Good News & Bad News, page-41316

Can’t wait for Pilbara to make a $6.3 billion profit….
Country’s largest lithium mine unveils bumper $6.3b profit

Brad ThompsonApr 1, 2024 – 5.18pm

The Greenbushes mine is owned jointly by IGO, China’s Tianqi and Albemarle. Gettynone
The accounts showed revenues topped $9.8 billion in the 12-month period and EBITDA jumped to $9.02 billion from $4.7 billion in the prior year. New York-listed Albemarle, which owns 49 per cent of Greenbushes, contributed revenue of $5.47 billion and owed the joint venture entity $803 million as of December 31.
The Greenbushes result coincides with an uptick in lithium prices after steep falls through much of 2023. Fastmarkets, a pricing agency, quoted a spodumene concentrate price of $US950 a tonne at the start of 2024 compared with about $US8000 a year earlier.
IGO flagged in January that the production of spodumene concentrate at Greenbushes would be “marginally reduced” in the period to June 30 because the mine owners had ordered less volume than previously expected.
Analysts have estimated Greenbushes would still be profitable even if prices for spodumene concentrate fell to about $US420 a tonne. Albemarle reportedly sold a cargo to China for about $US1246 a tonne through auction late in March.
Another WA lithium producer, Mineral Resources, said last week that it sold a cargo for $US1300 a tonne, or 10 per cent more than the prevailing spot price at the time, and noted a 37 per cent jump in Australian spodumene prices across February and March.
The owners of Greenbushes have prioritised the production of battery-grade lithium chemicals from their share of spodumene produced at the mine.
However, both Albemarle and Tianqi Lithium Energy Australia have struggled to get lithium hydroxide plants built in WA operating at anywhere near nameplate capacity.
In February, IGO downgraded spodumene production guidance from Greenbushes this financial year to between 1.3 million and 1.4 million tonnes, citing a need to manage stockpiles after lower sales. It forecast production costs at Greenbushes would increase from between $280 and $330 a tonne to between $330 and $380 a tonne.
IGO opted not to publish any production guidance for its troubled hydroxide plant at Kwinana south of Perth, while Albemarle said it had flown in workers from Chinato try to get its plant at Kemerton running properly. The plant started the year operating at about 50 per cent capacity and was still not producing a product approved by customers.
Albemarle spent more than $US1.5 billion ($2.3 billion) building the first two 25,000-tonne-a-year production trains at Kemerton, but cut about 150 construction jobs last month after opting to delay some work until a recovery in lithium hydroxide prices.
The Greenbushes mine employs about 780 people. It paid royalties of almost $570 million in 2023 and income tax of more than $2.6 billion.
The Greenbushes accounts put the mine’s remaining life at 20 years. They show that the venture also made a profit on the sale of some of the lithium exploration projects in Chile it owns with the Vecchiola family through a partnership known as Salares de Atacama Sociedad Contractual Minera, or SALA.
In November, SALA sold mining concessions covering thousands of hectares of salt flats in Chile to French group Eramet for $US95 million.