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Battery demand favours hard rock Li: Pilbara

31 Jan 2018 12:19 GMT
Battery demand favours hard rock Li: Pilbara

Perth, 31 January (Argus) — Australian lithium developer Pilbara Minerals believes growth in demand for battery grade lithium favours hard rock lithium producers due to quality advantages.

As cleaner source product, hard rock lithium raw material is better suited to the new quality requirements of the battery world.

"The majority of lithium brine production does not meet battery grade specification and needs more spent on it to achieve higher specifications," the company said.

Pilbara is one of three Australian companies bringing hard rock lithium projects into production in Western Australia this year through the first stage of its Pilgangoora project.

The other two are Altura Mining and the Tawana Resources-Alliance Minerals Assets joint venture. There are three existing hard rock lithium mines in operation in Australia – Mt Marion, Mt Cattlin and Wodgina – which are already shipping spodumene concentrate and direct shipping ore to China.

Most lithium brine output comes from the so-called lithium triangle which spans parts of Argentina and Chile. Western Australia has become the lithium hard rock capital of the world. But several other projects are being developed in Africa, Europe, Canada and elsewhere.

Lithium raw material supply would need to grow by 250pc by 2025 and 500pc by 2030 to meet surging battery industry demand for applications in electric vehicles and energy storage, the company said. It cited research showing that lithium carbonate equivalent (LCE) demand for lithium-ion batteries was expected to grow to 864,000 t/yr in 2026 from 83,000 t/yr in 2016.

A major factor driving lithium demand was concern among established vehicle makers that they could be left behind and shut out of markets if they did not transition quickly enough to electric vehicles. Transitioning to electric vehicles is expected to reduce battery costs and bring electric vehicles closer to price parity with internal combustion vehicles by 2020, Pilbara said.

Factors driving electric vehicle adoption included government incentives, environmental controls, improving battery life and performance and the increasing development of charging infrastructure.

China is the key driver in lowering the costs of lithium-ion batteries as it scales up production. By 2020, there are likely to be four countries producing most of the world's lithium-ion batteries – China (more than 60pc), the US, South Korea and Poland, Pilbara said.

It forecast a significant expansion in facilities for the conversion of spodumene concentrate to lithium hydroxide or carbonate over the next five years.