MELBOURNE (Reuters) - Australian lithium miner Pilbara Minerals Ltd <PLS.AX> said on Tuesday a pre-feasibility study has supported its plan to more than double capacity at its Western Australian operations, pushing its shares up more than 10 percent.
Pilbara Minerals, which has strategic off-take and financing agreements with Chinese lithium producer Ganfeng Lithium and automaker Great Wall Motor Co <601633.SS>, said the expansion could be commissioned as soon as the fourth quarter of 2019.
First production from its Pilgangoora project, which will yield a type of lithium in mineral called spodumene, is due mid year. The expansion would boost processing capacity from 2 million tonnes a year at present to 5 million tonnes a year.
Lithium, used in batteries, is a key material for electric vehicles.
Pilbara Chief Executive Ken Brinsden said in a statement the expansion would leverage off the existing mine, making it "capable of meeting the long-term requirements of our customers."
A final investment decision on the expansion is due in the third quarter of this year and construction could start in the fourth quarter, the company said.
Pilbara Mineral's shares were up 8.5 percent at $0.86 in early afternoon trade, while the benchmark S&P/ASX 200 index <.AXJO> was up was up 0.5 percent.
(Reporting by Melanie Burton; editing by Richard Pullin)
