Allkem’s updates today make for some interesting reading, their capital costs across various projects have pushed out 34-48%. The most relevant are Sal de Vida with capex up 38% and operating costs up 22% (it’ll cost them US$4,003/t LCE), and Cauchari with capex up 48%. The original Sal de Vida study was from March 2022; the Cauchari one was from October 2019, hence the capex increase is much higher.
These dates are interesting because Galan’s original HMW 20ktpa PEA was released in December 2020. Purely focusing on the capex, they had “initial capital cost of US$439M (US$338M without 30% contingency)”. A year later, in December 2021 they released an update to the study but all this really did was increase the price assumptions, and kept capex unchanged. So it’d seem reasonable to assume that there’s likely to be something in the region of 40-45% capex increase on this figure, based on what others have reported. In ordinary terms, that would take the 20ktpa capex figure to between US$615M to US$637M, however Stage 1 already had capex of US$118M in there, so you’d think/hope there has to be some meaningful savings on Stage 2 capex.
Not long to find out now (presuming JP nails his timeline this time)
GLN Price at posting:
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