Prices for spodumene concentrate and lithium raw materials continued to surge in the March 2022 quarter, hitting record highs on the back of strong demand from the electric vehicle (EV) sector.
Data from Benchmark Mineral Intelligence shows battery-grade lithium carbonate (EXW China, ≥99.5% Li2CO3) averaging US$76,700 a tonne in March 2022 - up 95% since the start of the calendar year.
In March 2021 it was trading at US$13,400 a tonne.
Price of lithium has gone to insane levels! Tesla might actually have to get into the mining & refining directly at scale, unless costs improve.
There is no shortage of the element itself, as lithium is almost everywhere on Earth, but pace of extraction/refinement is slow.
— Elon Musk (@elonmusk) April 8, 2022
In the spotlight: ASX lithium stocks
ASX-listed lithium plays have ramped up their activities during the March quarter as demand surged and have laid out their plans for the future.
Lithium Power International
Lithium Power International Ltd (ASX:LPI) completed the Definitive Feasibility Study (DFS) during the March 2022 quarter for its Maricunga Stage One Lithium Brine Project in northern Chile.
The study confirmed that the operation would be one of the world’s lowest-cost producers of lithium carbonate, along with a solid ESG strategy to support a sustainable future.
LPI’s updated DFS supports 15,200 tonnes per annum production of lithium carbonate (LCE) for 20 years.
The project has an NPV (leveraged basis) of US$1.425 billion (after-tax) at an 8% discount rate, providing an IRR of 39.6% and a two-year payback with a steady-state annual EBITDA of US$324 million.
Core Lithium
Core Lithium Ltd (ASX:CXO) was focused on a number of initiatives during the March quarter aimed at advancing the construction stage of its wholly-owned Finniss Lithium Project, near Darwin in the Northern Territory.
During the March quarter, Core:
- Reached a landmark binding term sheet with US electric vehicle maker Tesla;
- Advanced construction activities at the Finniss Project;
- Completed the acquisition of highly prospective Mineral Leases adjacent to Finniss; and
- Reported significant drill results at BP33 and Carlton deposits.
Liebherr R 9200 excavator arrives on-site at the Finniss Project.
Jindalee Resources
Jindalee Resources Ltd (ASX:JRL)’s McDermitt Lithium Project is the second-largest lithium deposit in the US with a resource of 1.43 billion tonnes at 0.28% lithium oxide at a 1,000 ppm lithium cut-off for 10.1 million tonnes LCE Equivalent.
Recent drilling has confirmed significant additional mineralisation near surface over large thicknesses at McDermitt which will underpin a resource update anticipated in the June quarter.
Jindalee continues to advance the project with key non-drilling activities including baseline environmental studies already underway.
Infinity Lithium Corporation
Infinity Lithium Corporation Ltd (ASX:INF) produced increased quantities of battery-grade lithium chemicals from the completion of metallurgical test-work at the San José Lithium Project in Spain.
The next stage of testing will progress locked cycle test-work and advancement of the engineering design criteria for feasibility study level studies for processing in combination with an underground operation providing lithium-bearing mica ROM to feed a fully integrated, on-site lithium chemical conversion plant capable of producing both battery-grade lithium carbonate and hydroxide.
Underground studies are at scoping study level currently with processing test-work and design significantly advanced, thus de-risking the project greatly.
Anson Resources
During the quarter, Anson Resources Ltd (ASX:ASN) maintained its core focus on its resource expansion drilling programs, which are designed to deliver a significant resource upgrade at Paradox Lithium Project in Utah, USA.
The company has started a major resource expansion drilling campaign, initially targeting the Long Canyon No.2 (LC2) well.
Drill rig at the Long Canyon No.2 Well.
The results from the drilling program are designed to be included in the ongoing DFS at the Paradox Project and continue the development of the project into a substantial lithium producing operation.
European Lithium
European Lithium Ltd (ASX:EUR, OTCQB:EULIF) is planning to step-up activities at the Wolfsberg Project in Austria in a bid to increase the lithium resource base.
EUR aims to complete an assessment and initiate the approval process by submitting a drilling proposal to the authorities.
During the March quarter, the company continued to work with its DFS team based in Europe, South Africa and Canada to progress all areas of the DFS.
Following the quarter end, EUR released an interim DFS update announcement on the major DFS KPIs including a pre-tax NPV6 for the accelerated case of A$862 million, a maximum of 20 years life of mine and a mining rate of about 770,000 tonnes per annum.
AVZ Minerals
In early February 2022, AVZ Minerals Ltd (ASX:AVZ) committed to invest A$25 million to advance its drilling program on the Roche Dure deposit within the Manono Project in the DRC, using funds received from its A$75 million capital raising in December 2021.
The A$25 million investment is aimed at maintaining the Manono Project development schedule, as well as funding an extension drilling program at Roche Dure, which has the potential to significantly expand the previously reported 2012 JORC Mineral Resource and Ore Reserves.
Latin Resources
At Latin Resources Ltd (ASX:LRS)’s Salinas Lithium Project in Brazil, the company’s maiden diamond drilling program commenced during the March quarter with 14 holes planned for a total of 2,000 metres.
The drilling has confirmed multiple zones of spodumene pegmatites and high-grade lithium assays were returned.
Following the quarter end, additional tenure was secured with a further 50-hectare lithium tenement, to the east of its existing position in the highly prospective Bananal Valley district.
Critical Resources
Critical Resources Ltd (ASX:CRR) received the green light for drilling at its Mavis Lake Lithium Project in Ontario, Canada during the March quarter, where the company has started 5,000 metres of diamond drilling targeted at known lithium pegmatites.
Spodumene was intercepted throughout a pegmatite intercept of 7.63 metres in the first drill hole MF22-60, visually white to grey and estimated to contain about 25% of medium to large spodumene crystals.
Critical Resources managing director Alex Biggs believes that Mavis Lake has the potential to be a transformational asset for the company and is committed to defining a JORC-compliant resource.
Lake Resources
Lake Resources NL (ASX:LKE, OTCQB:LLKKF) uses disruptive, direct extraction technology (DLE) from its partner, Lilac Solutions Inc in California, who is earning into Lake’s flagship Kachi Project in Argentina, for efficient production of high purity lithium with significant ESG benefits.
Production from the Kachi Lithium Brine Project is targeted to commence in 2024 at an annual rate of 50,000 tonnes lithium carbonate.
Kachi is indicatively financed into production with long-dated low-cost project finance from the UK Export Finance and Canada's EDC for about 70% of the total finance required for Kachi’s development.
Lithium Australia
Lithium Australia subsidiary VSPC Pty Ltd recently selected global engineering and project delivery entity Lycopodium (ASX:LYL) to provide engineering support services for the DFS for a potential lithium ferro phosphate (LFP) manufacturing facility.
The DFS for the 10,000 tonnes per annum facility is well underway and activities have been expanded to include early-stage, semi-commercial LFP production, to support the final stages of product pre-qualification.
Lithium Australia also owns Envirostream, Australia’s only EPA-permitted and licensed recycler of mixed batteries, including lithium-ion batteries.
Envirostream is well-placed to keep spent batteries out of landfills while providing as much sustainable feed material as possible for the manufacture of new lithium-ion batteries.
