Pilgangoora Operation

Overview

The Pilgangoora Operation’s location, high-grade lithium, tantalite by product stream, resource size, outstanding scalability and expansion potential has laid the foundation for a long-life, low-cost, sustainable operation.

Pilbara Minerals’ 100%-owned Pilgangoora Operation is located 120km from Port Hedland in Western Australia’s resource-rich Pilbara region. The Pilgangoora ore body is one of the largest hard rock lithium deposits in the world and is considered strategically important within the global lithium supply chain.

Located in one of the world’s premier mining jurisdictions, the Pilgangoora operation has access to first-class supporting infrastructure including road and port and is underpinned by strong environmental and safety regulations and social standards.

The operation consists of two processing plants. Plant One, located on the northern side of the Pilgangoora area, produces a spodumene concentrate and a tantalite concentrate, and Plant Two located to the south produces a spodumene concentrate. 

Two processing plants provides Pilbara Minerals speed to market by enabling it to rapidly increase production to satisfy rising lithium market demand and flexibility by being able to blend products to meet customer needs.

An expansion and diversification pathway underpins Pilbara Minerals’ long-term strategy to unlock the full value of the Pilgangoora Operation and become fully integrated within in the lithium raw materials and chemicals value chain.

Mineral Resource 

Combined Mineral Resource (inclusive of the neighbouring operation) positions Pilbara Minerals’ Pilgangoora Operation as one of the largest hardrock lithium supply bases globally.

Mineral Resources are inclusive of Ore Reserves.

Reserves

Pilbara Minerals acquired Plant Two and its surrounding operations in January 2021, when its neighbour when into voluntary administration.

Following the acquisition, Pilbara Minerals is now focussing on a comprehensive evaluation of this operation including a restatement of Ore Reserves inclusive of Plant Two.

Operations 

Plant One 

The 2 million tonne per annum (Mtpa) mining and processing operation produces ~330,000 tpa of ~6% spodumene concentrate and 321,000 lbspa of +5% tantalite concentrate. The processing facility consists of a heavy/dense media separation (DMS) circuit to produce a coarse concentrate and a flotation and gravity circuit to produce fines concentrate.

Both the fines and coarse concentrate are blended to deliver a high quality, ~6% spodumene concentrate product to customers.

Following first shipment in October 2018 and the achievement of commercial production in April 2019, Pilbara Minerals continues to optimise Plant One operations to improve processing performance and reduce operating costs.

Plant Two 

Following the acquisition of Plant Two and its supporting operations, Pilbara Minerals is now focussing on a comprehensive evaluation of this operation.

This evaluation will inform how best to integrate the lithium operations to maximise synergies and provide a pathway to recommence operations at Plant Two.

Currently, the operation is in care and maintenance.

Expansion 

The scale of the combined Mineral Resources at Pilgangoora provides significant opportunity for Pilbara Minerals to expand operations and production with market demand.

With latent capacity contained within the combined operation, the first stage of expansion will draw from current assets. Utilising this latent capacity enables Pilbara Minerals to ramp up production rapidly to meet an increase in demand, with less capital investment.

The first stage (Stage 1) of production expansion will be delivered through a series of Plant One improvement works to unlock an additional 10-15% (~30- 50ktpa) of production capacity and recommencement of operations at Plant Two.

Prior to the acquisition of Plant Two, Pilbara Minerals had been undertaking study work to support an optimised and incremental expansion of production capacity through a Stage 2 expansion of Plant One.

The proposed Stage 2 expansion would increase processing capacity to 5Mtpa to produce 800-850,000tpa ~6% spodumene concentrate, and 800,000lbspa of tantalite concentrate through three stages.

To evaluate the potential of an incremental expansion, several technical studies have been completed which estimate the next phase of the incremental Stage 2 expansion capacity would be capable of being delivered within approximately nine months following a financial investment decision.

Diversification 

The ability to manufacture high-value battery-grade lithium products through downstream processing has the potential to deliver significant additional value for Pilbara Minerals. 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.

Offtake

Pilbara Minerals 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 Plant One production and its proposed Stage 2 expansion.  

Plant One

Current production - ~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.

Stage 2 ~850,000tpa of 6% spodumene concentrate.

This production is allocated under an offtake agreement with Great Wall Motor Company for 75,000 tpa spodumene concentrate with the option for a further 75,000tpa following agreement of binding terms with respect to a debt or offtake prepayment funding facility for Stage 2 of up to US$50 million.

Pilbara Minerals’ strategic relationship with POSCO involves an agreement for offtake and a proposed JV for a downstream chemical conversion facility in South Korea as detailed above. The agreement encompasses a binding life of mine offtake agreement for an initial 80,000tpa of spodumene concentrate, with an increase to up to 315,000tpa upon participation in the JV.

Plant Two

No offtake has been allocated for Plant Two production.

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