Galaxy Resources has opted not to restart its Mt Cattlin spodumene project near Ravensthorpe – resulting in 37 staff being made redundant.
The company has instead signed a deal with fellow Western Australian spodumene producer Talison Lithium for feedstock to supply Galaxy’s Jiangsu lithium carbonate plant in China.
The Jiangsu plant uses spodumene to produce lithium carbonate, which is then used to make lithium-ion cathode batteries.
Galaxy previously used spodumene from the Mt Cattlin project in Western Australia to feed the Chinese operation, but halted production when it reached a 12-month supply back up.
At that time – in June 2012 – it said the plant would remain ready to restart production when more spodumene was needed to supply the Chinese plant.
But the company has now announced the high Australian dollar and adverse operating conditions in Australia made sourcing spodumene from Talison Lithium – also Western Australian-based – more economical.
Galaxy’s managing director Iggy Tan said 37 staff would be made redundant from the Mt Cattlin plant as a result.
“I’d especially like to thank the Galaxy team at Mt Cattlin for their hard work and dedication to this project,” Mr Tan said in a statement.
Mr Tan said the Mt Cattlin project was still considered a valuable strategic asset and would remain operationally ready to restart should Galaxy need to resume its own internal spodumene production.
In the meantime, Talison’s headgrade – at three times that at Mt Cattlin – was a contributor in it being a more sensible option.
"The Talison Greenbushes mine has the benefit of a threefold head grade and greater capacity compared to Mt Cattlin, and can better weather the impact of the high Australian dollar," Mr Tan said.
The supply contract with Talison is expected to begin in July once existing stocks are depleted.