Pilbara Minerals’ 100%-owned Pilgangoora Lithium-Tantalum Project (Pilgangoora Project) is located 120km from Port Hedland in Western Australia’s resource-rich Pilbara region. The Pilgangoora pegmatite deposit is one of the largest hard rock lithium deposits in the world.
The Pilgangoora Project is accessible by road, with access to existing infrastructure including port facilities at the port of Port Hedland.
The 2 million tonne per annum (Mtpa) stand-alone mining and processing operation produces ~330,000 tpa of ~6% spodumene concentrate and 321,000 lbspa of +5% tantalite concentrate.
On 2 October 2018, Pilbara Minerals achieved a major milestone with its first spodumene concentrate product shipment from the Pilgangoora Project.
The Pilgangoora Project's high-grade lithia, tantalite by product stream, resource size, outstanding scalability and expansion potential has laid the foundation for a long-life, low-cost operation. It has resulted in the ability of Pilbara Minerals to take it from first drill hole to production in under four years.
Pilbara Minerals’ long-term strategy is to unlock the full value of the Pilgangoora Project's deposit through an expansion and diversification strategy to position it as a fully integrated participant in the lithium raw materials and chemicals value chain.
During the 2020 Financial Year, mining operations at the Pilgangoora Project resulted in the depletion of the Mineral Resource.
In consideration of this, on 30 June 2020 an updated Mineral Resource statement (including stockpiled material) of 222.5Mt grading 1.26% (spodumene), 116ppm Ta2O5 and 0.61% Fe2O3, containing 2.81Mt of Li2O (lithia) and 56.7Mlbs of Ta2O5 was released to the market in the 2020 Annual Report.
Mineral Resources are inclusive of Ore Reserves.
View the Mineral Resource Estimate on page 18 of the 2020 Annual Report here.
As per the Mineral Resource, mining operations during the 2020 Financial Year resulted in the recovery of ore and therefore depletion of the Ore Reserve.
The resultant Ore Reserve as at 30 June 2020 was 104.6Mt at 1.26% Li2O, 120ppm Ta2O5 and 1.17% Fe2O3.View the Ore Reserve Estimate on page 19 of the 2020 Annual Report here.
Pilbara Minerals is working towards an expansion pathway which would see processing capacity grow from 2Mtpa to 5mtpa and ultimately 7.5Mtpa in the years to come. It is proposed this expansion would be achieved through a medium-term Stage 2 and long-term Stage 3 expansion project.
The Stage 2, 5Mtpa expansion of the Pilgangoora Project would ultimately increase production from 330,000tpa to 800-850,000tpa ~6% spodumene concentrate, and 321,000lbspa to 800,000lbspa of tantalite concentrate.
For Stage 2, Pilbara Minerals is pursuing an optimised and incremental expansion strategy to incrementally increase processing capacity inline with its Stage 2 customer requirements. This strategy better positions the business by enabling expansion flexibility and reduced upfront capital for the first incremental concentrate production tonnage.
To evaluate the potential of this revised strategy several technical studies were undertaken throughout the 2020 Financial Year. These studies concluded that a staged expansion to 5Mtpa can be delivered through three incremental phases (see 2020 Annual Report) and avoid the need for a full duplication of a new circuit.
The proposed expansion is underpinned by exceptional Definitive Feasibility Study (DFS) results for an initial Stage 2 expansion to 5Mtpa including a post-tax Net Present Value10% of A$2.160B, life of mine project revenue of $A12.2B ($ real) and life of mine EBITDA of $A6.3B ($ real (see DFS announcement here).
The proposed Stage 3 expansion, which would see processing capacity increase to 7.5Mtpa, is on hold until such time that market demand and/or the participation of a partner is sufficient to justify its development.
The ability to manufacture high-value battery-grade lithium products through downstream processing has the potential to deliver significant additional value for Pilbara Minerals in the years to come. Recognising this, Pilbara Minerals is pursuing a pathway to become a fully integrated lithium raw material and chemical supplier.
Through its relationship with POSCO, Pilbara Minerals is pursuing a proposed downstream joint venture (JV) for the development of a 40,000tpa LCE (lithium carbonate equivalent) lithium chemical conversion facility in South Korea. It is proposed Pilbara Minerals will initially hold a 21% interest in the JV, with an option to increase to 30%.
The facility plans to use POSCO’s patented PosLX purification process to produce industry leading, high-grade hydroxide and carbonate products from the Pilgangoora Project’s spodumene concentrate.
This JV provides Pilbara Minerals a first-mover position in this fast-growing Korean market with a strategic partner. POSCO is one of the largest suppliers of steel to the global automobile industry and has a vision is to become a ‘total solution provider’ for EVs.
The Pilgangoora Project has attracted a group of high quality, experienced global offtake partners including Ganfeng Lithium, General Lithium, Great Wall Motor Company, POSCO and Yibin Tianyi. Collectively, these partners underpin the Stage 1 and 2 projected production from the Pilgangoora project.
The 2Mtpa processing plant capacity for Stage 1 produces ~330,000tpa of 6% spodumene concentrate.
This production is allocated under offtake agreements with Ganfeng Lithium (160,000 tpa) for 10 years with the option to extend by 10 years and General Lithium (120,000 tpa) for six years.
During the 2020 Financial Year, Pilbara Minerals diversified its Stage 1 offtake customer base to Great Wall Motor Company (20,000 tpa) for approximately six years and Yibin Tianyi (up to 75,000 tpa) under a five-year agreement.
To support the Stage 2, 5Mtpa expansion, Pilbara Minerals has entered into an offtake agreement with Great Wall Motor Company, one of China’s largest pickup and sport-utility vehicle manufacturers. This offtake agreement encompasses 75,000 tpa spodumene concentrate (SC6.0 basis) with the option for a further 75,000tpa (for a total of 150,000tpa) following agreement of binding terms with respect to a debt or offtake prepayment funding facility for Stage 2 of up to US$50 million.
To complement this already extensive, highly experienced list of global offtake partners Pilbara Minerals has entered into a strategic relationship with POSCO. This strategic partnership involves both offtake and a proposed JV for a downstream chemical conversion facility in South Korea as detailed above.
The agreement with POSCO encompass a binding life of mine offtake agreement for an initial 80,000tpa of spodumene concentrate (SC6.0 basis) from the Stage 2, 5Mtpa operation, with an increase to up to 315,000tpa upon participation in the JV .
For the latest updates on development activities at the Pilgangoora Project, please visit our ASX Announcements page.
HQ: Level 2, 88 Colin Street, West Perth WA 6005
Postal Address: P.O. Box 884, West Perth WA 6872
Phone: +61 8 6266 6266 | Fax: +61 8 6266 6288