Photo by: Western Lithium
TORONTO (miningweekly.com) – Canadian firm Western Lithium USA this week ceremoniously cut the ribbon to its Hectatone organoclay plant in Fernley, Northern Nevada, as part of its strategy to supply specialty clays before year-end to the oil and gas sector, before adding battery-grade lithium to its product line-up from 2018 onwards.
The TSX-listed firm’s Hectatone business had been developed to provide viscosifier technology to the directional drilling industry. Directional drilling is the technology that had opened up vast reserves of oil and gas in the US and around the globe.
Western Lithium on Friday reported that construction of the Hectatone plant was now complete and mechanical commissioning and safety inspections were near completion. The plant was expected to start semicontinuous operations in the coming weeks.
“The start-up of the plant is progressing according to plan. We expect to begin shipping Hectatone finished products in November to meet initial customer orders,” Hectatone president Frank Wright Jr said in a statement.
Western Lithium CEO Jay Chmelauskas added that, owing to the US continuing to develop its domestic reserves of oil and natural gas using directional drilling technology, followed by the rest of the world, the company saw “tremendous” opportunities for its Hectatone business.
He noted that Hectatone was only the company’s first chemical plant investment in Nevada.
“Our next major chemical plant investment in Nevada is focused on advancing our lithium carbonate and hydroxide projects to support the growth of the lithium-ion-battery manufacturing sector that is developing in Nevada and internationally,” Chmelauskas said.
Western Lithium had completed a prefeasibility study (PFS) of its Kings Valley project, which was the source of the company’s lithium-bearing clays. The PFS examined lithium extraction from the deposit to produce lithium carbonate, mainly intended for the lithium battery sector.
As part of its initial lithium-extraction process-engineering efforts, Western Lithium last month started commissioning a lithium demonstration plant in Germany. First trial production of lithium carbonate was expected in November.
The company planned to run three lithium production campaigns to produce lithium carbonate and lithium hydroxide for lithium-ion battery applications. Western Lithium pointed out that it was currently in discussions with potential partners to accelerate its lithium development activities in Nevada.
Dovetailing into its plans to become a major supplier of battery-grade lithium in the state was electric vehicle manufacturer Tesla Motors’ plans to build a $6-billion lithium-ion battery ‘gigafactory’ to satisfy its aggressive projections to produce about 500 000 electric vehicle batteries a year by 2020.
Tesla had last month inked a deal with the state of Nevada to become the official site for the Tesla gigafactory.
Despite being down 5% at C$0.76 a share on Friday, Western Lithium's TSX-listed stock had appreciated by 248% since the start of the year.