Pilbara releases DFS for $231m stage-two

Pilbara Minerals has released a definitive feasibility study for the planned stage-two expansion at its Pilgangoora lithium-tantalum project, with chief executive Ken Brinsden confident the $231 million upgrade will go ahead.

The proposed development comprises a new 3 million tonnes per annum processing train, taking overall output to 5mtpa.

The news comes after the company revealed last month it had produced its first coarse concentrate at Pilgangoora, after pumping out its first fines concentrate in June.

Pilbara said the DFS has delivered a slightly higher capital cost than the pre-feasiblity study estimate of $207 million, but the previous forecast was modelled off a 2.5mtpa processing circuit.

The expansion will take production to 800,000 to 850,000tpa of spodumene concentrate over a 17-year mine life, along with about 800,000 pounds of tantalite annually.

The study estimates revenue across the 17 years will be $12.2 billion at the project, while earnings before interest, taxes, depreciation and amortisation will total $6.3 billion.

Mr Brinsden said funding for the project would be supported by offtake customers, with commitments for up to $US100 million of debt from Chinese companies Ganfeng Lihtium and Great Wall.

South Korean steelmaker Posco also recently made an $80 million equity investment.  

“The long life of the operation and its ability to deliver a high quality spodumene concentrate at a low cost to market is what sets us apart globally,” Mr Brinsden said.

“This and our ability to rapidly scale-up spodumene concentrate production to over 800,000tpa plays perfectly into our downstream value adding strategy of continuing to grow with our customers, and supports the proposed joint venture with Posco.

“The encouragement from our partners, General Lithium, Ganfeng Lithium, Great Wall Motors and POSCO, to expand our operations has been outstanding.”

Shares in Pilbara finished up 6.75 per cent at 90 cents each.