- Pilbara Minerals shares are up today, following its first AGM since production began at its Pilgangoora Project in the Pilbara
- The Lithium-Tantalum project began production in April and mines resources needed for batteries and electric vehicles
- However, the company decided to moderate production in June, due to declining prices for lithium chemicals in China and delays from offtake partners
- The company is confident nevertheless, with a new offtake agreement in China and plans for a joint venture in South Korea
- Shareholders seemed pleased, with company shares trading 4.25 per cent higher, worth 30.8 cents apiece
Pilbara Minerals shares are up today, following its first AGM since production began at its Pilgangoora Project in the Pilbara.
Commercial production began at the Lithium-Tantalum project in April, producing spodumene concentrate and tantalite concentrate. These products are used in the production of batteries required for electric vehicles.
In June, however, the company decided to moderate production due to declining demand. In China, a key offtake market, prices for lithium chemicals fell.
Furthermore, other offtake partners were delayed in the manufacture of their processing facilities.
Pilbara Minerals, however, made lemonade of the situation, using the reduced production period to upgrade manufacturing facilities at the project. As a result, lithia recovery has been increased and therefore operating costs reduced.
In terms of production rates going forward, the company said it will hold off making any change to the current pace, until demand increases.
Looking forward, the company completed a feasibility study for the Stage 2, 5Mtpa expansion, in addition to a scoping study for a Stage 3, 7.5Mtpa expansion. Both yielded encouraging results according to the explorer.
Pilbara Minerals also secured a new strategic investor, Contemporary Amperex Technology, which is China’s largest electric vehicle battery manufacturer. A new offtake agreement with Great Wall Motors was also secured, demonstrating strong Chinese interest in the lithium products.
Further implication in Asian markets came in the advancement of a potential joint venture with POSCO in a chemical conversion facility in South Korea.
The Final Investment Decision for the joint venture is expected to be made in early 2020.
Pilbara Minerals shareholders seemed pleased with company shares trading 4.25 per cent higher, worth 30.8 cents apiece.