Albemarle brings forward WA project

Albemarle Corporation has revised the construction schedule for its $1 billion lithium plant at Kemerton, with site works due to start next month and the US company accelerating expansion of the project.

Chairman and chief executive Luke Kissam told investors in the US last night the company expects to obtain all necessary approvals to allow for the start of earthworks at Kemerton in December.

The company's updated plans were disclosed in a conference call held in the United States last night after Albermarle lodged its quarterly earnings report.

It coincided with the Kemerton project, located 17 kilometres north east of Bunbury, obtaining environmental approval from the state government.

Albemarle’s long-term plan is to build five processing trains at Kemerton, to produce up to 100,000 tonnes of lithium hydroxide.

Commissioning of the first two trains is due to commence in stages during 2021.

Chief financial officer Scott Tozier said the expansion beyond that point had been accelerated.

“We previously disclosed that Kemerton would have an initial capacity of 40,000 metric tonnes with an ability to expand to 100,000 metric tonnes over time,” Mr Tozier said.

“We now expect to accelerate a portion of that additional capacity to add another production line at Kemerton, which would increase the initial nameplate capacity to at least 60,000 tonnes.”

Presentation slides lodged by Albemarle show that commissioning of the third train has been brought forward to 2021 or 2022.

Mr Kissam also disclosed the move to full capacity could take up to seven years, as the company sought to expand its production in line with customer demand.

“That growth is going to come from our ability to build-out lithium hydroxide facilities and likely the ability to expand Kemerton to 100,000 metric tonnes over the next five to seven years.”

In contrast, the company has halted its expansion plans in Chile, where it had been aiming to increase production of lithium carbonate.

“Right now we’ve got a bigger need in lithium hydroxide as we look out past 2021,” Mr Kissam said.

“We have stopped all engineering work on any further carbonate expansions in Chile at this time.”

The state government said today the Kemerton project will create more than 500 construction jobs, with an initial 100 operational jobs.

The Kemerton plant will process ore from Talison Lithium’s Greenbushes mine, which in March announced an expansion to supply the rapidly growing global lithium market.

Talison is jointly owned by Albemarle and Chinese company Tianqi Lithium, which is in the midst of spending $700 million on its own lithium hydroxide plant at Kwinana.

The Tianqi plant will have capacity of 48,000 tonnes and is scheduled for commissioning in late 2019.

Perth company Mineral Resources is likely to be the next cab off the rank with advanced plans to build a lithium hydroxide plant at its Wodgina mine in the Pilbara.

In addition, Neometals is completing a front-end engineering and design study on its planned Kalgoorlie lithium refinery and Melbourne-based Kidman Resources is aiming to join the ranks of lithium hydroxide producers, with early-stage plans for a plant at Kwinana.

Premier Mark McGowan said he was pleased to see the Kemerton project progressing, following his positive discussions with Albemarle’s directors during a visit to Washington earlier this year. 

“My government’s number one priority is diversifying the economy and creating jobs for WA, so significant milestones like these support our efforts in improving the WA economy and boosting job opportunities,” he said.

“The Abermarle lithium plant is another step closer to setting up its operations which will generate hundreds of local jobs.

“The State is a world-leading producer of lithium and WA has an abundant supply of lithium and other battery minerals which is why it’s vital we maximise the opportunities this industry provides, both upstream and downstream, to Western Australians.”

Environment Minister Stephen Dawson said Albemarle was another example of the McGowan government balancing environmental outcomes and a prospering economy.

“The Albemarle lithium plant has undergone a thorough environmental assessment process by the Environment Protection Authority, which recommended the project could proceed subject to strict environmental conditions,” Mr Dawson said.