Lithium players a twist in tale of Utah sale 19 11 2016 After...

Lithium players a twist in tale of Utah sale
19 11 2016
After more than three years of wrangling, the State Government has won the right to sell the Utah Point bulk handling berth at Port Hedland.
Legislation passed Parliament late on Thursday, despite the objections of its users and the broader junior mining sector. They fear provisions in the enabling legislation requiring 50 per cent of the facilities capacity to be permanently locked away for their use could mean one of the mining majors gets long-term access to the rest of the capacity. The issue has broader ramifications than just the current iron ore users, Mineral Resources and Atlas Iron.
When the legislation was drafted this year, few could have predicted that the Pilbara lithium sector would emerge as rapidly as it has.
Now Pilbara Minerals has signed deals to directly ship raw lithium ore from July next year, using Utah Point as its export terminal. Other emerging players, including Altura Mining and Mineral Resources, are suggesting the industry could be in full swing by the end of next year.
There should be enough capacity to cater for them.
Utah has been running at a rate of 25 million
tonnes a year since July, Pilbara Ports Authority figures show, well ahead of its theoretical 23mtpa capacity.
Next year, Atlas' production will likely drop from Wodgina and Abydos, as the two mines have less than 8 million tonnes of reserves between them, including 2.6mt of low-grade product at Wodgina. But the emergence of lithium juniors will again put access at a premium.
It's all about the timing.
Labor has promised to tear up the process if it wins the March State election, meaning the Barnett Government has two months to lock away a sale before the caretaker period begins in early February.
Contracts already in place will be passed on to the new owner so lithium hopefuls - and other potential iron ore exporters, such as Brockman Mining - will be hoping to have contracts stitched up with the PPA before the sale.
At a critical time for the lithium sector, the Government needs to get the transition right.