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Pilbara Minerals (ASX:PLS) sells 15,000 tonnes of spodumene using lithium hydroxide tolling

ASX 200, ASX News, Materials
ASX:PLS      MCAP $12.33B
20 February 2023 16:23 (AEST)
Pilbara Minerals (ASX:PLS) - Managing Director, Dale Henderson

Source: Pilbara Minerals

Pilbara Minerals (PLS) has sold a 15,000-tonne cargo of spodumene concentrate to a chemical converter, marking the first sale of its kind using a new commercial model based on lithium hydroxide tolling.

The agreement is structured so Pilbara Minerals will receive the value of the lithium hydroxide price for the product sold minus an agreed amount for conversion and other costs.

This is the first time the company has used this pricing methodology, and Pilbara said it believed this could potentially be “highly favourable” to the company and opened the door for future tolling arrangements.

The sale was not made through PLS’ BMX auction platform, as Pilbara had instead received a strong offer from the chemical converter.

However, the company will continue to explore various avenues to sell its unallocated tonnes, including on the BMX platform, through spot sales, and via other commercial opportunities that it believes will maximise value creation.

The company said the price it would receive for the cargo would be calculated using future lithium hydroxide pricing at the time of conversion to lithium hydroxide.

The spodumene concentrate is expected to be delivered before the end of the March quarter.

PLS shares were down 4.73 per cent and trading at $4.23 just before market close.

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