Metals

Galan slows construction pace at Argentina lithium brines project

CBCIE Time:Jul 15, 2024 14:28 Source:miningweekly

ASX-listed Galan Lithium has opted to recalibrate its construction schedule for the Hombre Muerto West (HMW) Phase 1 project, in Argentina, citing cash preservation amid current market conditions.

The decision postpones the expected start of production from the lithium brines project to the second half of next year.

Galan has received strong international market interest in the HMW lithium concentrate. “In our view, this evidence indicates that the current lithium pricing environment and market oversupply is not expected to be a long-term trend,” MD JP Vargas de la Vega said on Friday.

Lithium inventories continue to build in the HMW Phase 1 ponds, which would provide feedstock for the HMW processing plant. It currently has an in situ inventory of 2 800 t of lithium carbonate equivalent (LCE).

“Our inventory will continue to increase as we have a low energy cost operation that only requires brine pumps to operate. As a result, once Galan finalises sales and funding arrangements, which are progressing well, the company will be in a strong position to produce a competitive low-cost lithium product,” said De la Vega.

Overall completion of the HMW Phase 1 project now sits at about 40% with the ponds system at 60% capacity. The designed ponds system can allow an inventory, until the second half of 2025, of up to 10 000 t/y LCE without the need for processing.

About 750 000 m2 of evaporation area has now been built. The current evaporation area is sufficient to produce a lithium chloride volume of about 3 000 t/y LCE. The key processing parameters, including brine well average flow rates, lithium grades and evaporation rates are all aligned with Phase 1 of the definitive feasibility study (DFS). Owing to the slower pace of construction activities, first production from HMW is now expected to be within H2 2025.

The HMW project was separated into four production phases. The initial Phase 1 DFS focuses on the production of 5 400 t/y LCE of a lithium chloride concentrate.

The Phase 2 DFS targets 21 000 t/y LCE of a lithium chloride concentrate in 2026, followed by Phase 3 production of 40 000 t/y LCE by 2028 and finally a Phase 4 production target of 60 000 t/y LCE by 2030. Phase 4 will include lithium brine sourced from both HMW and Galan’s other 100%-owned project in Argentina, Candelas. 

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