PERTH (miningweekly.com) – Early work on the phased expansion of ASX-listed Pilbara Minerals’ Pilgangoora lithium project, in Western Australia, has estimated that the Stage 2 expansion would cost between A$200-million and A$250-million.

The Stage 2 expansion will see an additional three-million-tonne-a-year processing circuit added to the existing Stage 1 operation, taking the project capacity to five-million tonnes a year.

Pilbara last year announced plans to sole fund the expansion after failing to nail down a partnership transaction that offered the "appropriate valuation" for the Pilgangoora project.

The ASX-listed company is currently undertaking technical studies on an incremental pathway for the Stage 2 expansion, which will reduce the upfront capital cost and align subsequent phases of the expansion with customer requirements.

Pilbara currently anticipates that the Stage 2 expansion would be undertaken over three incremental phases, the first of which would increase concentrate capacity by a further 100 000 t/y, at a cost of between A$60-million and A$70-million.

The second phase of the expansion would add 40 000 t/y to 50 000 t/y capacity, at a cost of between A$20-million and A$30-million, while the third phase would add a further 330 000 t/y to 370 000 t/y capacity at a cost of between A$140-million and A$150-million.

The current technical studies for the phased Stage 2 expansion is expected in March of this year.

Meanwhile, Korean major POSCO has also indicated that it would undertake an additional technical review at its existing demonstration plant, and would further evaluate the lithium market, before obtaining final approval for a downstream joint venture with Pilbara.

The two companies are hoping to jointly develop a 40 000 t/y lithium carbonate equivalent chemical conversion facility in South Korea, with Pilbara to have up to a 30% participating interest in the downstream facility.

POSCO is expected to gain final approvals for the jointly developed processing facility by June this year.

Meanwhile, Pilbara on Thursday announced that spodumene concentrate production during the December quarter had declined to 14 711 t, compared with the 21 322 t produced in the previous quarter, while shipments were up from 20 044 t to 33 178 t in the same period.

Run-of-mine stockpiles have decreased from 775 992 t to 739 466 t, while spodumene concentrate stocks have declined from 52 450 t to 25 730 t.

“While soft conditions in the global lithium market persisted throughout the December quarter, we made important progress operationally to ensure the company is well placed to capitalise on the turnaround in market conditions, when that occurs,” said Pilbara MD and CEO Ken Brinsden.

“An outstanding achievement was the successful completion and commissioning of the most recent phase of process plant improvement works, which delivered a significant uplift in lithia recoveries during production activities, with an average sustained lithia recovery of 67% realised and a lithia recovery range of 63% to 73% achieved during periods of steady-state operations.

“These recovery results are materially higher than that achieved to date and reflect the extensive technical input, hard work, and key operational learnings applied by Pilbara’s team.”