Here's the realistic analysis of CATL's lepidolite project, A mine: Yongxin; B Mine: CATL
How much lithium carbonate can be produced from the lepidolite mine in Jiangxi?
Source: Snowball
2022-09-05 10:47:58
(Original title: How much lithium carbonate can be produced from Jiangxi Lepidolite Mine?)
Let’s talk about the conclusion first:
The grade of lepidolite ore in Ningde era (known as CATL) in Jiangxi is too low. In addition to the difficulty in processing the tailings, the actual ore recycling rate is also very low and the cost is extremely high. Frankly speaking, the socio-economic benefits of developing this type of lepidolite mine are very poor!
A mining scale of 10 million tons can only produce 27,800 tons of lithium carbonate. After the entire 30 million tons mining and processing scale is put into operation, the annual production capacity will be only 83,400 tons of lithium carbonate, not the generally believed to be hundreds of thousands or even nearly 200,000 tons.
When calculating the supply and demand balance sheet of lithium carbonate in 2023 and 2024, Jiangxi's lepidolite lithium extraction capacity is a factor that cannot be ignored. However, many opinions in the market are different from the actual research. Today I will share the research with you. One of the key points of the current discrepancy is that some institutions may have overestimated the lithium yield of Jiangxi lepidolite. , thus overestimating the production of lithium carbonate. The second is to simply regard the construction plans released by each company as future production capacity and output, ignoring that actual mining production is much more difficult than "planned mining".
The following is a brief analysis of the lithium extraction data of different grades of lepidolite ore calculated based on the survey situation. What is the yield of lithium extraction from lithium ore and what is the production cost.
1. Grade of Jiangxi Lepidolite Ore
From Table 1, the grade of Jiangxi lepidolite (lithium oxide content) ranges from 0.4-0.6% to 0.2-0.3%, which is generally much lower than the grade of Sichuan spodumene mine (average 1.2-1.4%). about). As far as we know, most of the higher-grade lithium mines in Jiangxi have been detected. It may be impossible to find large-scale high-grade ores. At most, small-scale high-grade ores will be found in local areas.
Table 1 List of major domestic lepidolite ores
Data sources: Company announcements, Ministry of Natural Resources, CITIC Securities.
Note: The name of the company has been omitted when citing. According to the "Exploration Report on Ceramic Soil (Lithium-Containing) Mineral Area in Zhenkouli-Fengxin County, Yifeng County, Jiangxi Province", the lithium oxide grade in the Yanxiawo Mining Area is an average of 0.27%.
The largest mine in the table is the Ganxiawo mining area, with an average grade of 0.27%, equivalent to approximately 6.57 million tons of lithium carbonate. There is currently a company building a mining and processing plant here, which is divided into three phases. The first phase is 10 million tons. It is planned to be completed in January 2023 and put into operation in March 2023. It is planned that all three phases will be completed in 2024, with a total mining and processing scale of 30 million tons per year. This mine is large in scale, so it has attracted much attention and has become an important factor affecting the total supply and price of lithium carbonate in 2023, 2024 and even beyond. Some media believe that once the project is completed, it will produce 200,000 tons of lithium carbonate per year. The supply of lithium carbonate may change from short supply to oversupply, and prices will fall. However, the demolition of the mine has not yet been completed, and it has only received the approval for the ore dressing plant, but not the tailings pond (data source: Uncovering the mystery of the "Ningwang" lithium mine: Tens of millions of tons of mineral processing capacity is about to be released. Mineral depots have become a “big worry”
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2. Lithium extraction yields from different grades of lepidolite ore
However, actual mining is much more difficult than "planned mining" and is often affected by factors such as environmental protection, infrastructure, road traffic, ethnicity, religion, resources, technical routes, climate, etc., resulting in progress that is likely to be lower than expected. To take a step back, even without these factors, it is impossible to extract all the lithium elements in lepidolite, because some lithium elements will be consumed in each production and extraction link.
To facilitate understanding, for example, there are three mines A, B, and C, with grades of 0.55%, 0.27%, and 0.20% respectively. All three mines are real. Mine A is already in production and has real data for reference. Therefore, we can use the data of mine A to roughly calculate the yield and cost of mine B and mine C.
The first choice is mineral processing. The first stage of mineral processing is desliming. Regardless of the grade of the raw ore, about 20% of the raw ore must be removed, and only 80% of the raw ore enters the mineral processing stage (if the grade of the raw ore is high, slightly less will be removed). Then it enters the mineral processing process, which generally takes away 0.08% grade lithium oxide. The grade of ore A is 0.55%, taking away 0.08% of lithium oxide, leaving 0.47%, that is, the yield of the ore dressing process is 85.45%. The grade of ore B is only 0.27%, and 0.08% is taken away, leaving only 0.19% of lithium oxide, that is, the yield of the ore dressing process is only 70.37%. Concentrate is obtained through mineral processing. The higher the grade of raw ore, the higher the grade of concentrate. The grade of ore A is 0.55%, and the grade of the concentrate obtained is generally 2.7-2.8%. We calculate it as 2.75%. The grade of ore B is 0.27%, and the grade of the obtained concentrate is about 1.5-2.0%. We calculate it as 1.75%.
Next, the concentrate is leached to extract lithium. At this stage, the lithium oxide taken away by the waste residue is a relatively fixed range, not a ratio. About 0.4-0.5% grade lithium oxide will be taken away in the waste residue. The grade of concentrate made from mine A is 2.75%, and 0.45% of lithium oxide is taken away, leaving 2.3%, so the yield is 83.64%. The grade of concentrate made from ore B is 1.75%, and 0.45% of lithium oxide is taken away, leaving 1.3%, so the yield is 74.29%.
The above data are all theoretical calculations. The actual production and operation process is much more complicated, and the lower the grade, the more difficult the processing and the more complicated the calculation.
Table 2 Yield and cost estimates of lithium extraction from lepidolite ores of different grades
Data source: compiled and calculated by Zhongrong Fund
Based on these data, Table 2 is obtained:
【1】The total yield of Mine A is 57%. 100 tons of 0.55% grade A mine contains 0.55 tons of lithium oxide, and can only extract 0.3135 tons, of which the lithium element accounts for 14/30, or 0.1463 tons, and can produce 0.7733 tons of lithium carbonate (containing 14/74 lithium elements). That is, 129 tons of raw ore is required to produce 1 ton of lithium carbonate. This calculation result is similar to the generally believed 120-130 tons.
【2】The total yield of Mine B is 41.8%. That is, 100 tons of 0.27% grade B ore contains 0.27 tons of lithium oxide, and can only extract 0.113 tons, of which the lithium element accounts for 14/30, or 0.0527 tons, and can produce 0.2784 tons of lithium carbonate (containing 14/74 lithium elements). That is, producing 1 ton of lithium carbonate at this time may require 359 tons of raw ore, which is 2.78 times that of mine A!
Previously, the media and market institutions generally believed that 120 tons of raw ore in Mine A can produce 1 ton of lithium carbonate, and the grade of Mine B is exactly half of Mine A. Mine B should produce 1 ton of lithium carbonate with 240 tons of raw ore, and 10 million tons of raw ore can produce 4.17 Ten thousand tons of lithium carbonate. Our calculations show that actual production may not be achieved.
A mining scale of 10 million tons can only produce 27,800 tons of lithium carbonate. After the entire 30 million tons mining and processing scale is put into operation, the annual production capacity will be only 83,400 tons of lithium carbonate, not the generally believed to be hundreds of thousands or even nearly 200,000 tons.
If the mine can obtain approval for the tailings pond in the first half of 2023 and put the first phase into production in July 2023, it may only be able to produce 13,900 tons of lithium carbonate in 2023. Based on the annual mining and processing capacity of 15 million tons in 2024, only 41,800 tons of lithium carbonate can be produced in 2024 (far lower than the hundreds of thousands tons that many institutions believe). When all 30 million tons of lithium carbonate are put into production in 2025, 83,400 tons of lithium carbonate can be produced. Of course, if the approval of the tailings pond cannot be obtained, the issue of production cannot be discussed for the time being.
I personally believe that lithium extraction from lepidolite in Jiangxi may not be able to fill the supply gap of lithium carbonate in 2023, and the price of lithium carbonate may continue to remain high.
3. Production cost calculation
The production cost calculation of lithium carbonate is very complex. In order to facilitate understanding, we adopt a simple method to calculate.
It is known that the current full cost of producing 1 ton of lithium carbonate by a company (A Mine) is approximately 70,000 yuan/ton. Due to the low grade of Mine B, the amount of raw ore required to produce 1 ton of lithium carbonate may be 2.78 times that of Mine A. This means that the amount of infrastructure, number of production lines, labor, auxiliary materials, energy consumption, tailings treatment, etc. during production may be 2.78 times that of Mine A. Based on a rough estimate, the complete cost may also be 2.78 times that of Mine A. , that is, 195,000 yuan/ton of lithium carbonate. This is also the consensus view of the current market.
As can be seen from Table 2, the grade of C ore is 0.2%. Even if the grade of the concentrate after beneficiation can reach 1.75%, 569 tons of raw ore will be needed to produce 1 ton of lithium carbonate, and the cost will be as high as 330,000 yuan/ton.
This means that if the price of lithium carbonate is lower than 330,000 yuan/ton in the future, mine C will have no mining value; if the price of lithium carbonate is lower than 195,000 yuan/ton, mine B will have no mining value.
Because Mine B is larger, we believe that the price of lithium carbonate is unlikely to be lower than 195,000 yuan/ton in the next few years unless a large amount of low-cost lithium ore is mined.
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