Pilbara Minerals will take its first steps along the lithium value chain in a partnership with China’s Ganfeng that will examine the possibility of developing a major conversion plant for the critical battery material.
Pilbara on Monday said it would join forces with its longstanding customer for a feasibility study that would focus on the location of emerging battery metals hubs and the economics of building the planned 32,000 tonne-a-year facility.
Australia would be considered, along with other countries that have indicated a strong interest in establishing lithium chemical production “with potential economic, taxation and funding incentives on offer, together with access to land and offers of assistance with permitting and approvals”.
The study is expected to be completed by early next year, with an option to progress to a final investment decision through a 50-50 joint venture, which would include a 300,000t offtake deal for spodumene concentrate from Pilbara’s Pilgangoora mine near Pot Hedland.
Pilbara managing director Dale Henderson said the “incremental” move supported the company’s aim to capture greater value through the supply chain.
Mr Henderson said Ganfeng had grown global supply chain relationships with many major operators in the battery materials industry, with a track record for producing low-cost and high-quality chemicals.
“The feasibility study provides an important first step, enabling our two companies to combine our efforts in exploring a preferred location and optimal flowsheet for a downstream lithium chemicals facility which will maximise project economics whilst meeting agreed sustainability standards,” he said.
“This study-first approach provides Pilbara Minerals with the option, but not the obligation, to proceed with a lithium chemicals joint venture.
“This is a prudent approach to ensure Pilbara Minerals only proceeds with a joint venture if the investment case is sufficiently compelling.”
Ganfeng president and vice-chairman Wang Xiaoshen said the study could lead to the launch of a competitive lithium chemicals partnership to service leading customers in the lithium-ion supply chain.
Pilbara said China had a stranglehold on the rapidly growing lithium-ion battery supply chain which was servicing burgeoning demand for related products such as e-mobility and mass energy storage.
“While China is expected to maintain a significant role within the LiB supply chain moving forward, it is expected that there will be growing geographical diversification with new hubs emerging in key strategic regions,” it said/
“Given this evolving landscape for the lithium-ion supply chain, the feasibility study has been intentionally designed to explore the optimal, process technology, chemical end-product, and jurisdiction to ensure the economics are maximised and risks minimised for the future JV.”