Arcadium Lithium plans to mothball its Mt Cattlin lithium mine north of Ravensthorpe citing the continued slump of spodumene prices.
Arcadium Lithium plans to mothball its Mt Cattlin lithium mine north of Ravensthorpe citing the continued slump of spodumene prices.
The Mt Cattlin lithium mine will be moved onto care and maintenance by mid-2025, with an eye to potentially resume operations “when market conditions become more favourable”.
Arcadium announced it would suspend any expansionary investment beyond stage three, its current open pit operation, “given the continued decline in spodumene prices”.
The price of spodumene concentrate has dropped to $US775 a tonne, according to Shanghai Metals Market data.
The NYSE-listed miner said it would shelve the operation after it completed stage three mining and ore processing by the end of the first half of 2025.
It would also suspend waste stripping under stage four, being the next stage of open pit mining potentially involving two separate cutbacks or moving to underground mining.
Arcadium said it would continue to explore the viability of previously spruiked underground mining at Mt Cattlin, which could extend the mine life beyond the previously cited range of 2027-28.
The operation employs about 300 workers. It’s the smallest of Western Australia's seven producing lithium mines, topped by Greenbushes.
The decision to mothball the mine marks the latest blow in a string of scale backs and closures across the state's critical minerals sector amid a weak price environment for battery metals.
It also marks another hit for the regional town of Ravensthorpe, after fellow battery metals miner First Quantum Minerals placed its nickel operations near the town on care and maintenance, cutting 330 jobs.
"We remain committed to developing our global portfolio of hard rock assets and are confident that they will continue to be a significant part of Arcadium Lithium's growth story,” Arcadium chief executive Paul Graves said.
“Unfortunately, production at Mt Cattlin beyond the current stage of the open pit cannot be justified in the current price environment for spodumene.
“We will maintain open and transparent dialogue with all of our stakeholders while supporting our employees and communities in Western Australia during this transition period."
Arcadium Lithium was formed through the $16 billion merger of Allkem and Livent Corporation. Its chaired by ex-Woodside Energy chief executive Peter Coleman.
In its second quarter results released last month, Arcadium cited lower spodumene sales due to reduced production at Mt Cattlin. The company said it was expected to deliver cost savings in the range of $60 to $80 million in 2024.
In today’s release, Arcadium said the company expected to increase net cash flow by about $US75 to $US100 million across both 2024 and 2025 as a result of the decision.
Member for Roe Peter Rundle said mothballing the Mt Cattlin lithium mine was a devastating blow to the communities of Ravensthorpe and Hopetoun.
He said it potentially affected up to 300 local jobs at a time when families were already struggling with the cost-of-living crisis.
“This closure follows the shutdown of the First Quantum nickel mine earlier this year, highlighting the volatility of our critical resources sector and the urgent need for stronger support,” Mr Rundle said.
“If we’re serious about a future made in Australia, it starts here in WA, where we have an abundance of critical minerals like lithium and nickel.
“But without real commitments from the Federal Government these industries will continue to face uncertainty.”
Mr Rundle called for the federal government’s production tax credit for critical minerals to be fast tracked and implemented today, not in three years’ time.
The critical minerals production tax credit, announced in the May federal budget, proposes to offer a 10 per cent refundable tax offset from 2027.
It would apply to the processing side of all 31 minerals on the critical minerals list to drive investment in minerals processing in Australia.
