Lithium miner Galaxy Resources said it would scale back operations at its Mt Cattlin mine in Ravensthorpe to help reduce costs until the electric vehicle market improves.
Lithium miner Galaxy Resources said it would scale back operations at its Mt Cattlin mine in Ravensthorpe to help reduce costs until market conditions improve.
Galaxy said the current pricing for lithium products is unsustainable, with lithium and spodumene markets currently oversupplied, and said it expects further supply rationalisation as a result.
In a project update, Galaxy said it would reduce its Mt Cattlin operations by around 60 per cent, which in turn would reduce operating costs by around $US20 million.
“Production and existing inventory will be sufficient to satisfy contracted commitments and additional product demand in 2020,” Galaxy said.
“Production can be ramped up swiftly and efficiently, should market conditions materially improve.”
Mt Cattlin was placed into care and maintenance between 2013 and 2016 as a result of competition from alternative lithium sources.
Galaxy’s project portfolio also consists of the Sal de Vida lithium and potash mine in Argentina and the wholly-owned James Bay spodumene project in Canada.
The company said it plans to advance the Sal de Vida mine to execution in 2020, which is currently the source of more than 40 per cent of global lithium production.
Galaxy said it would also complete an integrated feasibility study for James Bay next year.
Shares in Galaxy Resources were down 2.31 per cent to trade at $1.06, as at 4:10pm AEDT.