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Charging Rhyolite Ridge

ne of the lithium sector’s quiet achiev- “The way we see this playing out is we’ll of receiving the final permits for its air and
Oers shot to prominence last month with have permitting in place and then we will water pollution control requirements by
an $80 million capital raising that now has it make a FID, but of course there can be a mid-year. Both are subject to a 30-day pub-
firmly on track to break ground in the US by lag between permits and FID and that’s be- lic comment period.
the end of the year. cause you’re putting debt and all kinds of With sentiment returning to the lithium
Nevada-focused ioneer Ltd initially went other things in place that are all subject to sector and US-based projects receiving ex-
to the market for $60 million to pave the the permitting,” Rowe said. tra attention on the back of the new Biden
way for the start of construction at its Rhyo- “What we’re doing so we don’t have any administration’s strong pledges towards
lite Ridge lithium-boron project. However, lag time is allocating some of that money electrifying the country, ioneer is ramping
strong demand from existing shareholders we raised to what we’re calling pre-FID up its negotiations for offtake on the one
and new investors saw the company upsize construction works. And it’s all discretion- aspect of its production it has previously
the fully underwritten placement – corner- ary because it won’t be spent until we have held back on.
stoned by European ESG-focused institu- the permits.” Most of the company’s proposed boron
tion BNP Paribas Energy Transition Fund According to the DFS ioneer released production over the first five years of opera-
– to $80 million. almost 12 months ago, $US785 million is tions at Rhyolite Ridge is committed under
“We decided it was prudent to upsize it a needed to develop a 2.5 mtpa mining and binding offtake, but no deals have been
little bit to make sure we had sufficient fund- processing operation at Rhyolite Ridge struck on the lithium side as yet.
ing in place, but without scaling everyone which would produce 20,600 tpa lithium “We deliberately went slow on the lithium
back to the point that it became less at- carbonate and 22,000 tpa battery-grade offtake for various reasons, but one of the
tractive,” ioneer managing director Bernard lithium hydroxide from the fourth year on- fundamental reasons was that last year we
Rowe told Paydirt. wards. were in a very different pricing environment
“At the end of the day $20 million more Rowe said while the $80 million raised on lithium and we actually saw very, very
raised is $20 million off the capex of the last month was a relatively small amount in few offtakes,” Rowe said. “If you take out
project because the bulk of what we raised the grand scheme of project development, spodumene offtakes, which are in a differ-
here, regardless of whether it was $60 mil- it demonstrated that both company and its ent sort of basket, I don’t think there was
lion or $80 million, will come straight off investors were serious about building the any offtakes done for lithium chemicals last
the capex with respect to the detailed en- operation which has an estimated lowest- year, certainly not any that were disclosed
gineering and pre-FID construction works quartile AISC of $US2,510/t. to the public.
that we’re doing. “When you’re coming out and saying “We’ve seen a dramatic change in the
“You can look at this as being the first this money is to be used to actually build last 5-6 months since the Tesla battery day
step towards raising the capital to build the the project, that sends a very strong signal in September where suddenly there’s rising
entire project.” that you’re serious and you’re getting to that prices for lithium chemicals that has seen
Rowe said the company had committed pointy end of the process where you’re ac- a marked change in the level of interest
about $33 million to advancing detailed en- tually going to go out and break ground,” he around offtake.”
gineering on certain aspects of the project, said. Rowe said the company was also locked
including civils and earthworks, to a 100% From a permitting perspective, the fed- in “very advanced discussions” with poten-
completion level so the path is clear for the eral record of decision which ultimately tial strategic partners and hinted an agree-
proposed start of construction in Q4 2021. clears the path for construction remains on ment could be reached before the end of
Overall engineering is expected to be track for Q4 2021. The company was also this quarter.
about 60% complete at that stage, with the expecting to receive its notice of intent – the “Our idea is for a strategic partner to be
balance mostly attributed to longer-lead next step in the permitting process post ap- the centrepiece of the funding solution for
items such as the final plant design. proval of its draft plan of operation and EIS the project,” Rowe said. “We see a large
A further $28-33 million will also be al- – at the time of print. part of the capex coming from a strategic
located to pre-FID construction works, Once that notice is issued, ioneer will be partner who will buy a minority stake in the
although the company insists it will not be able to start the public consultation process project.”
touching those funds until the final permits which, if successful, culminates in the re- – Michael Washbourne
currently being reviewed by state and fed- cord of decision.
eral authorities are in place. At a state level the company is confident

After raising $80 million last month, ioneer is on track to break ground at its
Rhyolite Ridge lithium-boron project in Nevada before the end of 2021

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