Australian lithium producer Liontown has reached a final investment decision (FID) to expand its Kathleen Valley lithium project in Western Australia (WA), the company said today.
The A$389mn ($272mn) expansion will boost Kathleen Valley's lithium ore processing capacity from 2.8mn t/yr to 4.2mn t/yr. Liontown is aiming to produce an average of 780,000 dry metric tonnes/yr (dmt/yr) of lithium concentrate (spodumene) 5.4pc over the five years from the July 2029-June 2030 financial year, up from 392,000dmt in 2025-26.
The expansion will include a A$145mn investment into mine development, resource definition drilling and enabling infrastructure, alongside A$244mn earmarked for upgrades to processing infrastructure, power distribution, water and accommodation.
Liontown expects to recover upfront costs for the expansion within 2½ years from the end of construction, it said, adding that the expansion was supported by improved market conditions.
Construction for the expansion has started, Liontown said, with completion targeted by early 2029.
Multiple Australian lithium producers have restarted operations this year due to sustained improvements in lithium market conditions, driven by growing demand in the electric vehicle and battery storage sectors.
Liontown left its 2026-27 guidance for lithium concentrate production and unit operating costs steady at 390,000-440,000dmt and A$1,050-1,250/dmt, respectively. It expects capital expenditure to reach A$435mn-495mn, up from A$320mn-370mn, accounting for expansion capital approved for the FID.
Argus assessed lithium concentrate (spodumene) 5-5.5pc Li2O at $1,613/t fob Australia on 29 September, down by $99.50/t on the week.
