Galan Lithium says it has set the evaporation process in motion at its Hombre Muerto West lithium brine project in Argentina, with the earthworks and lining of its first pond officially complete.
The company is targeting first-phase lithium chloride production at the operation in the first half of next year and it says launching its evaporation phase ticks off a significant infrastructure milestone on its way to production.
Filling of the remainder of the first pond is underway, while earthworks construction of a second pond is 65 per cent finished. The liner installation is scheduled for next week.
Importantly, nine of the production wells at the project have been constructed, with only six required for phase-one production. A total of 23 wells are needed for peak production.
Management says the project also has several tenements, including its Catalina site, with potential to increase the quantity and quality of the brine resources, which may result in additional production.
Galan Lithium managing director Juan Pablo Vargas de la Vega said: “The completion of earthworks and the installation of liners for Pond 1 represents a significant milestone for the HMW Phase 1 construction team. Evaporation has now commenced which is the first step of the Company’s long-term production schedule for its low-cost, low-risk lithium chloride development strategy, as Galan looks to become the next lithium producer in Argentina in H1 2025.”
Proposed production at the project has been separated into four specific phases, starting with 5400 tonnes per annum of lithium carbonate equivalent (LCE) next year. Phase-two production is targeting 21,000 tonnes a year in 2026, before a significant increase during the third phase to 40,000 tonnes per year by 2028.
The final stage is predicted to produce 60,000 tonnes per annum using lithium brine sourced from both Hombre Muerto West and Galan’s other Argentinian brine project in Candelas.
Recent testing from the Hombre Muerto West pilot plant achieved the production of a lithium chloride concentrate product, equivalent to 13 per cent lithium oxide or 32 per cent LCE, with low levels of impurities.
Refinements to Galan’s production flowsheet in its recent phase two definitive feasibility study (DFS) have reduced its average annual operating cost from US$3963 (AU$6056) per tonne LCE to US$3510 (AU$5364). Management says the figure is comparable to a spodumene producer producing a 6 per cent spodumene product at between US$310 (AU$473) and US$350 (AU$535) per tonne for solid production margins, even at today’s current spot prices.
Last year, Galan signed a binding offtake agreement with mining giant Glencore, which outlined the supply of up to 100 per cent of lithium products from phase-one production at Hombre Muerto West. To sweeten the deal, Glencore offered to provide a secured financing prepayment facility for US$70 million (AU$107 million) and up to US$100 million (AU$154 million), subject to conditions.
The agreement is for a five-year period from the start of the first phase of commercial production, with Glencore continuing to carry out the due diligence outlined in the arrangement.
Galan is clearly making impressive progress with its Hombre Muerto West project and looks to be well on its way to joining the ranks of established lithium producers in the region as early as next year.
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By Michael Philipps
