South America is famous for its “Lithium Triangle”, but it is Western Australia’s (WA’s) “Lithium Corridor” that is really the major global supplier of the key electric vehicle (EV) battery metal.
Already the world’s leading lithium producing region, WA is set to play an even more significant role with the giant Australian state being the current focus of a lithium “gold rush”.
With lithium demand and prices continuing to skyrocket, exploration activities targeting new discoveries in WA are at an unprecedented level. So much so, that several gold mining and base metal specialists are now turning their attention to the hunt for the critical battery metal.
New WA lithium exploration campaigns and results are announced daily, with numerous explorers unveiling new lithium focused programmes or announcing they are re-assaying previous drill cores to ascertain whether lithium is included in historic precious metals-focused results.
On a corporate level, there has also been a noticeable number of new lithium-focused companies opening shop in the WA capital of Perth. One of the newest entrants into the WA lithium exploration field is Oar Resources (ASX: OAR), led by Chris Gale.
Oar announced in early November that it had signed a Binding Option Term Sheet for the 100% acquisition of a lithium project near Wiluna in Western Australia.
The project is targeting pegmatite hosted lithium mineralization, with initial indications pointing to the existence of lithium-caesium-tantalum (LCT) pegmatites. This type of pegmatite is the same host rock found at several key lithium projects including Pilbara Minerals’ (ASX: PLS) Pilgangoora project and Talison’s Greenbushes operation.
Covering a combined area of 217.7km2 across one granted tenement and two tenement applications, the project lies 120km north-west of Liontown Resources’ Kathleen Valley lithium deposit, which holds a current Mineral Resource Estimate of 156Mt at 1.4% Li2O and 130ppm Ta2O5.1
Recently completed reconnaissance by Oar has confirmed the presence of pegmatites at the location of the historic rock chip samples. Sixteen samples were collected by the company’s geological team at the site of the historic samples and at numerous outcropping pegmatite dykes up to 500m from the initial anomalism.
Executive Chairman Chris Gale said Oar is developing into a battery metals-focused company and the new WA asset is a key part of that strategy, adding to its existing graphite project in South Australia.
“We see this project as a valuable addition to our stable of critical mineral assets that are in demand globally as the race for renewables continues to accelerate,” Mr Gale said.
“WA lithium assets are an attractive proposition because as well as offering potential high grades and large volumes, we’re in good company given the extent of current exploration, development and production occurring in the state.
“As a lithium mining location, WA offers established infrastructure capable of supporting more growth, while the world’s most experienced and knowledgeable hard rock lithium experts are based here.
“It adds up to a well-known, trusted jurisdiction that is well regarded by investors and global lithium markets so that bodes well for Oar Resources as we plan to imminently progress exploration activities.”
St George success
Well known WA nickel explorer, St George Mining Limited (ASX: SGQ), is just one of the local companies that have recently made a significant commitment to lithium exploration. In early November, the company announced drilling success at its Mt Alexander Project in WA’s Goldfields, including early indications that the maiden drill programme has intersected lithium-bearing pegmatites below surface.
“Exploration is in full swing at Mt Alexander, and we are delighted with the positive results being delivered by our team in the field,” said executive chairman, John Prineas.
“Exciting news is starting to emerge from our first-ever lithium drill programme at the Jailbreak Prospect which – though still at an early stage – has already confirmed the near-surface continuity of lithium-bearing pegmatites.
“The latest assays for rock chip samples have delivered our highest-grade lithium values at Jailbreak, providing further validation of the potential for pegmatite-hosted lithium mineralization at Mt Alexander. Significantly, the high-grade assays now extend across five pegmatites mapped across a broad area.”
Government backing lithium play
WA’s mines and petroleum minister, Bill Johnston, says the state’s government is fully supportive of the hunt for lithium.
“The search for battery minerals is fundamental to the world’s clean energy transition; the McGowan government will continue to grow and diversify our resources sector to meet the growing demand for renewables.
“WA’s mineral exploration companies continue to lead the nation with the record $2.5B invested over the past financial year representing 64% of the Australian total.”
Key facts
According to the WA government’s website, the state is the largest lithium supplier in the world, accounting for 52% of global supply in 2021, followed by Chile (25%). It also noted the following:
- WA is about to become the world’s biggest producer of processed lithium
- WA accounted for 100% of Australia’s lithium production in 2021
- WA accounts for 24% of the world’s lithium reserves in 2021
- WA is about to become the world’s biggest producer of processed lithium
- WA’s hard rock is “cleaner” than the brine lithium being mined in some parts of the world
- WA has four operating lithium mines with eight new mines on the path to production
- Greenbushes is the state’s largest lithium mine, accounting for 58% (189Kt of LCE) of the State’s lithium production in 2021. Other major lithium mines include Mt Marion (21% or 69Kt of LCE), Pilgangoora (11% or 36Kt of LCE), and Mt Cattlin (9% or 29Kt of LCE)
Major downstream processing projects are also underway with three of the world’s largest lithium producers – China’s Tianqi Lithium, the USA’s Albemarle (NYSE: ALB), and Chile’s SQM (NYSE: SQM) partnering with Australian companies IGO Limited (ASX: IGO), Mineral Resources (ASX: MIN), and Wesfarmers (ASX: WES) to build and operate battery-grade lithium hydroxide facilities in WA.
Since the mid-2010s, WA has attracted more than A$9B of investment for a range of battery and critical mineral projects, including the establishment of globally significant mineral processing facilities.
Operated by some of the world’s top resources companies, these advanced processing facilities provide a strong foundation for more investment in the state’s battery and critical minerals value chain, including the manufacturing of cathode active materials. The state’s third lithium hydroxide plant is under construction at Kwinana, as part of the Mt Holland project that is due for completion in 2024. The plant will have the capacity to produce 50Ktpa of lithium hydroxide, the WA government said.
