Domestic processing of lithium could provide a value-adding opportunity for an industry WA already dominates.
TECHNOLOGICAL advances in battery development, and the resultant surge in demand for lithium, is leading some up and coming local players to consider a move into new parts of the supply chain.
According to the Department of Mines and Petroleum, demand for lithium could rise as much as 50 per cent from 2013 to 2017; and Western Australia is in the hot seat to benefit, as one of the world’s largest lithium producers.
It has coincided with a move away from cheaply extracted South American product, which has different properties and is not as useful for batteries.
That could make processing of the raw material, which largely happens overseas, a good option for the state, according to Neometals managing director Chris Reed.
“WA has already established itself as the single largest supplier of raw material to the international lithium market,” Mr Reed told Business News.
“Given the importance of lithium to the world energy market moving forward, we think it is very important that WA takes this opportunity to build on that foundation and hopefully establish a downstream industry as well.”
An advantage for miners moving into processing would be reduced transportation cost, with around 94 per cent of what is mined currently going to waste.
It will be costly to develop the technology, however.
Neometals, which is negotiating an off-take agreement for its Mount Marion project, has been working on a pilot technique in the US.
It has attracted international interest.
“While there is competition from other governments that are trying to encourage us to establish downstreaming operations in their country, we are trying very hard to find ways to build an economically competitive business in WA,” Mr Reed said.
Commercialisation could potentially be funded by earnings from its potential mine operation, or through government support to kick start the industry.
“The mine is fully financed and permitted,” Mr Reed said.
“Once (off-take) negotiations are complete and the decision to mine has been made, we will be in production in less than 12 months.
The project is estimated to have a lifespan of around a decade.
Other lithium deposits in WA include the Greenbushes mine operated by Talison Lithium and the Mount Cattlin mine operated by Galaxy Resources, which has been on care and maintenance since 2012.
Junior player Cobre Montana has also targeted the metal, building a technical alliance with Strategic Metallurgy to commercialise disruptive lithium extraction technology.
It announced a small breakthrough last week in testing the technology at its Seabrook deposit.
