Australian metals producer IGO said May 20 that it had achieved the first production of battery-grade lithium hydroxide from the Kwinana Lithium Hydroxide Refinery in Western Australia.
Qualification work with off-take customers will be subject to the independent verification of product samples, a Sydney-listed company said.
Platts on May 20 assessed CIF North Asia lithium carbonate at $76,000/mt and CIF North Asia lithium hydroxide at $80,200/mt, S&P Global Commodity Insights data showed.
The refinery is a 51:49 joint venture between Chinese lithium producer Tianqi Lithium Corp. and IGO.
“Vertical integration into downstream processing is a key plank of IGO’s strategy and we are proud to be involved in the initial commercial production of lithium hydroxide in Australia,” IGO chief executive Peter Bradford said in a statement. “This integrated lithium business, with interests in both the upstream and downstream, the upstream lithium mining asset at Greenbushes and the downstream refinery at Kwinana, is developing into a world-class integrated lithium business.”
"RBC Capital Markets analyst said in a research note: "We see this as an important de-risking milestone for the plant and Lithium Joint Venture.
Typically, liberating lithium/producing hydroxide is a complex process, and we view the biggest operating risk for the Lithium JV at the moment as the Kwinana plant’s capacity to deliver battery grade hydroxide at name plate (design recovery rate, production and cost). Key Step Towards Name Plate Production RBC said the first step is to ramp up to name plate, which it described as producing battery-grade hydroxide out of the plant for a limited period.
IGO had previously guided commercial production in FY2023, according to the bank.
"We expect: 1) commercial production 09Q22, 2) battery grade 50% of hydroxide (by DecQ22), 3) hydroxide accreditation process timeframe of 6 months, 4) Train 1 ramp to name plate (24,000 mt/year, 100%) SeptQ23 (no changes to RBC estimate made)," RBC analysts, who believe the ramp-up of the Kwinana plant with elevated Lithium hydroxide prices will support FCF generation for the Lithium JV/IGO through FY23 and beyond, said.
Tianqi Lithium on May 9 reached a five-year strategic cooperation agreement with China Aviation Lithium Battery Co., the country’s leading power battery supplier, in a deal that allows the companies to form an integrated value chain in the lithium industry.
IGO also said on Feb. 21 it was in talks to buy Glencore’s CSA copper mine in New South Wales, but it ended negotiations a week later, with Melbourne-based Metals Acquisition Corp. now the sole bidder for the mine.
