Mineral Resources and NYSE-listed Albemarle Corporation plan to restart production at their dormant Wodgina lithium mine in a show of confidence for the commodity’s long term outlook.
Mineral Resources and NYSE-listed Albemarle Corporation plan to restart production at their dormant Wodgina lithium mine in a show of confidence for the commodity’s long term outlook.
The mine, which is situated 120 kilometres south of Port Hedland, was placed under care and maintenance in 2019 due to weaker global market conditions and oversupply at the time.
Mineral Resources sold off a portion of the mine to form a 40/60 exploration and development partnership with Albemarle that year, which now hosts the project under the MARBL Lithium Joint Venture.
Some two years later and on the back of today’s announcement, first spodumene concentrate production is tipped for the third quarter of 2022.
The venture’s initial focus will be on restarting one of Wodgina’s three 250,000 tonnes per annum processing lines, which may be increased subject to market demand.
At fully capacity, Wodgina can produce roughly 750,000tpa.
Mineral Resources estimates 200 new full-time jobs will be needed to get the project up and running.
Mineral Resources managing director Chris Ellison emphasised his company’s decision to take the mine offline.
“It was the correct decision in late 2019 to place Wodgina on care and maintenance though it never dented our confidence in lithium’s long-term positive demand fundamentals,” Mr Ellison said.
“As we said at the time and repeat today, in Albemarle we have the best partner to deliver maximum and sustainable value from world-class assets like Wodgina.”
The MARBL joint venture also includes construction of a 25 kilotons per annum lithium hydroxide plant in Kemerton, which is set to joint three other tabled lithium plants in the state.
In a signal to its outlook for the commodity, the project’s majority owner Albemarle also flagged intent to expand its lithium conversion capacity by signing investment agreements with two industrial facilities in China.
The company plans to build a conversion plant at each site to produce an initial 50,000 metric tonnes of lithium hydroxide per annum.
Construction for Albemarle’s plants is set to start in 2022 and wrap up by the end of 2024.
Under the terms of the MARBL joint venture, MRL’s Mining Services business will provide crushing and camp services at Wodgina while Albemarle will market 100 per cent of the output from Wodgina.
Mineral Resources shares are up 8.53 per cent to trade at $42.75.
