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Australia’s IGO on Monday said ramp up of first production train at Kwinana lithium hydroxide refinery faced technical challenges after a planned shutdown in June quarter, even as it reported a significant jump in operating earnings.
Kwinana train 1, entirely owned by a joint venture between IGO and China’s Tianqi Lithium, produced 142 tonnes of lithium hydroxide in the June quarter, down over 85% sequentially.
“Production at Train 1 was lower than expected due to ongoing technical challenges which delayed the startup of the plant after the scheduled shutdown in May,” the Perth-based miner said.
Production from Kwinana train 1, currently at 20% of nameplate capacity, is now expected to reach about 50% by the end of this year.
Shares of IGO were trading 5.5% lower at A$13.690 as of 0448 GMT, their lowest level since May 3.
IGO reported record quarterly operating earnings of A$636.2 million ($424.6 million), up 19% sequentially, taking the full-year operating earnings to A$2.00 billion, up over 178% from last year.
An outlook-beating annual spodumene concentrate output from its Greenbushes operation, along with an uptick in nickel output, boosted IGO’s operating earnings for the year.
Spodumene concentrate output at Greenbushes rose to 395 thousand tonnes (kt) from 356 kt in the previous quarter, taking the annual output to 1,491 kt, and surpassing the top end of IGO’s outlook range of 1,350 kt and 1,450 kt.
Earlier this month, IGO flagged a writedown of between A$880 million and A$980 million ($600.42 million-$668.65 million) for fiscal 2023 due to ballooning capital costs at its nickel operations.
Prior to the writedown, net profit after tax (NPAT) for the June quarter was about A$525 million, the battery minerals producer said.
($1 = 1.4984 Australian dollars)
(By Echha Jain; Editing by Kim Coghill, Subhranshu Sahu and Varun H K)
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