Piedmont Lithium (ASX:NASDAQ:PLL, OTC:PLLTL) Inc, a leading North American supplier of lithium products critical to the U.S. electric vehicle supply chain, today reported its first quarter 2024 financial results.
Largest spodumene operation
The company’s project, North American Lithium, the largest producing spodumene operation in North America, achieved record quarterly production of 40,439 dry metric tons (dmt) of spodumene concentrate in the first quarter of the year.
NAL is jointly owned by Piedmont (25%) and Sayona Mining Limited (75%).
The operation exceeded plan with lithium recoveries of 69% in March 2024, setting a new monthly record.
Overall safety performance improved as NAL recorded its lowest quarterly incident rate since the restart of operations in March 2023.
Construction materially completed
Construction of the crushed ore storage dome at NAL was materially completed during the first quarter with commissioning advancing in the second quarter.
This capital project, along with other improvements, is expected to result in increased NAL production and a reduction in NAL’s unit operating costs.
NAL management estimates operations will achieve full run-rate production in the second half of the year.
In North Carolina, Piedmont achieved a significant milestone in May 2024 with the receipt of the mining permit for Carolina Lithium, a strategic project situated in the US battery belt.
The mining permit is a catalyst for accelerating discussions with potential funding parties, including government loan agencies and strategic partners who could provide capital, offtake and technical support.
Based on its published technical studies the company expects Carolina Lithium to be a low-cost producer of spodumene concentrate and lithium hydroxide and a key contributor to US energy security.
The project should benefit from exceptional infrastructure, minimal transport distances, low energy costs, a deep local talent pool and proximity to cathode and battery customers as well as by-product markets.
Competitive corporate tax regime
The competitive corporate tax regime offered in the US, the absence of significant royalties, and the benefits inherent in the Inflation Reduction Act of 2022 should also provide advantages to the project.
Piedmont plans full-year customer shipments of some 126,000 dry metric tons (dmt), weighted to the second half of 2024.
A mining permit for Carolina Lithium has been issued this month, which the company says will accelerate funding discussions.
PLL has enjoyed revenue of US$13.4 million on sales of around 15,500 dmt of spodumene concentrate.
The company has a cash position of US$71.4 million as of March 31, 2024, with working capital nearly doubled from the end of 2023.
The 2024 outlook for shipments is set to more than double and investments to decrease more than 50% in the second of year as compared to the first.
“We are very pleased with developments during the first quarter, including the milestones attained in Quebec and North Carolina.
“NAL achieved records in both safety performance and production in Q1, 2024, and the outlook is promising with the commissioning of the crushed ore dome currently underway.
A year of two halves
“2024 will be a year of two halves, with Piedmont shipments expected to more than double from H1, 2024 to H2, 2024 as we begin to emphasise shipments to core customers under long-term agreements, and Piedmont capital expenditures and investment in affiliates to fall by over 50% in H2, 2024 vs H1, 2024,” said PLL president and CEO Keith Phillips.
“Carolina Lithium is one of only two significant spodumene projects in the United States, and receipt of our mining permit is a critical step in its development.
“We will now focus our efforts on aggressively pursuing strategic partnering and other funding conversations for our foundational asset.
“We also fortified our balance sheet by monetising certain non-core investments during the quarter, and we are well-positioned to advance our projects with a continued focus on minimising dilution to Piedmont shareholders.”