NEWS RELEASE
Perth, Western Australia, March 2, 2011 – Talison Lithium Limited (“Talison” or the “Company”) (TSX:TLH) announces final approvals and details on the Stage 2 expansion of production capacity of the chemical-grade plant at the Greenbushes Lithium Operations (the “Expansion”).
Highlights
The Board has given final approvals for the Expansion and site works to commence in April 2011
Expansion will more than double total nameplate production capacity at the Greenbushes Lithium Operations to approximately 740,000 tonnes per annum lithium concentrate (approximately 110,000 tonnes per annum lithium carbonate equivalent (“LCE”))
Total capital costs of the Expansion are estimated at between A$65 to A$70 million
Commissioning of the Expansion is anticipated to commence in the second quarter of calendar 2012
Expansion ensures Talison is well positioned to increase sales and provide the lithium market with security of supply to meet expected future growth
Talison expects to release an updated reserve statement incorporating the improved operating economics from the Expansion by June 2011
Expansion of the Greenbushes Lithium Operations
The Stage 1 expansion at the Greenbushes Lithium Operations was completed in December 2010. Following completion of the Stage 1 expansion, total nameplate production capacity at the Greenbushes Lithium Operations has increased to approximately 315,000 tonnes per annum lithium concentrate (approximately 47,000 tonnes per annum LCE).
In December 2010, Talison announced that in response to continued strong demand for lithium concentrate the design of the Expansion was being revised to allow for further increases in production capacity above the original design.
The engineering design work to define the scope and capital cost of the revised Expansion has now been completed. The Expansion comprises a new, purpose built, large scale chemical-grade lithium concentrate production facility. The Expansion is expected to substantially reduce Talison’s unit operating costs through improved lithium recovery and economies of scale.
The Expansion will more than double the current total production capacity of the Greenbushes Lithium Operations, with total nameplate production capacity increasing to approximately 740,000 tonnes per annum lithium concentrate (approximately 110,000 tonnes per annum LCE).
Total capital costs of the Expansion are estimated at between A$65 to A$70 million and will be funded by current cash reserves which include the net proceeds of the recently completed equity financing. Key long lead time items for the Expansion, including ball mills have been ordered, and tenders for the majority of the necessary equipment have been issued.
Talison is in final negotiations with the preferred construction contractor and expects to enter into the construction contract for the Expansion and commence site works at the Greenbushes Lithium Operations during April 2011. Commissioning of the Expansion is anticipated to commence in the second quarter of calendar 2012.
Discussions with new and existing customers for sales contracts for the increased production from the Expansion are continuing. Global demand for lithium is expected to accelerate significantly in coming years driven by demand for lithium-ion batteries for use in mobile technology, energy grid stabilisation and electric vehicles, and the Expansion will enable Talison to provide its customers with the security of supply and confidence to continue to expand their own operations.
Peter Oliver, Chief Executive Officer said, "Talison has a history of increasing production capacity in response to world demand for lithium, and has previously completed several successful expansions. This Expansion is in-line with Talison’s strategy to leverage off the strengths of its large, high-grade lithium deposit at the Greenbushes Lithium Operations and its technical expertise in the production of lithium concentrate.”
“After completion of the Expansion, Talison’s production capacity will be broadly equivalent to the size of the total global lithium market in 2010. An expansion of this scale demonstrates Talison’s confidence in the outlook for the lithium market, and enables Talison to provide its customers with security of supply to meet the expected future growth in demand for lithium-ion batteries in the years ahead.”
Greenbushes Lithium Operations Reserve Statement
Talison has been undertaking in-fill drilling at the Greenbushes Lithium Operations, with the initial objectives of upgrading the lithium mineral resources and improving the conversion of lithium mineral resources to lithium mineral reserves. The in-fill drilling has now been completed and Talison expects to release an updated statement of lithium mineral reserves and mineral resources by June 2011. The updated statement of lithium mineral reserves and mineral resources will incorporate results from the in-fill drilling and the improved operating economics from the Expansion.
About Talison
Talison is a leading global producer of lithium. Talison mines and processes the lithium bearing mineral spodumene at the Greenbushes Lithium Operations in Western Australia. In addition, Talison explores for lithium at the Salares 7 lithium project made up of seven salars located in Region III, Chile. Talison has an extensive, well established global customer network and a leading position in the growing Chinese market.
For further information please contact:
Todd Hilditch
Investor Relations Director
Phone: 604 443 3831
Email: Todd.Hilditch@talisonlithium.com
Talison Lithium Limited
Level 4, 37 St Georges Terrace
Perth, Western Australia 6000
Web site: www.talisonlithium.com
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Cautionary Note Regarding Forward-Looking Statements
Certain information contained in this press release, including any information as to Talison’s strategy, projects, plans, prospects, future outlook, anticipated events or results or future financial or operating performance constitute “forward-looking statements” within the meaning of Canadian securities laws. All statements, other than statements of historical fact, are forward-looking statements. Forward-looking statements can often, but not always, be identified by the use of words such as “plans”, “expects”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, “predicts”, “potential”, “continue” or “believes”, or variations (including negative variations) of such words; or statements that certain actions, events or results “may”, “could”, “would”, “should”, “might”, “potential to”, or “will” be taken, occur or be achieved or other similar expressions concerning matters that are not historical facts.
Forward-looking statements are necessarily based on a number of factors, estimates and assumptions that, while considered reasonable by Talison, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Such factors, estimates and assumptions include, but are not limited to, those described in the unaudited interim consolidated financial statements of Talison and the related notes thereto as at December 31, 2010 and for the three and six month interim periods ended December 31, 2010 (the “Financial Statements”), and the Company’s annual information form for the year ended June 30, 2010 dated January 12, 2011 (the “Annual Information Form”), each of which can be found on Talison’s SEDAR profile at www.sedar.com. While the Company considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect and actual results may vary.
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Readers are cautioned that forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Talison and/or its subsidiaries to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks, uncertainties and factors are discussed in the Financial Statements and the Annual Information Form, each of which can be found on Talison’s SEDAR profile at www.sedar.com. Readers are cautioned that forward-looking statements are not guarantees of future performance. All of the forward-looking statements made or incorporated in this press release are qualified by these cautionary statements.
Although Talison has attempted to identify statements containing important factors that could cause actual actions, event or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Forward-looking information contained herein are made as of the date of this press release based on the opinions and estimates of management on the date statements containing such forward looking information are made. Except as required by law, Talison disclaims any obligation to update any forward-looking information, whether as a result of new information, estimates or opinions, future events or results or otherwise. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information.
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Notes on Talison Lithium:
Largest supplier of Lithium to China
China is now the largest lithium consumer globally
China = 1/3 of total world consumption
Total World Demand estimated 7% per yr through 2020
Insufficient domestic production to meet demand
Talison supplies the majority of China’s lithium
Talison’s key Chinese customers are rapidly expanding capacity to meet domestic demand
Extensive EV guidelines outlined by Chinese government to improve energy security, reduce reliance on oil imports and assist in reducing carbon dioxide emissions
China investing $25B for electric vehicles
5% of total car sales to be ‘new energy’ by 2011
Approximately 14m passenger cars sold in 2010
10 Cities reached, 1,000 new energy vehicles
U.S. offering $8,000 subsidy per passenger EV purchase
Only producer with both spodomen and brine properties
25 year production history
over 300 customers worldwide
sold 100% of production in 2010
increasing production in 2011 by 105%
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