Name of the Project                                    
Kathleen Valley lithium/tantalum project.

Location
North-east Goldfields of Western Australia.

Project Owner/s
Lithium developer Liontown Resources.

Project Description
A definitive feasibility study (DFS) has confirmed the potential to develop a state-of-the-art, second-generation lithium/tantalum mining and processing operation.

The DFS optimises the mine schedule, process plant design and forecast sales pricing to enhance the technical and financial viability of a standalone, long-life, four-million-tonne-a-year operation.

The project has an ore reserve of 68.5-million tonnes grading 1.34% lithium oxide and 120 parts per million tantalum pentoxide, underpinning an initial estimated 23-year mine life, based on the updated mining schedule.

Building on the October 2020 prefeasibility study (PFS), the DFS base production has been increased from two-million tonnes a year to 2.5-million tonnes a year, producing about 500 000 t/y of spodumene concentrate, with a four-million-tonne-a-year expansion planned in Year 6 to deliver about 700 000 t/y spodumene concentrate.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has an after-tax net present value, at a real 8% discount rate, of A$4.2-billion and an internal rate of return of 57%, with a payback of 2.3 years.

Capital Expenditure
In June 2022, Liontown flagged a cost increase in the project from the A$473-million estimated in the 2021 DFS to A$545-million.

Planned Start/End Date
First production is expected to start in the first half of 2024.

Latest Developments
Liontown Resources is confident that it can execute its Kathleen Valley project within the set timeframe and within the new budget.

The miner at the end of June took a final investment decision on the Kathleen Valley project, but flagged a cost increase in the project from A$473-million to A$545-million.

The increase is driven primarily by optimisation and expansion of the front-end engineering design (FEED) scope across a range of areas and general cost escalation.

The company is also confident that it can maintain its production start target of the second quarter of 2024.

“We've allowed for escalation. Our FEED and our DFS were done during the hottest part of the market. We believe we factored in reasonable escalation into our capital costs to give us the new figure of A$545-million,” Liontown MD and CEO Tony Ottaviano has said.

Ottaviano has said that Liontown’s main focus is on the delivery of the Kathleen Valley project, but once this has been completed, the company’s focus will shift to downstream opportunities.

The company has started a PFS around downstream potential.

Ottaviano has said that Liontown is likely to partner in the downstream processing opportunity, and will bring in a partner that will not only provide capital, but expertise.

The downstream PFS will focus on not only the location of the proposed downstream facilities, but also on the ultimate product to be delivered through the process.

“Whether that chemical is hydroxide or an intermediary product that's part of the PFS, and whether we locate the plant next to the site in Geraldton or Kalgoorlie, that'll be part of the PFS,” Ottaviano explains.

Key Contracts, Suppliers and Consultants
ZOOID (environmental social governance); Optiro (geology and mineral resources estimate); Snowden Mining Industry Consultants (mine optimisation, planning, design and scheduling); ALS Metallurgy (process testwork); Lycopodium Minerals (process and infrastructure design, capital and operating expenditure); Knight Piésold (tailings and hydrogeology); MBS Environmental (environmental studies); Peter O’Bryan and Associates (geomechanical engineering); Metso-Ouotec (design, fabrication and delivery of a semiautogenous grinding mill) and Lycopodium Minerals (engineering, procurement and construction management).

Contact Details for Project Information
Liontown Resources, tel +6 8 6186 4600 or email info@ltresources.com.au.