An lithium mining project in Western Australia has secured public financing in a new $550 million loan to get it through early production, expected to start later this year.
Liontown Resources’ Kathleen Valley Lithium Project’s new loan agreement includes $230 million from federal agencies, which join the Commonwealth Bank and National Australia Bank in the syndicate.
The Clean Energy Finance Corporation (CEFC) has committed $110 million and Export Finance Australia (EFA) another $120 million.
Located north of Kalgoorlie, the Kathleen Valley Lithium mine will begin producing spodumene concentrate around the middle of the year.
It could eventually scale up production to up to 500 kt, making it one of the country’s biggest mines and supplying the likes of Tesla and Ford with battery inputs.
Owner Liontown Resources had been under pressure after the lithium price plunge and other lenders withdrew a $760 million loan for the project offered just months earlier.
The new, half government funded, loan gives the company certainty it can get to and through early production.
“Nine out of the ten critical minerals necessary for lithium batteries can be found here in Australia, which gives us a massive jobs and economic opportunity in the net zero transformation,” Climate Change and Energy Chris Bowen said.
“Few countries have as much to gain from the world’s shift to electric vehicles and the huge lift in battery storage as Australia. Making lithium a major export earner puts Australia in the value chain of the world’s automotive and renewable energy industries.”
According to the government, which has put a strong emphasis on projects that move Australia up resource value chains, the mining company is aiming to create “a pathway to downstream processing” and the mining project will be powered by at least 60 per cent renewable energy.
“To meet our net zero targets we will need more mining to build the solar panels, batteries and wind farms we need to reduce emissions,” Resources minister Madeleine King said.
“Projects like this show how the Government is supporting the resources industry to power our state, the nation and the region.”
The CEFC has also backed the world’s largest hard-rock lithium operation, providing owner Pilbara Minerals with a $50 million loan that was repaid early last year.
