The Tianqi Lithium and IGO joint venture behind the underperforming Kwinana lithium refinery has poured further funds into the asset after awarding a $4 million contract.
The Tianqi Lithium and IGO joint venture behind the underperforming Kwinana lithium refinery has poured further funds into the asset after awarding a $4 million contract to a local engineering firm.
The JV – majority controlled by China’s Tianqi Lithium (51 per cent) alongside critical mineral miner IGO (49 per cent) – awarded the construction work to SIMPEC, a subsidiary of ASX-listed WestStar Industrial Limited.
The structural, mechanical, piping (SMP) contract adds to SIMPEC’s work at the refinery south of Perth, after it won an $11 million SMP and electrical and instrumentation package in August.
The Kwinana battery-grade lithium hydroxide refinery - Australia’s first - has long struggled with technical challenges during ramp-up, with nameplate capacity of 24,000 tonnes per annum far from being achieved. It produced 6,782 tonnes for the singular train in FY25.
It comes against the backdrop of the JV partners being increasingly at odds over the future of the ailing asset, with IGO taking a grim view and Tianqi bullish on its long-term future.
After IGO declared it had all but lost confidence in the refinery, TLEA responded by saying it was pushing ahead with planned capital works to further debottleneck the plant, which at last count was operating at 35 per cent of nameplate.
Tianqi Lithium’s chief executive Frank Ha then used a recent trip to Perth double down on his commitment to keeping the plant online and said he’d be open to acquiring IGO’s stake, although at the time discussions were not afoot.
IGO recently swung into the red with a $950 million loss after recognising a $605 million impairment against its 49 per cent stake in the refinery.
The critical minerals miner’s chief executive Ivan Vella said their focus at Kwinana was “making sure we’re not spending money that isn’t value add”.
On Monday, SIMPEC told the market TLEA awarded the $4 million contract to enhance capacity within the existing processing plant at Kwinana.
SIMPEC managing director Mark Dimasi said the contract to deliver the new system for the partners was a major milestone for SIMPEC.
“It strengthens our position as a trusted partner for complex industrial projects and reflects our growing role in Australia’s lithium and clean energy sector,” he said.
“We look forward to working with Tianqi Lithium Kwinana to deliver this important project safely, efficiently and to the highest standards.”
The contract will commence immediately and is tipped for completion in the fourth quarter of this calendar year.
Shares in WestStar Industrial last changed hands at 6 cents a pop, up almost 2 per cent at market close.
