Lithium Australia NL (ASX:LIT) expects to start pilot plant trials for its Sileach™ lithium extraction process in the next few weeks.
The test work is being conducted at the ANSTO Minerals facility in Lucas Heights, New South Wales.
Installation of major equipment and cold commissioning is complete with hot commissioning in the process of being completed.
Initial pilot testing will take place at the ANSTO Minerals facility after which a decision is to be made to proceed with construction of a larger-scale pilot plant, for which Port Hedland is currently the preferred location.
Commercialising Sileach™
The Sileach™ process is designed to recover lithium from silicates without the expensive roasting step that has long been the main stay of the lithium recovery process.
ANSTO Minerals, a division of the Australian Nuclear Science and Technology Organisation has partnered with Lithium Australia to develop the Sileach™ processing technology.
Agreement with Pilbara Minerals
Lithium Australia made an agreement with Pilbara Minerals Ltd (ASX:PLS) who will supply spodumene concentrate for a pilot testing phase.
Subject to the success of pilot testing of concentrates, the parties have agreed to establish the Sileach Joint Venture (SJV) with the aim of developing a commercial Sileach™ processing plant.
Obligations of the parties as per the agreement are as follows:
Initial pilot tests at ANSTO Minerals:
- LIT will cover the capital cost of pilot testing;
- PLS will supply the required spodumene concentrates for testing; and
- Operating costs for the tests will be split 50/50.
Large-scale pilot testing:
- Plant designed to produce commercial lithium carbonate and recover by-products;
- LIT to cover capital cost of the plant;
- PLS to provide the spodumene concentrates; and
- Costs to be recovered as follows: Firstly recovering capital costs; Secondly recovering operating costs; and Thirdly, paying PLS cost price for the spodumene concentrate.
Definitive Feasibility Study
Data generated from operating the large-scale pilot plant will be used for feasibility investigations into the construction of a full-scale commercial Sileach™ processing plant.
Commercial Sileach™ processing plant
In the event of a positive outcome of the definitive feasibility study, the SJV will advance to commercial production, including finance and construction, on a 50/50 basis.
Next steps for Sileach™
The next steps on the timeline to commercialise the Sileach™ process are:
- Finalising construction of the pilot plant with ANSTO (Q3 2016);
- Operating the pilot plant (Q3-Q4 2016);
- Completing the study (Q4 2016); and
- Deciding whether to proceed to a continuous, site-based pilot plant (Q1 2017).
Lithium Australia portfolio
Lithium Australia now has projects in the following jurisdictions:
- Western Australia: The Gascoyne; Pilgangoora; Ravensthorpe; Seabrook; Lepidolite Hill;
Greenbushes; Lake Johnston; and Widgiemooltha projects;
- Northern Territory: Bynoe;
- Queensland: Cape York; and
- Mexico: A 25% interest in the Electra lithium project.
Within these projects the company has various corporate alliances and joint ventures with Pilbara Minerals Ltd (ASX:PLS), Focus Minerals Ltd (ASX:FML), Alix Resources Corp (CVE:AIX), Cazaly Resources Ltd (ASX:CAZ), Tungsten Mining NL (ASX:TGN) and Venus Metals Corporation Limited (ASX:VMC).
Analysis
The upcoming initial pilot test work at the ANSTO facility will provide key data in evaluating the commercial future and value of the Sileach™ process.
Test work to date has already shown extraction of greater than 90% lithium which can then be processed into a high quality lithium carbonate.
Furthermore, the federal government is supporting the commercialisation of the process with research grants and the state government is assisting with site procurement for the initial processing plant.
Lithium Australia's goal is to be a lowest quartile lithium carbonate producer.
By using the Sileach™ process to produce lithium carbonate from hard rock lithium ores, which conventionally require energy intensive processing, it aims to lower the cost of production.
The successful development of a commercial process to recover lithium from spodumene would place Lithium Australia at the leading edge of the lithium industry.
The company is positioned well within a strong lithium market, developing both, processing technology that is potentially applicable on a global scale, and growing a portfolio of lithium projects.
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