A new wave of UK mining projects for critical minerals production is progressing steadily towards final commercial decisions, supported by high metal prices and increased government support amid rising concerns over global availability. But planning permission is a major challenge that most in the sector need to overcome.
Multiple projects showcased at the Cornish Mining Conference in Falmouth last week have secured significant early-stage funding support and pending feasibility studies are targeting first commercial operations in the second half of this decade.
The most advanced projects are being developed by Cornish Lithium, which last month secured a $67mn funding round to support its Trelavour hard-rock lithium mine and multiple lithium brine extraction projects.
The Trelavour project aims to complete a feasibility study next year and reach a final investment decision at the same time. If positive, Cornish Mining will proceed with a second-phase funding round of $210mn and commence construction with the aim of entering commercial production by the end of 2026 or early 2027. The plant will produce approximately 8,000 t/yr of battery-grade lithium hydroxide.
The company is also working on multiple direct lithium extraction (DLE) projects to produce lithium chloride solution through the extraction of brine from granite deposits using geothermal technology. Each site could produce 500-1,000 t/yr of lithium carbonate equivalent.
Cornish Lithium chief executive Jeremy Wrathall told Argus last week that the company is encouraged by progress on these projects to the extent that they could be sped up and enter production at around the same time as the Trelavour operations come on line. The company is considering creating a well array of 20-30 boreholes that feed into a central processing site.
The government-backed UK Infrastructure Bank invested $30mn in Cornish Lithium's latest funding round and Wrathall said government support for the minerals sector has improved significantly in the past year.
"The penny has dropped," he said. "The [Somerset gigafactory] from Tata has been funded, the Oxford BMW [electric] Mini plant funded, us funded. You've seen more and more recognition of how important critical minerals are. If you've got them here, why would we not try and exploit them because it creates jobs and economic prosperity. I think the government is doing a good job now, it may have been jolted into that by the EU's [proposed] Critical Raw Materials Act but I think it's stepping up really well."
Rising demand for lithium from the battery sector means that prices remain historically strong despite falling sharply this year from 2022, when the market surged to more than $80,000/t ex-works China for minimum 56.5pc lithium hydroxide. The Argus assessment for lithium hydroxide was Yn168,000-Yn183,000/t ($23,069.96-25,129/t) on 18 September, well in excess of the $11,000-12,000/t breakeven price for Cornish Lithium's Trelavour project.
Other UK mining companies moving into more advanced development are British Lithium, which in June sold an 80pc stake to global mineral speciality solutions provider Imerys, which already has a large mining footprint in Cornwall. British Lithium is developing a mine that could produce 20,000 t/yr of LCE. Chief executive Andrew Smith told the Cornish Mining Conference that it is in the process of submitting initial planning permission documents and aims to complete its pre-feasibility study for the project by the middle of next year, with a longer-term goal of entering commercial production by 2027-28.
A third firm, Cornish Metals, raised £40.5mn for its South Crofty tin project in Cornwall in May 2022 and its chief executive Richard Williams said last week that the company aims to complete its feasibility study by the end of 2024 and enter commercial production of 4,000-5,000 t/yr by the end of 2026. Williams told Argus that South Crofty's breakeven price is significantly lower than the $25,000/t mark around which the three-month London Metal Exchange tin price has traded for most of 2023.
South Crofty is fully permitted, which means that it is less exposed to what Wrathall describes as the greatest challenge facing new UK mining projects.
Tungsten West, owner of the Hemerdon mine in Devon, England, which has the world's third-largest tungsten deposit, warned last week that if it cannot secure the necessary permits by December it will be unable to secure the financing it needs and will be at risk of insolvency.
The restart of mining at Hemerdon has met strong opposition from residents at nearby villages concerned about noise pollution, traffic and waste in dust.
The companies developing the Cornish mines hope that carefully planned brownfield development co-located with other industrial operations combined with greater in-built support from an area seeking to rejuvenate its economy will help limit the scope of permitting issues.
"We have a very engaged council and a community that largely supports mining as it's been here for 4,000 years," Wrathall said.
