Orocobre says that lithium oversupply will not be an issue as it moves towards commercial production

By Adam Page
Published: Friday, 06 February 2015 on indmin.com

Orocobre is at the last stage of its qualifying process and it is hoping that within a few months it can begin commercial production and become a major global lithium supplier. It says that last year’s fears about lithium oversupply have not come to fruition because it is one of the few juniors to deliver results.

ASX and TSX-listed Orocobre Ltd. has said that it will be able to be a profitable player in the lithium market, dismissing fears expressed by established companies that newcomers like itself will saturate the market.

James Calaway, Orocobre’s North American chairman, told IM that, "we have a fairly robust growth in demand across the world."

"There is a little bit of expansion going on in China but as for the rest of the world, there is really no material increase," Calaway added.

Calaway says that when lithium prices were being negotiated for 2014 there was an impression amongst end-users that the lithium market would be oversupplied. He said that this led to customers "feeling muscular" when in negotiations but Calaway feels this has changed now.

"End users are more concerned with securing supply rather than price," Calaway explained.

Companies like Sociedad Química y Minera de Chile (SQM) has said it is worried about new suppliers disrupting lithium prices and saturating the market.

"What we see is a stable situation in the sense of volumes and in the side of SQM we see a strong market growing," Patricio Contesse, CEO of SQM, said during a conference call for its Q3 2014 results.

"[There have been announcements] of newcomers this year that have not been successful given they are in the equivalent of the Chapter 11 in Canada," Contesse added, referring to RB Energy, which halted all operations at its Quebec lithium project at the beginning of October 2014 and temporarily dismissed staff after it failed to secure the funding required to maintain operations.

$39m in new investment

Yesterday, Orocobre announced that it has raised approximately A$50m ($39m*) through an A$40m placement to domestic and international investors and a $10m underwritten share purchase plan.

Orocobre outlined that A$28m of the proceeds will fund the operations of its Olaroz lithium plant in Argentina, which was ramped up to commercial production within the last week.

"We are very pleased with the result of the raising in what are difficult conditions for resource companies," said Richard Seville, Orocobre’s managing director.

"We are now well funded to take Olaroz and the company through to the next stage of development, becoming a profitable operating company," Seville added.

Approximately 15.7m shares will be issued pursuant to Orocobre’s 15% capacity on the ASX, at a price of A$2.55/share. This is still subject to shareholder approval, which will be assessed at a general meeting in March.

The company is also announcing a share purchase plan which will be capped at A$15m, of which $10m will be underwritten. Shareholders will be invited to invest up to $15,000 each.

"Although we welcome some new shareholders onto the register, we are honoured by the ongoing support we have received from our existing shareholders in this raising. We will continue to work hard to build on the shareholder value that we have delivered to date," Seville said.

Olaroz plant

Orocobre says that its Olaroz plant has approximately 20,000 tonnes of lithium carbonate equivalent (LCE) in the pond system. It also claims the lithium inventory is growing at around 2,100 tpm LCE, according to current well pump rates.

"The majority of our material will be going to Japan, Korea and the US," James Calaway, Orocobre’s North American chairman, told IM.

"We will not only be supplying end users but also large producers, who are needing more supply," Calaway added.

Lithium demand is forecast to rise thanks to growing acceptance of electric vehicles (EVs), consumer electronics and energy storage.

In November 2014, Olaroz started producing primary lithium carbonate. Since then, the focus has been on commissioning the purification and drying/micronising circuits.

Since April 2011, Olaroz’s pilot plant has been distributing lithium carbonate to customers which Orocobre say will make the approval process a maximum of three to six months.

Toyota Tsusho Corporation, the company’s project partner, has finalised several customer contracts for 2015 output and it expects that the remainder will be completed during the first half of 2015.

Orocobre is now considering whether to increase the life of Olaroz with its phase II expansion. It is also looking into developing its other lithium assets in Argentina.

*Conversion made February 2015

Simbol Materials cuts jobs and halts activity at demo lithium plant

By Adam Page
Published: Thursday, 05 February 2015 on indmin.com

Simbol says that it is now seeking investors to help it commercialise its lithium production. However, EnergySource, the provider of its brines, says that it will take a different management team to realise the potential of Simbol’s lithium extraction process.

US-based Simbol Materials LLC has ceased activity at its Hudson Ranch geothermal lithium carbonate plant in Calipatria, California, US, and made 40 of its workers redundant.

Simbol said that operations have been inactive since December 2014.

"We completed the engineering studies and we are now in the mode of collecting investment infrastructures," Simbol’s CFO, Pete Sunada told IM.

"We thought we did not need to spend any more money on the operation at this point in time," Sunada said, adding, "nobody would start an investment discussion once the engineering is completed. It goes in parallel so it is ongoing," Sunada explained.

However, according to EnergySource, a renewable energy company that has provided Simbol with the geothermal brine used to test its lithium-extraction process, Simbol ran out of funds for the operations.

"We understand that last week, Simbol terminated senior management and most of the staff," Dave Watson, EnergySources CEO, told IM.

"Remaining Simbol employees are currently in the process of shuttering the demonstration facility they operate adjacent to our John Featherstone geothermal plant," Watson added.

Amongst those made redundant was David Edwards, Simbol's director of manufacturing. He follows Simbol’s CEO John Burba, who resigned last week.

Watson said that while EnergySource was disappointed with the latest news from Simbol, he said it was not surprised.

He told IM that previous management had failed to effectively implement the strategies necessary to achieve lithium extraction at the Hudson Ranch project, despite using "proven" technologies.

"We remain hopeful that new ownership and management sees the potential of the Simbol technology and we stand ready to support a new effort that demonstrates good prospects for success," Watson said.

Simbol’s plans

Last month, Simbol said that it would start construction on its first commercial lithium extraction plant at Salton Sea in California’s Imperial Valley, according to local newspaper The Desert Sun.

It said it wanted to produce 16,000 tpa lithium carbonate equivalent (LCE) from its 50MW power plant.

Simbol has already demonstrated its geothermal method at the plant, which will extract lithium, manganese and zinc to be transformed into materials suitable for batteries by using by-products from the plant, such as CO₂, waste water and condensate. According to Simbol, this is less dependent on weather conditions than the solar evaporation technique used by the majority of lithium brine producers.

"We believe Simbol’s technology is viable and proven at the demonstration facility," Watson told IM.

Watson suggested that new ownership would be the best option for company to realise its commercial objectives.

"We would expect a new ownership team to pursue a purchase of Simbol and its assets, as well as a transaction with EnergySource," Watson added.

In 2011, Simbol began operating its high-purity lithium carbonate demo plant and has already provided manufacturers with lithium carbonate and hydroxide to be tested in the cathodes of lithium-ion (Li-ion) batteries.

Towards the end of 2013, the company succeeded in producing lithium carbonate with a purity in excess of 99.9% using geothermal brine at its demonstration plant located near the Salton Sea.

The brine Simbol will be using is rich in sodium chloride, meaning it can avoiding buying in soda ash as a feedstock ingredient. It says that because the plant is close to sea-level and to port means that it doesn’t have to ship brines to a secondary processing facility.

The company is seeking to supply the electric vehicles (EV), energy storage applications and electronic goods markets that are after Li-ion batteries. It is anticipating a massive growth in demand from the Asian market.

In 2010, Japanese trading house Itochu Corp. acquired a minority stake in Simbol securing the sole rights to market Simbol’s future products in Asia.

Lithium-ion batteries looking to store the green revolution, not just to drive it

By Adam Page
Published: Wednesday, 24 December 2014 on indmin.com

California is following Hawaii’s lead in using lithium-ion phosphate batteries to storage its energy. The Golden State is aiming to install 1.3GW of storage by 2040 and CODA Energy is taking the first steps with this.

US-based CODA Energy’s behind-the-meter lithium-ion phosphate energy storage system in the Los Angeles basin is now interconnected and operational. The 1,054kWh/510kW system is comprised of electric vehicle (EV) battery cell packs.

"CODA Energy set high goals for this year. We now have proven solutions that cover the full spectrum of our commercial and industrial customers’ needs for peak power and energy," said Peter Nortman, CODA Energy’s COO and CTO.

The project was developed under a contract with South Coast Air Quality Management District (AQMD) and co-funded by California’s Self-Generation Incentive Program (SGIP). The project hopes to demonstrate the scalability of CODA Energy’s peak shaving product architecture by managing demand charges for its facility headquarters in Monrovia, California.

Light up the sky: CODA Energy will be powering the Los Angeles basin with an energy storage system powered by Li-ion phosphate batteries.

"Our behind-the-meter active and interconnected storage systems range from a 40kWh UL listed energy storage appliance to this 1,054 kWh scaled and tailored aggregation solution," he added.

The system is comprised of two networked and aggregated multi-tower systems that can operate in concert or deliver independent services. CODA hopes its scalable hardware and proprietary networking software gives its system configuration ample flexibility and the potential to operate across a local or regional level.

New storage market

At this year’s Battery Show in Michigan, speakers underlined the importance of diversifying the use of lithium-ion (Li-ion) batteries, like those being used by CODA. Enersys’ president, Dave Shaffer, insisted that battery producers must be geographically and technically adaptable to preserve the future sustainability of the market.

John Gagge, vice president for reserve power sales and service at EnerSys Americas, highlighted the growing energy demands of major cities and emphasised that there was a major opportunity for energy storage providers.

Archan Padmanabhan, stationary energy storage specialist for EV maker Tesla Motors Inc., spoke of the company’s drive to develop stationary energy solutions that will allow Tesla to meet its target of enabling widespread, sustainable transportation.

"It’s not just important to have EVs on the road, but to have them charged by cleaner sources of energy," said Parbmanabhan.

French battery maker Saft is currently developing a Li-ion energy storage system for the Hawaiian island of Kauai to regulate its electricity supply from renewable sources. The rest of Hawaii is seeking to transform its energy distribution system by 2017.

At the Battery Show, Kamen Nechev, chief technology officer at Saft, said that while performance advantages and storage ability remain key determinants of battery demand it will ultimately be costs that define whether the technology is viable.

The high cost of R&D and the varying demands of the technically multifaceted industrial sector are major obstacles that need to be overcome for projects to be workable. As a result, new sources of raw material are likely to be needed to prevent price inflation as demand from the battery sector grows.