Galaxy Resources reduces lithium mining by 60%

Matthew Farmer 23 January 2020 (Last Updated January 23rd, 2020 15:50)

Mining company Galaxy Resources has released its Q4 2019 results, showing plans to reduce lithium mining by 60% in 2020.

Galaxy Resources reduces lithium mining by 60%
In 2017, Australia was the world’s leading producer of lithium. Photo by Steve Morfi on Shutterstock.

Mining company Galaxy Resources has released its Q4 2019 results, showing plans to reduce lithium mining by 60% in 2020.

The company’s active facility is Mount Cattlin spodumene mine in Western Australia. It is also constructing Sal de Vida, an Argentinian brine-to-lithium facility, and James Bay, a hard rock lithium mine.

Mount Cattlin produced 1.79m wet tonnes of ore in 2019, refined into 191,569 dry tonnes of lithium concentrate. Of this, 43,222 was produced in Q4 2019, near the top end of estimates.

However, Galaxy says it paused mining at the site in December and mining operations will be scaled back by 60% throughout 2020.

Drilling, blasting, crushing and processing will resume in February, with mining resuming in March. The Q1 2020 forecast is 14,000-20,000 dry metric tonnes (dmt).

The company said in its report: “As previously advised, Galaxy is reducing mining and production rates at Mt Cattlin in 2020 to conserve mineral resources until market conditions improve.”

Despite the pause in mining, production for the year was 191,569 dmt, near the top end of estimates.

The average cost of production was $391 per dmt of concentrate, which Galaxy Resources said in a press release would reinforce Mt Cattlin as one of the lowest-cost lithium concentrate operations globally.

The company has a stockpile of contaminated ore which it plans to process.

Meanwhile, the Argentinian Sal de Vida facility is under construction in three stages. It says it will be “able to substantially fund Sal de Vida stage 1 internally”.

Evaporation ponds covering 15 ha are being built, with the plant expected to be commissioned in Q1 2020.

In Quebec, Canada, work is being done throughout Q1 2020 to minimise costs for the future operation of the James Bay plant.

At the time of their report, the company said it had a stockpile of 65,000 dmt and was debt-free, having repaid its loan to Alita Resources. Financial assets totalled $143.2m.