Ioneer Ltd has dramatically expanded its lithium-boron Ore Reserves at Rhyolite Ridge, reinforcing the project’s robust economics and securing $16 million in new funding to advance development.
- Ore Reserves increased 308% to 247 million tonnes with a 95-year mine life
- After-tax NPV of US$1.367 billion and IRR of 14.5% reaffirm project strength
- US$16 million placement supports strategic partnering process led by Goldman Sachs
- Testwork breakthrough boosts lithium and boric acid production efficiency by up to 14%
- Permitting advances amid ongoing litigation and strong community engagement
Ore Reserve Expansion and Project Economics
Ioneer Ltd has announced a remarkable 308% increase in Ore Reserves for its flagship Rhyolite Ridge Lithium-Boron Project in Nevada, now totalling 247 million tonnes. This expansion translates into a mine life of 95 years, positioning Rhyolite Ridge as the world’s largest lithium-boron reserve. The company’s Managing Director, Bernard Rowe, highlighted the unique flexibility of the project’s mineralogy, allowing it to prioritize boron production during periods of low lithium prices, thereby optimizing revenue streams.
The updated project economics remain compelling, with an after-tax net present value (NPV) of US$1.367 billion and an internal rate of return (IRR) of 14.5%. Operating costs are competitive, with an all-in sustaining cash cost of US$5,745 per tonne of lithium carbonate equivalent, placing Rhyolite Ridge in the lower quartile globally for lithium production costs.
Capital Raise and Strategic Partnering
To accelerate development, Ioneer successfully raised US$16 million through a placement, attracting strong support from new and existing investors. This funding will underpin the ongoing strategic partnering process, with Goldman Sachs engaged as financial advisor. The process aims to secure a strong equity partner to help bring the project to a final investment decision (FID), expected after a minimum four-month period.
Operational Advances and Cost Efficiencies
In a significant technical breakthrough announced earlier in the quarter, Ioneer reported improvements in sulphuric acid and reagent efficiency testwork. These advances could increase lithium carbonate and boric acid production by 7-14% per tonne of acid consumed, while reducing leach cycle times by approximately 30%. This efficiency gain is poised to lower operating costs further, although these benefits are not yet reflected in the current economic model.
Permitting and Community Engagement
Permitting progress continues with the Bureau of Land Management’s approval of the Plan of Operations and ongoing modifications to state permits. However, litigation initiated by environmental groups remains a potential hurdle. Meanwhile, Ioneer has strengthened community ties through a binding development agreement with Esmeralda County, Nevada, promising infrastructure upgrades and local economic benefits estimated between $5-7 million during construction.
Market Context and Outlook
The lithium market backdrop is dynamic, with electric vehicle sales surging globally and lithium demand forecasted to grow at nearly 10% annually over the next decade. Despite current lithium prices below production costs, market analysts expect a supply deficit by the early 2030s. Boric acid markets show regional supply imbalances, notably in China, which could benefit Rhyolite Ridge’s boron co-product revenue. Ioneer’s diversified product mix and cost efficiencies position it well to navigate these market fluctuations.
Bottom Line?
With its expanded reserves, strategic funding, and technical advances, Ioneer is poised to solidify Rhyolite Ridge’s role in the global lithium-boron supply chain; though permitting and market volatility remain watchpoints.
Questions in the middle?
- Who will emerge as Ioneer’s strategic equity partner and on what terms?
- How will ongoing litigation impact the project’s permitting timeline and costs?
- When will the cost savings from testwork breakthroughs be fully integrated into project economics?