Pilbara Minerals has defied critics and is moving to expand its Pilgangoora mine in a bid to double its production at the Pilbara mine. The estimated cost of expansion currently sits at around $231 million, with CEO Ken Brinsden looking at various options to raise the capital for the expansion.
One of the main options for funding includes pre-payments for future lithium deliveries from Pilgangoora, which will be Australia’s second largest lithium mine by the end of 2018.
“It is a customer-led financing,” Mr Brinsden said.
He also said that most banks chose not to lend money to the lithium sector, especially during the exploration and development stage.
“It is the case that banks are starting to take more interest in the lithium story, but they tend to take more interest once you are in production,” he said,
“As banks get more and more comfortable with the sector those things will change in time.
“We are on a journey where the banks need more experience with the industry before they are ready to back it like they would a gold mine.”
“Against a backdrop of significant demand growth for lithium raw materials over the coming decade, the quality and scale of the resource at our Pilgangoora project demands further expansion.
“This will ensure it becomes a mainstay in the next generation of large-scale, low-cost mines to support the significant growth in downstream lithium hydroxide capacity.”