Name of the Project
Pilgangoora lithium/tantalum project.

Location
Western Australia.

Client
Pilbara Minerals.

Project Description
Pilbara has endorsed the definitive feasibility study (DFS) for the base case two-million-tonne-a-year development of the Pilgangoora project.

The DFS has been based on the project’s updated ore reserve of 69.8-million tonnes grading 1.26% lithium superoxide (LiO₂ or spodumene), 132 parts per million tantalum pentoxide (Ta₂O₅) and 1.04% iron oxide.

The DFS proposes a mining method based on conventional openpit mining, and has been evaluated for truck and hydraulic excavator (backhoe) operations using 4 m  2.5 m flitches for 10 m benches for combination pegmatite mining, and 10 m bench mining for waste mining.

The concentrator plant has been designed to process two-million tonnes a year of ore feed. The nominal capacity of the concentrator has been estimated at 270 t/h.

The flowsheet has been designed to process two-million tonnes a year of ore feed – chemical grade spodumene at 6% LiO₂ and medium iron; and tantalite concentrate at 30% Ta₂O₅ prefinal dressing.

The concentrator comprises crushing; feed preparation; dense-media separation; gravity separation; grinding, flotation, magnetic separation and dewatering. Wet magnetic separation has been included in the flotation process to reduce iron in the chemical and the future technical grade product.

The project will have a life-of-mine of 36 years.

As a result of the significant increase in the Pilgangoora resource and reserve base, Pilbara has also completed a prefeasibility study (PFS) to assess the potential doubling of production from two-million tonnes a year to four-million tonnes a year from Year 3 as an expansion option.

Jobs to be Created
Not stated.

Net Present Value/Internal Rate of Return
The project has a post-tax net present value (NPV), at a 10% discount rate, of A$709-million and an internal rate of return (IRR) of 38.1%, with a payback of 2.72 years.

The proposed expansion project has an NPV of A$1.17-billion and an IRR of 46.3%, with a payback of 3.05 years.

Value
Initial capital costs are estimated A$213.9-million.

The incremental capital cost estimate to achieve a four-million-tonne-a-year plant and infrastructure capacity at the Pilgangoora site, including all direct and indirect costs, is estimated at more than A$128-million at a PFS level of assessment.

Duration
Construction is expected to start in the fourth quarter of this year and commissioning from late 2017.

Latest Developments
Pilbara Minerals has awarded the engineering, procurement and construction (EPC) contract for its processing plant to RCR Tomlinson.

The contract for the two-million-tonne-a-year lithium/tantalum plant contains a target cost of A$138-million, with a guaranteed maximum price of A$148-million.

The EPC contract has been awarded in two stages, with the initial Stage 1 being a two-month front-end engineering and design programme, which will determine the final scope of work, timeline and target price.

Pilbara will commit a fixed A$10.3-million to the Stage 1 contract.

The miner has said that once project funding has been secured, a final investment decision has been made and Stage 1 has been satisfactorily completed, Pilbara will have the option to commit to the Stage 2 construction, which will be for the balance of the contract price and planned to start in May 2017.

In addition to the EPC contract, Pilbara has also awarded the first-stage contract for a 300-room camp relocation package and the re-establishment works to OTOC Australia.

Key Contracts and Suppliers
RCR Tomlinson (EPC) and OTOC Australia (300-room camp relocation package and the re-establishment works).

On Budget and on Time?
The Pilgangoora lithium project is on track for commissioning in 2017.

Contact Details for Project Information
Pilbara Minerals, tel +61 8 9336 6267 or fax +61 8 9433 5121.