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IGO reports a strong start to 2022

1st November 2021

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

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PERTH (miningweekly.com) – ASX-listed Independence Group (IGO) has reported a sold start to the 2022 financial year, following the divestment of its stake in the Tropicana gold project, in Western Australia, and the completion of its transaction with Tianqi Lithium Corporation over its Australian lithium assets.

“We are pleased to have commenced the 2022 financial year strongly with a solid quarter of safe performance from Nova. In parallel, good progress was achieved within the lithium joint venture (JV), with key growth projects being advanced during the first reporting period following the successful completion of IGO’s investment in the lithium JV with Tianqi Lithium Corporation,” said IGO MD and CEO Peter Bradford.

“At the greenbushes lithium mine, chemical grade plant 2 has been commissioned, tailings retreatment plant construction activity was progressed with commissioning expected in early 2022, and the engineering, procurement and construction management (EPCM) contract for the design and engineering for Chemical Grade Plant 3 was awarded to Lycopodium.

“At the Kwinana refinery commissioning of Train 1 has been progressed with a key milestone achieved during August with the first lithium hydroxide produced. During this period, we have witnessed increased global demand for lithium, with prices responding strongly.

“At Nova, quarterly nickel production and cash costs were better than pro-rata guidance which, combined with robust commodity prices, resulted in Nova continuing to achieve strong free cash flows and high margins. The guided lower production quarter-on-quarter reflects the mining of lower-grade stopes in line with the life of mine plan,” said Bradford.

Nickel production at Nova declined by 13% compared with the June quarter, from 7 887 t to 6 889 t, while copper production declined 15%, from 3 538 t to 3 023 t.

Cash costs of A$1.99 /lb for the quarter were better than guided, albeit higher than the previous quarter of A$1.28/lb.

Sales revenue for the quarter was 29% lower than the previous quarter, primarily due to the divestment of the Tropicana operation at the end of May. Sales revenue from the Nova operation at A$189-million was lower than the previous quarter primarily due to lower nickel and copper concentrate sales volumes, as guided.

Net profit after tax (NPAT) for the quarter was A$46-million. The prior quarter NPAT of A$453-million included both results from the Tropicana operation as well as a post-tax gain on the sale of the operation of A$385-million.

IGO’s 24.99% attributable share of Greenbushes production for the quarter comprised 57 114 t of chemical-grade spodumene concentrate and 9 779 t of technical-grade spodumene concentrate. First lithium hydroxide was produced at the Kwinana refinery during the quarter, with commissioning continuing.

The Kwinana refinery comprises two trains each of which are expected to produce 24 000 t/y of battery grade lithium hydroxide when at full production. Train I is fully constructed and in commissioning. Train II is partially constructed, with construction planned to recommence in 2022.

Edited by Creamer Media Reporter

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