Lithium Related Media Articles, page-24094

I read this interesting article in * that I'd like to share with you all.

Shaaki-t Off: Ken Brinsden says Canadian mine study shows lithium prices have to rise.

Published: August 23, 2024.
Author: Josh Chiat.
Link: Read full article here.

Key takeaways:

• Ken Brinsden (former PLS boss) says prices cannot stay where they are long term as the West wrestles to take control of lithium prices off China.
• Shaakichiuwaanaan project in Canada yesterday, placing a US$487 million price tag of the first stage of the 24 year, 400,000tpa spodumene development in a preliminary economic assessment ("PEA").
• That works with a 3.6 year payback at total cash costs of US$560/t and lithium pricing of US$1500/t SC6 or US$1375/t for the 5.5% Li2O concentrate Patriot plans to produce at the Quebec mine.
• Current SC6 prices sit at just US$770/t according to Fastmarkets, a result of oversupply last year partly resulting from Chinese investment of low grade resources in China and Africa and lower than expected growth in the electric vehicle market.
• Brinsden says at those prices Shaakichiuwaanaan, one of the best undeveloped hard rock lithium asset globally, would not be developed in its studied form. Alternatively, it could be developed as a high grade underground operation leveraging the Nova Zone, a part of the CV5 deposit which contains world-leading grades of over 2% Li2O, but in doing so, Patriot could be leaving in the ground valuable metal needed to service future EV battery and energy storage demand. (This reminds me of LTR's underground operation).
• That highlights the problem facing lithium markets globally and underlines why the mining doyen believes prices – down ~75% in the past year – are bound to head higher.
• “Perversely, our PEA in a manner of speaking, actually shows what’s required in the industry to incentivise new supply,” Brinsden told *.
• “Honestly, we’re one of the premier development projects globally.
• “If it was today’s price, you’d be second guessing, firstly, whether you develop or alternatively, what project you develop and it’s definitely not going to be the same scale.
• “The PEA is evidence that the price has to be higher. Everybody knows our project is one of the good ones, and yet you wouldn’t choose to develop that project if you had to execute today.
• “In our case it would be a high-grade option, which not many projects around the world have got the ability to deploy.”

My understanding in relation to LTR's KV project:

Ken Brinsden’s optimistic view on high-grade lithium projects can also be relevant to projects like Liontown Resources’ Kathleen Valley (KV) project.

Although he didn’t specifically mention Kathleen Valley, Brinsden highlighted that high-quality lithium projects don’t need to compete directly with lower-grade sources from places like China or Africa. He pointed out that, for projects like Shaakichiuwaanaan, the current lithium price of US$770 per ton is too low to justify development. However, Brinsden believes that as demand for high-grade lithium grows, prices will rise to levels like US$1500 per ton, which would make these projects economically viable. This positive outlook suggests a brighter future for high-grade projects like Kathleen Valley, as they stand to benefit from higher prices in the evolving lithium market.

With this being said and considering the scarcity of SC6+, I speculate whether the advancement of the Tesla commercial production notice to December 2024 may play favourably to LTR if in-fact the pricing mechanism is inline with the this outlook.

Just a thought.

Cheers,