Minerals said. It will allocate 100% of the chemical/battery grade spodumene production from the first phase to its Chinese customers for conversion to lithium chemicals. 

"The shipping distance is comparatively close and very competitive. Also, operating in the same time zones and developing close relationships with customers in these jurisdictions will greatly assist the successful development of any lithium production business here in Western Australia," Pilbara Minerals told Industrial Minerals.

In the second phase of the project, Pilbara Minerals will expand mining capacity at Pilgangoora to 5 million tonnes per year from 2 million tpy. This will raise output of lithium carbonate equivalent (LCE) to around 105,000 tpy from 40,000 tpy.

While the company has not disclosed the date by which it intends to complete this second phase, it said it will look to make progress to a definitive feasibility study level of assessment for presentation to its board in the second half of next year.

The company will also seek to diversify its customer base outside China, bringing on board more strategic buyers along the lines of Ganfeng or Great Wall.

Lithium carbonate or lithium hydroxide? 

The advantage for hard rock producers is the capacity to produce these two products simultaneously without having first to produce lithium carbonate and then turn it into lithium hydroxide, Pilbara Minerals told Industrial Minerals.

"We believe that both [materials] are essential,"it said. "The technological development and refinement of lithium cathode materials is continuous and different applications of batteries have different specifications.

"These specifications, and the process to achieve these targets, will dictate which of these two lithium chemicals will be used," it added.

In the EV sector, both lithium hydroxide and lithium carbonate are used to produce different sets of lithium cathode materials that are used for a specific type of vehicle, from hybrid or plug-in hybrid to fully electric, the company said.

Outlook

Pilbara Minerals’ priority is to bring the Pilgangoora Project onstream and to deliver material to its customers as quickly as possible. It also plans to start exploration of the Mount Francisco lithium-tantalum exploration assets, also located in the Pilbara region, next year.

"We are doing all we can to meet these deadlines and to continue to grow Pilgangoora’s production to meet the substantial raw material demand growth we see in China and elsewhere around the globe," Pilbara Minerals told Industrial Minerals.

As well as working to become a lithium spodumene supplier, Pilbara Minerals said that is also examining its downstream options.