Liontown Resources’ board has agreed to proceed with the delivery of direct shipping ore (DSO) product to the Kathleen Valley lithium project.
It cited providing an early source of revenue ahead of the first concentrate production as the reason.
The company said that since mining operations commenced in January at the Kathleen’s Corner and Mt Mann open pits, it has stockpiled approximately 70,000 tonnes of DSO product while undertaking a financial evaluation, conducting ore sorting test work and engaging prospective offtake customers.
“Ore sorting test work has achieved positive results and prospective customers have been provided bulk samples for their own test work. Commercial discussions with potential customers are well advanced.,” Liontown said.
“Liontown expects to sell 250,000 to 300,000 tonnes of DSO material prior to first concentrate production. Sales of DSO product post first concentrate production are subject to a separate business decision and market conditions at the time.”
Recently, Liontown awarded the spodumene and DSO haulage services contract for the Kathleen Valley project to Qube Holdings in late July.
It has also executed a contract with Axis Mineral Services for the crushing, screening and sorting of the DSO material at Kathleen Valley, which is expected to commence in the December 2023 quarter (Q4 2023).
Liontown Resources chief executive officer Tony Ottaviano said that the company’s mining team has continued to optimise its mining plan.
“It illustrates the depth of our team and our commitment to realising the full potential of Kathleen Valley. As a lithium producer in a Tier-1 jurisdiction we bring a distinct and reliable benefit to customers,” Ottaviano said.
“Therefore, progressing with the production of DSO not only provides early revenue potential, but also enables us to de-risk the project by field testing our ore sorting and logistics solutions on a smaller scale ahead of first concentrate production mid-2024.”