Mineral Resources Limited’s (MRL) has agreed this week with its partners Albermarle Corp and Ganfeng Lithium to boost the spodumene output from its Mt Marion Lithium mine, in response to the surge in lithium demand.
The Mt Marion Lithium site, located 40km south-west of Kalgoorlie in the Goldfields region of Western Australia, underwent an upgrade in 2018-2019 to increase its nameplate capacity to 450,000 tonnes per annum. Under this new agreement, that figure will rise to 600,000 tonnes this month.
What is more, the joint venture will look to expand that spodumene concentrate capacity to 900,000 tonnes a year by the end of 2022.
Image: Mineral Resources Limited / Twitter
The global energy transition has companies and governments looking to invest the raw materials required for battery energy storage, not just for large and small-scale applications but particularly for the enormous uptake in electric vehicles (EVs) predicted to happen this decade. This demand has caused an enormous price spike in lithium, which is extracted from the mineral spodumene.
“For some time now the world has seen extraordinary demand for lithium, driven by the strength of the electric vehicle market” said MRL managing director Chris Ellison. “This demand has resulted in a substantial increase in lithium prices, with pricing expected to remain strong for the rest of this decade.”
In an announcement to the ASX MRL said the expansion is “in response to unprecedented global customer demand for lithium products” which will see it “increase production from the Wodgina and Mt Marion spodumene mines”. The necessary upgrades will cost less than $120 million.
Image: Mineral Resources Limited / Twitter
“With a world-class portfolio of highest-quality, long-life lithium assets in a Tier 1 mining jurisdiction,” continued Ellison, “we are well positioned to capitalise on the continued growth of the global electric vehicle market.”
China is currently the world’s biggest refiner of lithium, controlling about 80% of the market, according to a 2020 study from BloombergNEF.
In 2019 the lithium market plummeted due to oversupply, but that seems to have only been a false start on widespread EV uptake.
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