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
Capital costs for the project are now estimated at A$951-million, up from the previous estimate of A$895-million.

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

Latest Developments
Unlisted Hancock Prospecting has achieved its objective of a 19.9% ownership in lithium developer Liontown Resources, as that company extends its due diligence talks with critical minerals major Albemarle.

Hancock is now looking forward to having a "prominent influence on Liontown's future” as the company’s now-biggest shareholder.

Hancock previously expressed its concerns about Liontown’s ability to bring the Kathleen Valley project to fruition, after Liontown warned that capital costs for the project were now estimated at A$951-million, up from the previous estimate of A$895-million. Liontown also shelved plans for a direct shipping ore operation at Kathleen Valley on the back of falling lithium prices, a move which has drawn criticism from Hancock.

It has been widely speculated that Hancock’s increasing stake in Liontown will give the company the leverage to block a takeover offer from critical minerals major Albemarle.

Albemarle is in the middle of a due diligence on Liontown after announcing a A$6.6-billion bid for Liontown, tentatively offering A$3 a share for the ordinary outstanding shares in the company.

Albemarle has been granted a short extension on its due diligence process, following a request from the company. The exclusive due diligence period has been extended by seven days, on the same terms.

Key Contracts, Suppliers and Consultants
ZOOID (environmental, social and 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-Outotec (design, fabrication and delivery of a semiautogenous grinding mill); Lycopodium Minerals (engineering, procurement and construction management); and Zenith Energy (hybrid power station – design, build, own, operate and maintain).

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