PERTH (miningweekly.com) – China’s Tianqi Lithium has launched its lithium hydroxide plant in Kwinana, Western Australia, but has slowed plans for the second-stage expansion as lithium prices decline.

Tianqi has reportedly stopped work on a part-build $300-mllion second stage of the plant, instead focusing on the commissioning of the Stage 1 operation, and on achieving practical completion by the end of October.

Tianqi president Vivian Wu was quoted as saying that the company had no doubts about demand for lithium hydroxide over the long term.

“We expect significant growth in the lithium market, driven primarily by electric vehicles and energy storage, over the next ten years, and with the Kwinana pant we are very well placed to take significant advantage of that,” she was quoted by The Financial Review.

Once fully operational, the two-stage plant will produce 48 000 t/y of battery grade lithium hydroxide and is expected to generate around A$800-million a year in exports, at current prices, and employ 175 permanent staff.

Tianqi and its joint venture partner Albemarle earlier this year also pushed pause on the planned A$516-million expansion of the Greenbushes lithium mine, also in Western Australia, as the two companies reconsidered downstream processing capacity, while Albemarle also reported that it would cut investment plans for lithium processing at Kemerton, also in Western Australia.

"We know that lithium is critical in renewable energy storage and electric car batteries, and we want to ensure Western Australia is at the forefront in the battery value chain and strengthen our position as a world leader in exports of future battery minerals, materials, technology and expertise,” Western Australian Premier Mark McGowan said this week.

"We are engaging with industry representatives in mining, downstream processing, chemical manufacturing, construction, energy and the unions to ensure the Future Battery Industry Taskforce responds to industries' needs locally and overseas."

There are five lithium hydroxide plants in consideration in Western Australia, including Tianqi's Kwinana lithium hydroxide plant.

Lithium was Western Australia's sixth largest minerals sector in 2018.