Piedmont Lithium Inc. has released the findings of a Definitive Feasibility Study (DFS) for the proposed Tennessee Lithium Project in McMinn County, Tennessee.
Piedmont has the potential to establish an American-based lithium hydroxide (LiOH) business using spodumene concentrate from market sources, including Sayona Quebec and Atlantic Lithium‘s offtake agreements, according to the study of the 30,000 metric tonne per year (tpy) LiOH plant with the cutting-edge and waste-reducing Metso:Outotec conversion technology.
Tennessee Lithium Project DFS economics emphasises a projected after-tax NPV (8% discount rate) of US$2.5 billion and an after-tax IRR of 32%. Over the project’s 30-year life, the DFS assumes fixed prices of $26,000 per metric tonne of lithium hydroxide and $1,600 per metric tonne of spodumene concentrate. The model estimates a credit of US$141.7 million against project capital costs based on the projected receipt of a U.S. Department of Energy (DOE) grant under Section 45X of the Inflation Reduction Act of 2022. The Tennessee Lithium Project’s development is still contingent on receiving material permissions and arranging project funding, among other things.
Piedmont President and CEO Keith Phillips expressed satisfaction with the project’s economics as well as the positive impact of the Inflation Reduction Act, which significantly favours local battery and critical mineral production.
“America’s pro-EV and battery manufacturing policies are providing an advantage to Piedmont at a time when many analysts are projecting lithium shortages to continue into the 2030s. Piedmont’s selection for a $141.7 million grant last year by the U.S. Department of Energy exemplifies America’s commitment to developing a domestic lithium supply chain,” Phillips stated.
“Tennessee Lithium is positioned to be a key resource for EV and battery manufacturers,” Phillips added. “Through long-term supply agreements with our partners, we can source raw material from spodumene that we own or in which we have an economic interest, providing greater control of our feedstock while capturing the economics of integrated production. We can advance development of the operation with revenues anticipated from the restart of North American Lithium and our recent offtake agreements with Tesla and LG Chem. Further, with the Metso:Outotec flowsheet, we believe we can sustainably produce critical lithium materials on a cost-effective basis for a more responsible profile compared to producers utilizing sulfuric acid roasting,” he added.
Piedmont is progressing with permitting and project financing operations for the Tennessee Lithium Project, intending to start construction in 2024. The Company is focusing on the first commercial shipments from North American Lithium in Q3, with revenue generation to fund activities throughout Piedmont’s worldwide portfolio of projects, including Tennessee Lithium. A DFS for the Ewoyaa Lithium Project in Ghana, which is projected to be the principal feedstock for Tennessee Lithium, is due in mid-2023, while Carolina Lithium continues to progress through regulatory and approvals procedures.
