Liontown Resources (ASX:LTR) - Incoming Managing Director, Tony Ottaviano
Incoming Managing Director, Tony Ottaviano
Source: Liontown Resources
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  • Liontown Resources’ (LTR) definitive feasibility study (DFS) confirms the Kathleen Valley project as a ‘tier-one’ global lithium project
  • The WA project has a 23-year mine life at an initial 2.5Mtpa processing rate which will ramp up to 4Mtpa in year six and will be supported by $473 million in capital costs
  • Annual spodumene concentrate production will start at 500,000 tonnes per annum but will ramp up to 700,000 tonnes at globally competitive cash operating costs
  • LTR is targeting a final investment decision by Q2 2022 and first production at Kathleen Valley is expected in the first half of 2024 — a full year earlier than outlined in the PFS
  • Company shares are down 6.3 per cent to trade at $1.75

Liontown Resources (LTR) has released a definitive feasibility study (DFS) for its Kathleen Valley project in Western Australia.

Positively for the aspiring global lithium producer, the DFS confirmed Kathleen Valley as a ‘tier-one’ global lithium project with strong financial and technical results, combined with a class-leading sustainability and environmental, social and governance (ESG) framework that is being integrated into development.

The DFS outlined a net present value of $4.2 billion and an ore reserve of 68.5 million tonnes at 1.34 per cent lithium and 120 parts per million (ppm) tantalum for 917,243 tonnes of lithium and 8247 tonnes of tantalum. This supports a 23-year mine life at a planned initial processing rate of 2.5 million tonnes per annum which will ramp up to four million tonnes in the sixth year of operations.

Estimated capital costs increased from $325 million in last year’s pre-feasibility study to $473 million in the DFS. The increase takes into consideration the cost inflation in the resources industry and will allow LTR to rapidly scale up production rates.

The study also highlighted a payback period of 2.3 years and a life of mine, post-tax free cashflow of $12.2 billion.

According to the company, these metrics will see Kathleen Valley become one of the largest new lithium producers globally, with annual production of spodumene concentrate starting at around 500,000 tonnes per annum and ramping up to 700,000 tonnes per year at globally competitive cash operating costs.

“The completion of the DFS marks a major step towards Liontown becoming a substantial global lithium producer,” Managing Director and CEO Tony Ottaviano said.

“We are extremely proud of the work that has been done over the past three years to get to this point especially in regard to the extensive metallurgical test work program which has consistently demonstrated the ability to make 6-6.5 per cent grade concentrate, and I would like to acknowledge the incredible in-house team at Liontown, as well as our consultants, who have worked so hard on the delivery of this world-class DFS.”

Liontown Resources is in the advanced stage of funding discussions and is targeting a final investment decision by the second quarter of 2022. In terms of production, LTR aims to commence production at Kathleen Valley in the first half of 2024 which is a full year earlier than planned in the PFS.

Company shares were down 6.3 per cent to trade at $1.75 at 12:05 pm AEDT.

LTR by the numbers
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