• Pilbara Minerals shows lithium boom remains strong with new record at Battery Material Exchange auction
  • Firefinch emerges from near death experience with heavily discounted recap raising

By the law of things what goes up must come down, but we seem to be waiting a long time for that to happen when it comes to lithium prices after Pilbara Minerals (ASX:PLS) smashed another record with its latest spodumene auction.

The latest and ninth auction of spodumene concentrate on PLS’ Battery Material Exchange platform has pulled in an outrageous US$6988/t for 5000t of 5.5% Li20 concentrate.

That is a single shipment raking in more than $52 million Aussie, the sort of haul iron ore miners would dream of raking in on one cargo.

Adjusted for the 6% benchmark grade normally used by reporters of lithium spot prices, the pull is US$7708/dmt CIF China.

What the actual?

Need a reminder of how this story has developed since the Pilgangoora miner, which delivered a record $561.8m full year profit in FY22 has gone?

The first auction over a year ago, one of the biggest price discovery events in the young history of the battery lithium market, pulled in US$1250/t for a 5.5% Li2O cargo.

Check out the progress:

1st Auction, 2nd Auction, 3rd Auction, 4th Auction, 5th Auction, 6th Auction (bidding got so frenzied PLS accepted a bid before the sale had even taken place), 7th Auction, 8th Auction.

As our intrepid Dep Ed. Reubs said in our regular chat to simply gawk at the prices lithium converters are throwing on the table to feed the growing EV industry in China, “not even the most bullish of bulls would have predicted this a couple years ago”.

Pilbara Minerals was up 1% to a record $14.94 this morning, defying a tidal wave of negative sentiment engulfing the market, with ASX mining stocks down 2.27% with the broader ASX 200 facing a 1.43% sell off.

 

Pilbara Minerals (ASX:PLS) share price today:

 

 

 

Guess who’s back, back again

Malian gold miner Firefinch (ASX:FFX), which has been halted for several months in a bid to recapitalise after production fell short of expectations at its Morila gold mine is back with a $90 million recapitalisation package in tow.

The company has announced a plan to produce 180,000oz over the next 18 months at all in sustaining costs of US$1425-1475/oz, backed by a $90 million equity raising at a heavily discounted 6c a share.

FFX last traded at 20c, but was an emerging mid cap only a few months ago, part of the ASX 300 before the demerger of its stake in the Goulamina lithium mine into Leo Lithium (ASX:LLL) and troubles at Morila.

As part of the deal mining contractor MEIM Morila SARL will also convert US$23.4m of debt and future liabilities into equity subject to shareholder approval and trade creditors will convert at least US$4.89m into equity, giving FFX a proforma cash balance of $126m before costs.

A share purchase plan will also be launched to raise $10 million from existing shareholders, with a new board led by managing director Scott Lowe to try lead the goldie out of the mire.

“The agreement of the recapitalisation package, together with the alignment of key stakeholders, represents a significant milestone and provides a strong balance sheet to enable the Company to continue the Morila production ramp up under the Company’s Stage 1 and Stage 2 production plan through to 2024,” FFX non-executive chairman Brett Fraser said.

“Under Scott Lowe’s new leadership, the Company plans to complete its review of the Morila life of mine plan, to release an update to the Company’s ore reserve estimates based on the
August update to the Morila Deposit’s Mineral Resources and to continue to implement its revised mining, capital expenditure and operational plans to ensure that Morila’s operations are more cost-effective and efficient.

“We appreciate the strong support that each of MEIM, Morila’s other service providers and the Company’s new and existing institutional shareholders have given the Company in order to
implement the recapitalisation strategy.”

Morila produced 8122oz in August, a record under Firefinch’s ownership of the once major gold mine, but still below the 30,000oz per quarter run rate the company plans to hit from October.

A longer term ore reserve and mine plan is expected in the fourth quarter.

 

Firefinch (ASX:FFX) share price today: