A look into Lithium Australia’s dynamic September 2019 Quarter

Perth-based Lithium Australia NL (ASX: LIT) engaged in the extraction, acquisition, recovery and development of lithium deposits, recently disclosed its Quarterly Activities Report for September 2019 as the company continues to aim for closing the loop on the energy-metal cycle in a sustainable way and envisions for enabling a circular battery economy.

Some of the Key Highlights from the company’s last quarter are discussed below.

RECYCLING

  • Deepening of Partnership with Envirostream Australia Pty Ltd

Lithium Australia increased its equity stake to 23.9% in Victoria-based Envirostream, which operates the only national facility to shred spent batteries including lithium-ion batteries (LIBs), followed by production of a mixed-metal dust (MMD) that is currently exported to South Korea for further refining.

Envirostream added an additional 50 collection points to its existing ones, supported by its partnerships with LG Chem and the Milwaukee Electric Tool Corporation, among others. The company’s processing capacity has been further supplemented by its partnership with LIT.

A plant upgrade to a design capacity of 1000 tpa, and critical items of equipment have been delivered, putting Envirostream in a strong support position concerning the national roll-out of a stewardship programme for batteries, as well as Victoria’s ban on consigning spent batteries to landfill.

  • Australian Nuclear Science and Technology Organisation (ANSTO)

In line with its research on chemical processing of both LIBs  and alkaline batteries, LIT is finalising a practical hydrometallurgical flow sheet for battery metals recovery, including lithium, from spent LIBs, (It is a major shot in the arm for the company, considering the fact that, at present most global recyclers are failing to do this). It is a part of LIT’s programme to treat recycled battery in Australia.

The next test work module has been assigned to ANSTO by LIT and pilot plant designing is ongoing which will cater to lithium phosphate (LP) recovery from spent LIBs, which would be directly fed into creation of cathode materials for lithium-ferro-phosphate (LFP) batteries (a type of LIB). Given there is enough market appetite, the LP can also be converted to lithium hydroxide.

  • VSPC Ltd

Brisbane, Australia-based VSPC (LIT’s 100%- owned nanotechnology subsidiary) owns a pilot plant and advanced laboratory & testing facilities, where it recently undertook cathode powder production for LFP coin-cell batteries where the LP recovered by LIT’s  proprietary technology from feed material supplied by Envirostream as informed in October 2019. These LFP coin-cell batteries surpassed in-house test standards upon electrochemical testing by VSPC.

The key goal of LIT, Envirostream and VSPC is to establish a cost-effective and renewable circular battery economy in Australia. The LIT/EA/VSPC Production Cycle (given below) presents as opportunity for improving efficiency and reduction in manufacturing costs in the battery industry. This would further help in abiding by the ethical, social and governance standards as expected by the community.

By minimising the environmental footprint of portable power and improving resource sustainability, these technologies could greatly enhance global efforts to deal with climate change as well.

LITHIUM CHEMICALS

LIT’s lithium extraction processes, in combination with proprietary VSPC nanotechnology, create battery cathode powders directly from LP, without the need for lithium hydroxide or carbonate production as an additional step in the process. The company has also lodged patent applications for its LP precipitation and refining process.

Moreover, LIT is also evaluating conversion of LP directly to lithium hydroxide, the global market for which is quite robust. The refining process involving impurities from LP is also being considered for patent applications.

Meanwhile, LIT is further advancing development of its proprietary LieNA® technology for thermal conversion of spodumene concentrates into lithium chemicals, for which a preliminary feasibility study is also being carried out.

BATTERIES

  • During the concerned quarter, as VSPC produced cathode materials, some international battery manufacturers in Japan, China and India are also examining samples of those materials.
  • In early 2019, LIT signed an agreement with DLG, a major Chinese battery manufacturer, to commercialise VSPC cathode powders in China and develop a battery distribution business across Australia, and the two parties subsequently incorporated a LIT/DLG vehicle, named Soluna Australia Pty Ltd, to nationally distribute energy management systems, including Soluna™ range of battery products manufactured by DLG.
    • LIT and GLG aim to commercialise VSPC cathode powders in China and if successful, VSPC will become DLG’s preferred supplier of cathode materials.

RAW MATERIALS

  • Exploration Activities for The Quarter

Lithium Australia currently prefers obtaining lithium minerals from mining waste streams or discharge from existing operating mines. But the company is also gauging other supply models such as Lithium micas, often associated with tungsten, tin, and tantalum as well as certain varieties of clay minerals.

  • Mr Mark Strizek, appointed as Manager – Raw Materials in July 2019.

Mr Strizek continues to rationalise LIT’s Australian tenement holdings, including its tenure in WA, the Northern Territory, Queensland and South Australia. A complete review of all historic and recent exploration activity has been completed and provided to interested parties.

  • The company also informed in September 2019 that its option over the Youanmi Lithium Project had expired while it continued to progress its PFS for the Sadisdorf Lithium Project, Germany to investigate the viability of producing cathode materials for LIBs from that location. In 2018 and 2019, LIT identified lithium pegmatite swarms at its Medcalf lithium prospect, Western Australia, a portion of its Lake Johnston project. Encouraged by the fieldwork, the company is considering to drill the area to further test this target and seeking approvals from the concerned authorities.

Stock Information : LIT’s market cap is ~AUD 17.63 million with ~ 534.27 million shares outstanding. On 22 November 2019, the LIT stock closed the day’s trade at AUD 0.034, up 3% as compared to its previous closing price.


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