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Highlights
- Piedmont’s shares were trading at AU$0.84 each, down 5.62%, at 11.33 AM AEST on ASX on Friday.
- This underperforms ASX 200 Materials index which was 1.01% up at 15,298.70 points.
Shares of Piedmont Lithium Inc (ASX:PLL) were trading in the red on Friday (30 September) despite no major announcement made by the company. At 11.33 AM AEST, the lithium company's shares were trading at AU$0.84 apiece, down 5.62%, on ASX. This underperforms ASX 200 Materials index which was trading 1.01% higher at 15,298.70 points at 11.34 AM AEST. However, the ASX 200 index was 0.54% down at 6,519.90 points at 11.36 AM AEST.
Why is weighing on Piedmont shares?
The shares of Piedmont were trading lower in the early trade despite no price-sensitive news released by the company. While the overall materials sector was trading on a positive note, Piedmont's share price was under pressure.
Notably, the company disclosed in an ASX statement on Wednesday (28 September) that its partner Atlantic Lithium (ASX:A11) had finished the prefeasibility study (PFS) for Piedmont's Ghana Project, Atlantic Lithium’s flagship Ewoyaa project in Ghana's Cape Coast region.
The PFS showed that the Ghana Project's production target was 255,000 tonnes per year of 6% lithium spodumene concentrate produced over a 12.5-year mine life from 18.9 million tonnes of ore reserves containing 1.24% lithium dioxide.
More details
As part of the PFS, the project's estimated capital costs increased. However, Atlantic Lithium anticipates lower operational costs for the proposed manufacturing facility. The capital expenditure grew from US$70 million to US$125 million.
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Data Source- Company announcement dated 28 September 2022
In Ghana's spodumene projects run by Atlantic Lithium, Piedmont would receive a 50% interest. An offtake agreement for 50% of yearly production at market rates for the duration of the mine was also a part of this arrangement. Additionally, Piedmont holds a 9.4% equity stake in Atlantic Lithium.
