Galaxy Resources says it will award a key contract for its Jiangsu lithium processing facility after today revealing a slight increase in the operation's capital cost estimate of $55 million.
The company, which is also progressing its $68 million Mt Cattlin lithium project in Ravensthorpe, today revealed results from the Jiangsu definitive feasibility study, which was carried out by Hatch Engineering in China and Brisbane.
Managing director Iggy Tan said the final capital cost estimate is in line with earlier estimates of $50 million.
"The slight increase in capital costs represents extra processing equipment associated with alumina silicate and sodium sulphate by-product processing/packaging that was not included in the pre-feasibility study. The revenue generated from these by-products is expected to offset the extra capital costs," Mr Tan said.
"In addition, the new capital estimate includes a spodumene stockpile facility and the Zhangjiagang land costs."
Galaxy expects to start construction of the plant in April 2010 with first production scheduled for quarter four of 2010.
The company will soon award the engineering, procurement and construction management contract for Jiangsu.
"The successful outcome of the Jiangsu DFS represents the final pre-development stage in the value adding aspect of the Company's China operations, and moves Galaxy closer to becoming a key supplier of battery grade lithium carbonate to the Asian market," Mr Tan said.
Shares in Galaxy were down 10.5 cents to $1.64 at 11:52 AEDT.
