Pilbara Minerals shares break the $1 barrier on news of South Korean battery JV potential
Stuart McKinnon
Friday, 10 November 2017 11:51AM
Pilbara Minerals shares break the $1 barrier on news of South Korean battery JV potential
1:17 | The West Australian
Finance News Presenter Meilin Chew says WA is in the driver’s seat to power the new lithium battery world
Pilbara Minerals has cracked the $1 mark after the aspiring lithium miner flagged a potential joint venture deal to provide lithium hydroxide to the South Korean battery industry.
The Ken Brinsden-led company announced this morning it was in non-binding discussions with LG Chem and Polaris Shipping for a downstream processing facility capable of producing up to 30,000tpa of lithium hydroxide.
Mr Brinsden said the memorandum of understanding presented an opportunity for Pilbara’s participation in one of the world’s most exciting and fastest growing markets for lithium raw materials outside of China.
“South Korea is a major global economic and industrial power with a very large and rapidly growing high-technology industrial complex and automotive industry,” he said.
“Discussions like these present an opportunity to work alongside two of South Korea’s leading conglomerates to participate in the development of a world-leading downstream lithium chemicals facility servicing the rapidly growing lithium-ion battery industry in South Korea.
Mr Brinsden said the discussions were consistent with the company’s broader objective of moving downstream from its mining activities to chemical processing and to diversify global sales arrangements.
“Given the scale of the existing resource and reserve at Pilgangoora – and the potential to continue to grow it with ongoing drilling – we have plenty of capacity to support both our existing customers in China and new customers elsewhere,” he said.
Construction of the company’s $234 million, 2mtpa Pilgangoora lithium-tantalum project 120km south of Port Hedland is in full swing with mining expected this month and first shipments anticipated before the end of June next year.
The mine and processing facility will produce a 6 per cent spodumene concentrate that will be upgraded by Pilbara Minerals’ Chinese customers into battery-grade lithium carbonate or lithium hydroxide to be used in lithium-ion batteries.
Pilbara Minerals already has offtake agreements covering the majority of its 330,000tpa of spodumene from stage one of Pilgangoora with Chinese customers General Lithium and Gangfeng Lithium.
It also recently announced a deal with Chinese car manufacturer Great Wall which will underwrite the development of Pilgangoora’s stage two to boost capacity to 5Mtpa, producing as much as 800,000tpa.
Pilbara shares were up 5.7¢, or 5.82 per cent, to $1.037 at 9.30am after touching an all-time high of $1.105 in earlier trade.
TOPICS
MiningLithiumMarkets
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