Ioneer co-sponsors EV rally across US as work accelerates on Rhyolite Ridge lithium-boron project

Ioneer ASX INR EV rally Charge Across America Rhyolite Ridge lithium boron project
EV sales are predicted to exceed 25 million by 2028 as part of the shift to a carbon neutral world.

Aspiring lithium producer ioneer (ASX: INR) has co-sponsored a “first of its kind event” involving an electrical vehicle (EV) rally across the United States, as development of North America’s only lithium-boron deposit accelerates.

Called Charge Across America, the EV rally is a 10-day race featuring five teams driving from New York city to Los Angeles.

The event aims to demystify EVs and highlight advancements in the space.

ioneer managing director Bernard Rowe said the company viewed the global shift to EVs as central to the company’s lithium production strategy.

It is predicted EV sales will reach over 25 million by 2028.

Mounting lithium demand to feed EV boom

From its advanced Rhyolite Ridge lithium-boron project in Nevada, ioneer hopes to meet some of the region’s mounting lithium requirements.

The US currently has eight mega-factories in the pipeline to 2024, with three already operational.

Rhyolite Ridge is close to the operational Tesla’s Gigafactory 1, which produces 100GWh of cells, which are then used to power EVs.

Once all these mega-factories are online in 2024, Benchmark Minerals estimates they will be generating 125GWh of cells, which will require 107,000 tonnes per annum of lithium chemicals.

A director of Nevada Governor’s Office of Economic Development Michael Brown said the Charge Across America rally made a “major statement” to the public as well as policymakers and manufacturers – that EVs are “fully capable” of travelling coast to coast.

“To help fuel the EV boom on the horizon, the lithium supply-chain is being developed right here in our backyard,” he added.

Major lithium producer Albemarle’s Silver Peak operation in Nevada has annual output of lithium carbonate of 5,000t.

In comparison, at Rhyolite Ridge, ioneer plans to produce 20,600tpa of lithium carbonate, with this to be converted from year four to 20,000tpa of lithium hydroxide plus 174,400tpa of boric acid.

Advancing Rhyolite Ridge

Rhyolite Ridge is North America’s only known lithium-boron deposit. It is also the region’s most advanced lithium project.

Over the last 12 months, ioneer has rapidly progressed the project towards development and is fully funded to a final investment decision.

A definitive feasibility study was published at the end of April 2020 and gave a capital expenditure estimate of US$785 million.

All-in sustaining costs to generate the lithium hydroxide were forecast at U$2,510/t, which ioneer says will make it the lowest cost lithium producer globally.

The project is underpinned by a 146.5 million tonne lithium and boron resource and a 60Mt lithium and boron reserve.

It is expected initial mine life will be 26 years and will bring annual revenue of US$422 million and earnings before interest tax depreciation and amortisation of US$288 million.

ioneer is targeting first production from Rhyolite Ridge in the second half of 2024.

Sibanye-Stillwater provides crucial funding

Major investor and new partner Sibanye-Stillwater has thrown a financial lifeline to help ioneer breathe life into Rhyolite Ridge.

In mid-September, ioneer and Sibanye-Stillwater agreed to team up and jointly develop the project.

Sibanye-Stillwater is acquiring 50% of Rhyolite Ridge in return for US$490 million (A$668 million).

ioneer’s cash reserves have also been topped up after it completed a US$70 placement to Sibanye-Stillwater.

The placement proceeds will be used to progress long-lead items and fund medium term capital needs to minimise the time to production.

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