After months of anticipation, Tawana Resources (ASX: TAW) has vaulted into lithium producer status after reporting lithium concentrate production had begun at its 50% owned Bald Hill lithium-tantalum mine in Western Australia’s eastern goldfields.
Ore has been fed into the dense media separation (DMS) circuit which will ramp up to its 1.2 million tonne per annum capacity during the next few months.
Tawana and its joint venture partner Singapore-listed Alliance Mineral Assets (SGX: 40F) claim they are the first operation to begin producing spodumene in Australia since 2016.
“It is a great effort by everybody involved to take Bald Hill from maiden lithium resource to production in nine months including only seven months of construction from the ground up,” Tawana managing director Mark Calderwood said of the company’s latest achievement.
“The focus now is to achieve steady state production from the stage one DMS circuit and optimise lithium yields,” he said.
Mr Calderwood added the joint venture was also finalising the design for the lithium fines circuit and working on recommissioning the tantalum processing operations.
Lithium offtake tied up
Tawana and Alliance secured separate offtake agreements in April last year with Burwill Holdings. Under the agreement, Burwill will purchase 6% spodumene concentrate for five years at a fixed price of US$880 per tonne (free on board from Esperance) for 2018 and 2019.
To secure its lithium concentrate, Burwill prepaid Tawana A$12.5 million, which Tawana used to contribute its share of capital development costs.
The first spodumene shipment is planned for next month.
Further potential at Bald Hill
Bald Hill has an indicated and inferred resource of 223,000t of contained lithium and 5.1 million pounds of tantalum.
Tawana claims this resource only makes up about 25% of the known pegmatites in the project’s southern tenements and the project is “significantly underexplored”.
In late December, extensional step out drilling at Bald Hill returned up to 4.27% lithium below the starter pit.
Bald Hill encompasses 774 square kilometres and comprises four mining leases, one mining application, 12 exploration licences, eight prospecting licences and a general purpose lease.
Shares in Tawana were unchanged at A$0.435 in early morning trade.