Pilbara Minerals advances mine upgrades

Lithium miner Pilbara Minerals will use a $US15 million prepayment from one of its offtake partners to fund plant improvements at its Pilgangoora operations.

The deal involves Pilbara Minerals expanding its five-year offtake with emerging Chinese supplier Yibin Tianyi Lithium, from 75,000 tonnes of spodumene (lithium) concentrate to 115,000 tonnes per annum.

The raised amount accounts for the production increase expected for Pilgangoora, following the stage one plant improvements.

The works are being undertaken by a local joint venture between SIMPEC and indigenous-owned IronMerge, with the improved plant to be operational in the September quarter, Pilbara Minerals said.

"Our relationship continues to grow with Yibin Tianyi as we work together in support of both our businesses' growth ambitions," Pilbara Minerals managing director Ken Brinsden said.

He said Yibin Tianyi planned to become one of the biggest lithium chemical suppliers in China and Pilbara Minerals one of the largest, lowest-cost raw lithium suppliers in the world.

The $US15 million ($A19.4 million) prepayment from Yibin will be available for drawdown by March 31.

Shares in Pilbara Minerals closed up 3.9 per cent to trade at $1.08.