Downstream dream

It appears there is a lithium boom on and finally, it looks like Australia will get a tangible benefit from doing something other than just quarrying the stuff and shipping it out.
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Australia has a chance to make something, rather than just being a quarry for the rest of the world.

Noel Dyson

To say lithium is running hotter than a laptop battery on a plane is probably an understatement. When veteran mining promoters start talking about the hectares of ground salted with lithium it is clear there is a boom on.

These are the same ones that talked about the pound of uranium they had, then the ounces of gold followed by the tonnes of iron ore that danced to their tune.

Amid this promotional dross there are, of course, the likely success stories and the old hands that have made a strong business out of the hot product of the time.

In iron ore it was the majors. In gold it is the emerging mid tiers bringing new life to pre-loved assets.

In lithium one of the hottest plays going around is Pilbara Minerals with its spodumene saturated Pilgangoora ground.

This was the very company that signalled the fact that mining was back baby when it managed to raise $100 million in a market that seemed to find miners very much on the nose.

However, while the spotlight has been very much on Pilbara Minerals another player has been quietly working away in its shadow, as it has done for a decade or two.

Talison, which is 51% owned by Tianqi (pronounced Tee-an-chee) Lithium Australia, has been given the green light to build a $400 million lithium plant in Kwinana, Western Australia.

The Talison operation – once owned by Sons of Gwalia – supplies about 30% of the world’s lithium.

It may be a surprise to some but Australia ships out virtually raw spodumene ore to China, where it is then upgraded to a grade suitable to battery makers.

While there is processing on lithium operations it only takes the spodumene through to about a 6% concentrate. To get to battery grade it needs to be about 50%.

So the question is why are Australian companies not processing the ore and selling it straight to the battery makers – the likes of Panasonic and Samsung – rather than letting Chinese middlemen do it?

This sort of question was raised by none other that Paul Keating when he made the "banana republic" remark.

One of the reasons is energy cost.

While spodumene is a sought after ore it is not easy to process.

The main way of breaking it out is through roasting, which takes a lot of energy. The ore needs to be heated to about 1100C to get the lithium out.

The Tianqi plant will have the benefit of access to gas from the Dampier to Bunbury Natural Gas Pipeline, which runs through Kwinana.

That plant will process spodumene concentrate from the Greenbushes mine, 250km south of Perth in WA, with a throughput of 24,000 tonnes per annum of battery grade lithium hydroxide.

Perth firm MSP Engineering will be head contractor for the project. It also led the feasibility study for the plant.

Tianqi Lithium Australia general manager Phil thick said construction was expected to start by the end of November.

He said the design, engineering, procurement and approvals processes for the plant were already well advanced.

“Tianqi’s plant will produce the highest quality lithium hydroxide, which is required in the electric vehicle and high end storage markets.

Tianqi’s Chinese parent company lays claim to being the largest producer of lithium chemicals from spodumene. It owns and operates two existing lithium chemical plants in China. The Kwinana plant will expand it processing capability by more than 50%.

Along with approving the building the Kwinana plant, Tianqi’s board has also unveiled plans to expand the Greenbushes mine.

Thick said planning for the state-of-the-art world class lithium plant had taken five years and Tianqi Lithium chose to establish its third plant in Australia for a number of reasons.

“The plant’s close location to the mine is more efficient than transporting the bulk product all the way to China, which also reduces delivery risk so we can efficiently and reliably get product to end markets,” he said.

“The availability of high quality infrastructure and other inputs, plus the accessibility of technical expertise were also contributing factors to the decision to locate the processing plant in Australia.”

Talison is not the only player looking at downstream processing.

Neometals has the Reed Advanced Materials joint venture with Mineral Resources that wants to commercialise its patented Eli Process.

The Eli Process converts spodumene concentrate into a lithium chloride solution and then use electrolysis to produce high purity lithium hydroxide and lithium carbonate. Those are both products used in the lithium ion battery game.

The next step is to build a pilot plant using run-of-mine concentrates from its Mt Marion mine site.

However, while the technology is being developed in Australia any full scale plant using the RAM technology will likely be built in Malaysia rather than at home.

Lithium Australia is another looking to move into lithium upgrading.

Its Sileach process was found by the Australian Nuclear Science and Technology Organisation’s minerals division to extract more than 90% lithium from lepidolite and spodumene.

The output from the Sileach process appears suited for further upgrading to battery level lithium carbonate or even lithium hydroxide.

Lithium Australia is producing a pilot plant with a 3-5kg per hour feed of either lithium ore or concentrate.

Some of the ore for that process will come from Pilbara Minerals’ Pilgangoora ground.

Pilbara Minerals has signed an agreement with Lithium Australia to jointly evaluate the commercial potential of the Sileach process.

One of Pilbara Minerals’ aims is to set up a lithium carbonate and lithium hydroxide plant in Port Hedland in conjunction with partners.

Platypus Minerals is another delving into downstream processing lithium although it is looking at the largely unloved lithium mica ores such as lepidolite and zinnwaldite.

According to Platypus Minerals managing director Tom Dukovcic his company’s L-Max option is the most advanced of the processing options being developed and the only Li-mica processing option of any note.

“L-Max has been proved to work at mini-plant scale on a seven-day continuous closed system run that processed lepidolite ore Lepidolite Hill in WA for Lithium Australia,” he said.

“Further L-Max was used to generate scoping study data on the Cinovec deposit owned by European Metal Holdings and EMH recently [May 2] purchased an option to use L-Max at Cinovex.”

L-Max has been developed by the team that developed the Activox process for nickel sulphides.

The bulk of the Australian lithium processing options though are taking the hydrometallurgical path.

That has its pluses and minuses.

One of the biggest pluses is the need for much less energy because the ore is being dissolved rather than roasted.

There is also the environmental benefits of not roasting.

However, the biggest challenge to these technologies is that they have not really been tested at commercial level.

Lithium Australia and Platypus Minerals are well down the track but there is still a long way to go.

And is there a danger in just locking in to lithium?

After all, Elon Musk, the man behind Tesla cars and the Powerwall household battery systems, has said that lithium is just the salt on the salad.

There are other battery technologies out there using different metals. Nickel hydride batteries, for example, which are used in many hybrid vehicles. There is also the vanadium flow battery technology, which is growing as an alternate way of powering homes and businesses.

Dakota Minerals managing director David Frances, believes the major European car manufacturers have gone too far down the lithium battery path to turn away.

His company has two lithium projects. One, Lynas Find, is not far from Pilbara Minerals’ Pilgangoora ground. The other is in Portugal and that project was chosen for its proximity to the European market, which Frances believes will be a major one.

“There are three lithium markets, Asia, the US and Europe,” he said.

“Electric cars are driving the battery business. In the US guys are driving around in big trucks. Electric cars will be a niche market there, particularly while gasoline is $2 a gallon.

“In Asia China is the only place where there will be big uptake of electric cars but I don’t see Chinese customers wanting electric cars.”

Hence Frances’ move towards Europe.

“Norway has 22% uptake of electric vehicles now,” he said. “The Dutch are trying to pass legislation where you won’t be able to buy an internal combustion engine car after 2025.

“In my mind the curve is wrong. Lithium is the lightest metal so it is perfect for cars.”

Frances said the European car makers had already started to develop the tooling for electric cars with lithium batteries.

Once car makers make that sort of investment it is very hard to move them away from it.