Investing in Lithium: Overview of the World’s Largest ‘Hard Rock’ Lithium Asset, the Greenbushes, Western Australia | Geology for Investors (2024)

Overview

Investing in Lithium: Overview of the World’s Largest ‘Hard Rock’ Lithium Asset, the Greenbushes, Western Australia | Geology for Investors (1)

The Greenbushes lithium deposit is located in the southwest of Western Australia, approximately 250 km south of Perth, and 90 km southeast of the Bunbury port (Figure 1). The operation is owned by Talison Lithium, a joint venture between Tianqi Lithium Corporation (SZSE:002466) and the Albemarle Corporation (NYSE:ALB). Open pit mining is conducted by conventional drill and blast methods, with gravity and magnetic ore separation, followed by flotation. Historical mining in the Greenbushes area, initially for tin, was first undertaken in the late 1800s. The mine has been in operation for over 25 years and has an estimated life of mine of 40 years (Figure 2). The Greenbushes deposit has the highest grade lithium mineral resource in the world at 3.9% Li2O, compared to 1.0-2.0% Li2O normally documented for other hard rock deposits. Lithium ore in the form of the mineral spodumene (LiAl(SiO3)2) is mined from unweathered zones of the pegmatite. Other products include tin and tantalite concentrate. According to the most recent ore resources available, proven and probable mineral reserves of 86.4 Mt at 2.35% Li2O are estimated for the Greenbushes lithium operation. The mine is evaluated to contain approximately 4Mt of lithium carbonate-equivalent (LCE).

Investing in Lithium: Overview of the World’s Largest ‘Hard Rock’ Lithium Asset, the Greenbushes, Western Australia | Geology for Investors (2)

Regional Geology

The Greenbushes deposit is located in a 15-20 km wide north to northwest trending regional lineament (the Donnybrook-Bridgetown shear zone) in the Balingup Metamorphic Belt. Limited exposure of the Balingup Metamorphic Belt reflects its extensive overprint by Tertiary (66-2 million years ago) sediments and laterite (an iron-rich, highly weathered soil formed in tropical and subtropical regions with humid climates). The Greenbushes pegmatites, estimated to be 2,525 million years old, show similar fabric as the shear zone they are hosted in, which suggests their synchronous emplacement with regional deformation. These intrusions were later affected by deformation and hydrothermal alteration at ~1100 million years ago.

Deposit Geology

The Greenbushes orebody comprises zoned pegmatite intrusions that are 3 km long and up to 300 m wide, and dip approximately 45° to the west. The pegmatites occur as a series of linear dikes intruded along a north to northwest trending shear zone (Figure 3). The main country rocks in the Greenbushes deposit include (i) amphibolite to ultramafic schist, (ii) ‘granofels’ (i.e. metasedimentary rocks and quartz-feldspar-biotite gneisses), and (iii) late dolerite dikes. Two major intrusive events recorded in the Greenbushes district include an older event that predates the mineralization, and a younger one that is coeval with the Greenbushes pegmatites. The last magmatic event was followed by amphibolite facies metamorphism.

Investing in Lithium: Overview of the World’s Largest ‘Hard Rock’ Lithium Asset, the Greenbushes, Western Australia | Geology for Investors (3)

The Greenbushes pegmatites reveal a distinctive mineralogical zonation. This zoning is characterized by lithium, potassium (K)-feldspar, and albite zones, which are shown in Figure 3 as Li zone, Ki zone, and Na zone, respectively. This mineralogical zonation is considered to be at odds with other similar deposits because the lithium zone, presumably the last zone to crystallize, occurs both in the hanging wall and footwall of local faults, as opposed to occurring in the center of the pegmatite. No significant mineralization is associated with the K-feldspar zone, which is rare in other pegmatites. The albite zone is characterized by tantalum and niobium contents that generally occur as niobium-tantalite minerals. Lithium mineralization is mainly characterized by spodumene (LiAl(SiO3)2) containing up to 8% Li2O. Minor lithium-bearing minerals include mica (lepidolite) and phosphates (amblygonite and lithiophilite). High-grade lithium ore typically comprises equal amounts of quartz and spodumene with 4% Li2O grade (Figure 4).

Investing in Lithium: Overview of the World’s Largest ‘Hard Rock’ Lithium Asset, the Greenbushes, Western Australia | Geology for Investors (4)

Discussion

A recent rise in the global demand for lithium-ion batteries, largely due to the electric vehicle boom, has ignited the search for lithium sources around the world (Figure 5). The most significant sources of lithium include brines and pegmatites (aka hard rock deposits).

Brine deposits, the most common type of lithium deposits, are characterized by accumulations of saline groundwater that are enriched in dissolved lithium. The 3,000 km2 Salar de Atacama in Chile is the world’s largest lithium brine mine (6.4 Mt at 0.14% Li2O), which is operated by the SQM – Sociedad Quimica y Minera de Chile S.A. (NYSE:SQM). This type of deposit has recently gained more interest due to the lithium rush driven by Tesla’s (NASDAQ:TSLA) lithium-ion battery gigafactory in Nevada. The only active operation producing lithium from brine deposits in the US is the Albemarle Corporation’s (NYSE:ALB) Silver Peak lithium mine, in Nevada.

The Greenbushes operation produces two types of lithium concentrates: (i) technical-grade lithium concentrate with low iron content used to manufacture glass, ceramics, and heat-proof cookware, and (ii) high yielding chemical-grade lithium concentrate, used to produce lithium-ion batteries for computers, mobile phones, and electric cars.

Investing in Lithium: Overview of the World’s Largest ‘Hard Rock’ Lithium Asset, the Greenbushes, Western Australia | Geology for Investors (5)

Implications for Hard Rock Lithium Exploration Worldwide

The age of the pegmatite intrusion may provide a first-order filter when exploring for similar lithium-bearing sources in underexplored regions. New deposits are likely to exist near fertile granitic intrusions, which can be identified by distinctive mineralogy, e.g. muscovite, tourmaline, and garnet, and by an anomalous concentration of caesium, lithium, rubidium, tin, and tantalum. Soil anomalies are expected in weathered deposits, like the Greenbushes. Whole-rock geochemistry can be used to establish pegmatite zonation, alteration patterns and stratigraphy. Because lithium content cannot be directly determined by pXRF (portable X-ray fluorescence), a proxy for lithium grades can be effectively acquired by the detection of pathfinder elements, e.g. rubidium, niobium, yttrium, caesium, tin, tantalum, tungsten, and boron. Therefore, pXRF can be used to identify fertile intrusions with high caesium, rubidium, tantalum, and tin, in tandem with low potassium/rubidium ratios.

Investor Takeaways

Despite accounting for only ~25% of lithium production worldwide, pegmatite-hosted ‘hard rock’ lithium deposits seem more advantageous than brine deposits. The major drawbacks related to brine deposits include overall lower grades, wide compositional range, ambiguous recovery rate and longer time frame required to implement and/or enlarge existing facilities. Regardless of their relative abundance and generally lower cost of production, brines found within closed basins in arid regions can only form in certain places. Thus, they are more dependent on climate conditions and geographic location. Additionally, ore from brine deposits also requires longer processing periods. On the other hand, hard rock lithium deposits show higher grades and are more evenly distributed, making them an excellent opportunity to promote a country’s source of lithium.

Further Reading

Partington, G.A., 1988. The geochronology, tectonic environment and structural controls on intrusion of the giant rare-metal pegmatite at Greenbushes, Western Australia. Unpublished PhD thesis, Perth, University of Western Australia, 120 p.

List of Companies Mentioned

– Talison Lithium Pty Ltd (website)

– Sociedad Quimica y Minera de Chile S.A., or SQM (website)

– Tesla (website)

– Albemarle (website)

Investing in Lithium: Overview of the World’s Largest ‘Hard Rock’ Lithium Asset, the Greenbushes, Western Australia | Geology for Investors (2024)

FAQs

What is the largest hard rock lithium deposit in the world? ›

Greenbushes mine is an open-pit lithium mining operation located south of the town of Greenbushes, Western Australia. It is the world's largest hard-rock lithium mine, producing approximately 1.95 million tonnes (4.3 billion pounds) of lithium spodumene annually.

Who owns the lithium mine in Western Australia? ›

The Mount Cattlin mine, owned by Allkem, a subsidiary of Arcadium Lithium (NYSE:ALTM), is located near Ravensthorpe in the Great Southern region of Western Australia. The asset produced about 131,000 tonnes of spodumene concentrate in its 2023 fiscal year.

How big is the Greenbushes lithium mine? ›

The Greenbushes pegmatite deposit intrudes along a major northwest regional fault zone. It is approximately 2,525 million years old. The pegmatite consists of a large main zone over 3 kms long and up to 300m wide with numerous smaller pegmatite dykes and pods flanking the main body.

Who owns the largest lithium deposits in the world? ›

Lithium reserves by country

Chile has the largest lithium reserves worldwide by a large margin. Australia comes in second, with reserves estimated at 6.2 million metric tons in 2023. Mineral reserves are defined as those minerals that were extractable or producible at the time of estimate.

Where does Tesla get its lithium? ›

At the end of 2021, Tesla inked a lithium supply deal with top lithium producer Ganfeng Lithium (OTC Pink:GNENF,SZSE:002460). Under the agreement, the Chinese company began providing products to Tesla for three years starting in 2022.

What country is richest in lithium? ›

Where in the world are the best lithium reserves? Chile has the largest lithium reserves, and the three countries that make up the Lithium Triangle — Argentina, Bolivia and Chile — together account for more than 63 percent of the world's lithium reserves.

Who owns Greenbushes lithium? ›

Greenbushes is 100% owned by Talison Lithium Australia Pty Ltd.

Who is the leader in lithium mining? ›

Australia, the world's leading producer, extracts lithium directly from hard-rock mines, specifically the mineral spodumene.

Does the US own any lithium mines? ›

While the US holds some of the largest known reserves of lithium, the only large-scale US mine producing it (located in Silver Peak, Nevada) makes less than 5,000 tons annually, which is less than 2% of the global supply. Bessemer City mine and Kings Mountain Mine in North Carolina have lithium deposits.

Who has the largest proven reserves of lithium in the world? ›

Bolivia, Chile and Argentina (the “lithium triangle”) have the largest estimated resources, with nearly 50 million tonnes of lithium between the three countries.

How profitable is lithium mining? ›

As reported by Fortune Business Insights, the global lithium market achieved a valuation of $37.8 billion in 2022. Projections indicate a substantial growth trajectory, with the market expected to reach $89.9 billion by 2030, reflecting a notable CAGR of 22.1% from 2023 to 2030.

What new battery will replace lithium? ›

In sodium-ion batteries, sodium directly replaces lithium. Not unlike lithium-ion batteries, sodium batteries contain four main components – the anode, the cathode, an electrolyte and a separator. The state of the electrolyte varies depending on the manufacturer.

Who makes Tesla batteries? ›

Tesla relies heavily on Panasonic for much of its battery manufacturing and car batteries, although it's tried to reduce that reliance of late. Other electric car manufacturers are also making inroads.

Is lithium mining worse than fossil fuels? ›

The carbon dioxide and other greenhouse emissions that come with the process of lithium mining, extraction and overall production are worse for the climate than the production of fossil fuel-powered vehicles.

Who has the largest reserves of lithium in the world? ›

Chile has the largest reserves of lithium worldwide, accounting for over one-third of the total reserves as of 2023. This was followed by Australia, with a 22.4 percent share of global lithium reserves that year. Meanwhile, the United States accounted only for about four percent of the world's reserves of lithium.

Where are the US largest lithium deposits? ›

The Thacker Pass lithium mine is a lithium clay mining development project in Humboldt County, Nevada, which is the largest known lithium deposit in the US and one of the largest in the world. There has been significant exploration of Thacker Pass since 2007.

What is the largest hard rock mine in the world? ›

Pilbara Minerals operates the Pilgangoora mine in Western Australia; it is the industry benchmark. This operation is expanding to be the world's largest hard rock lithium mine.

Where is the biggest hard rock in the world? ›

Located at Universal Studios Orlando in the CityWalk entertainment complex, Hard Rock Cafe Orlando is the biggest HRC in the world. With large, statuesque pillars, it stands majestically as a Roman Coliseum of rock, and boasts more pieces of music memorabilia than any other location.

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