Piedmont Lithium Completes Definitive Feasibility Study of Tennessee Lithium Project
April 20 2023 - 6:50AM
Business Wire
Study demonstrates robust project economics,
positive impacts of the Inflation Reduction Act
- Feasibility indicates results of NPV8 of $2.5 billion and
post-tax IRR of 32% for the 30-year project
- Average annual steady state EBITDA and after-tax cash flow
increase to $376 and $317 million, respectively
- Project economics demonstrate positive impact of America’s
pro-EV policies
- Innovative Metso:Outotec technology to provide improved
sustainability profile over conventional conversion
- Development-ready site with infrastructure, workforce, customer
proximity, and cooperative government
- Zoned for industrial use, reducing number of permits and
approvals required to commence construction
- Availability of low-cost, clean, reliable energy with TVA’s
net-zero by 2050 aspiration
- Permitting and project financing activities advancing with goal
of commencing construction in 2024
Piedmont Lithium Inc. (“Piedmont” or the “Company”)
(Nasdaq:PLL; ASX:PLL), a leading global developer of lithium
resources, is pleased to report the results of a Definitive
Feasibility Study (“DFS” or “Study”) of the Company’s proposed
Tennessee Lithium project in McMinn County, Tennessee. The Study of
the 30,000 metric ton per year (“tpy”) lithium hydroxide ("LiOH")
plant featuring the innovative and waste-reducing Metso:Outotec
conversion technology affirms the potential for Piedmont to develop
an American-based lithium hydroxide business using spodumene
concentrate from market sources, including via existing offtake
agreements with Sayona Quebec and Atlantic Lithium.
Study economics for Tennessee Lithium are shown in Table 1 below
and are highlighted by an estimated after-tax NPV (8% discount
rate) of $2.5 billion and an after-tax IRR of 32%. The Study
assumes fixed prices of $26,000 per metric ton of lithium hydroxide
and $1,600 per metric ton of spodumene concentrate over the
project’s 30-year life. The model includes a Section 45X production
tax credit of 10% under the Inflation Reduction Act of 2022 and
assumes a credit of $141.7 million against project capital costs
based on expected receipt of a U.S. Department of Energy (“DOE”)
grant. Tennessee Lithium development remains subject to, among
other things, receipt of material permits and arrangement of
project financing.
Table 1: Project Summary
Outcomes
Unit
Tennessee Lithium DFS (March
2023)
Operation life
years
30
Steady state annual LiOH production
tpy
30,000
Total initial capital cost
$mm
$809
After-tax Net Present Value @ 8% discount
rate
$mm
$2,492
After-tax Internal Rate of Return
%
32%
Steady state LiOH conversion all-in
sustaining costs
$/t
$2,952
Steady state spodumene purchase costs
$/t LiOH
$10,721
Average annual steady state EBITDA
$mm/y
$376
Average annual steady state after-tax cash
flow
$mm/y
$317
Payback from start of operations
years
2.8
Piedmont President and Chief Executive Officer Keith Phillips,
said he was pleased with the project economics and the positive
impact of the Inflation Reduction Act, which strongly favors
domestic battery and critical minerals production. “America’s
pro-EV and battery manufacturing policies are providing an
advantage to Piedmont at a time when many analysts are projecting
lithium shortages to continue into the 2030s. Piedmont’s selection
for a $141.7 million grant last year by the U.S. Department of
Energy exemplifies America’s commitment to developing a domestic
lithium supply chain.1”
“Tennessee Lithium is positioned to be a key resource for EV and
battery manufacturers,” Phillips added. “Through long-term supply
agreements with our partners, we can source raw material from
spodumene that we own or in which we have an economic interest,
providing greater control of our feedstock while capturing the
economics of integrated production. We can advance development of
the operation with revenues anticipated from the restart of North
American Lithium and our recent offtake agreements with Tesla and
LG Chem. Further, with the Metso:Outotec flowsheet, we believe we
can sustainably produce critical lithium materials on a
cost-effective basis for a more responsible profile compared to
producers utilizing sulfuric acid roasting.”
Piedmont is advancing permitting and project financing
activities for Tennessee Lithium with the goal of beginning
construction in 2024. The Company is focused on first commercial
shipments in Q3 from North American Lithium with revenue generation
to support activities across Piedmont's global portfolio of
projects, including Tennessee Lithium. A DFS is expected mid-2023
for the Ewoyaa Lithium Project in Ghana, which is expected to be
the primary feedstock for Tennessee Lithium, while Carolina Lithium
continues to advance through permitting and approvals
processes.
To view the full release and definitive feasibility study, click
here.
About Piedmont Lithium
Piedmont Lithium (Nasdaq:PLL; ASX:PLL) is developing a
world-class, multi-asset, integrated lithium business focused on
enabling the transition to a net zero world and the creation of a
clean energy economy in North America. Our goal is to become one of
the largest lithium hydroxide producers in North America by
processing spodumene concentrate produced from assets where we hold
an economic interest. Our projects include our Carolina Lithium and
Tennessee Lithium projects in the United States and partnerships in
Quebec with Sayona Mining (ASX:SYA) and in Ghana with Atlantic
Lithium (AIM:ALL; ASX:A11). These geographically diversified
operations will enable us to play a pivotal role in supporting
America’s move toward energy independence and the electrification
of transportation and energy storage. For more information, follow
us on Twitter @PiedmontLithium and visit
www.piedmontlithium.com.
1 The grant will not be final until Piedmont Lithium and the DOE
have agreed to specific terms and conditions of the grant. Once
terms and conditions are finalized, funding of the grant will
remain subject to satisfaction of conditions set forth in those
terms.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230420005314/en/
Erin Sanders SVP, Corporate Communications & Investor
Relations T: +1 704 575 2549 E: esanders@piedmontlithium.com
Christian Healy/Jeff Siegel Media Inquiries E:
Christian@dlpr.com E: Jeff@dlpr.com
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