PLS expands Pilgangoora lithium mine in Western Australia as EV demand supports long-term output growth

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PLS expands Pilgangoora lithium mine

Highlights

PLS Group commits A$1.9 billion to expand Pilgangoora mine, targeting 2 million tonnes yearly spodumene output and operational completion in 2029.
Despite firm EV-driven demand, spodumene prices have dropped from U.S.$3,000 to U.S.$1,505 per tonne since May as returning mines add supply.
The Western Australia Government expects the expansion to generate 1,000 construction and 500 ongoing jobs, supporting regional economic growth and record lithium industry output.

Pilgangoora expansion targets higher output by 2029

As reported by ABC News Australia, citing a statement to the Australian Stock Exchange, PLS Group is proceeding with a A$1.9 billion expansion of its Pilgangoora lithium mine, about 140 kilometres south-east of Port Hedland, to raise spodumene concentrate production to about 2 million tonnes a year. The project includes a new processing facility called Jimmagunya, a name given by Nyamal elders meaning spring country.

PLS managing director and chief executive Dale Henderson says the company is investing to keep the operation competitive in the lithium market and to support the asset's long-term potential. He says the planned changes are expected to lower operating costs, improve productivity and provide the infrastructure needed for the increased scale of the P2000 project.

The company also announces a A$600 million infrastructure program over three years, including access road upgrades co-funded by the state government, a new permanent 1,200-bed workers' village and a mine services facility. PLS says funding is supported by its existing cash balance and operating cash flow from current production.

If completed as forecast, the expansion is expected to make Pilgangoora a rival to Talison Lithium's Greenbushes operation in Western Australia as Australia's largest hard rock lithium mine. PLS expects the site to reach 2 million tonnes a year of spodumene concentrate when fully operational in 2029.

Price weakness contrasts with strong demand outlook

Market conditions remain mixed for lithium producers. While demand linked to electric vehicles stays firm, spodumene prices have fallen sharply since May, with prices dropping from U.S.$3,000 a tonne to U.S.$1,505 a tonne, while lithium carbonate is at about U.S.$15,500 a tonne.

Mining analyst Peter Strachan says lithium demand continues to grow but increased supply is weighing on prices. He says mines shut two or three years ago when prices fell are now returning to production, adding supply to the market and weakening sentiment toward Australian lithium miners.

Strachan says Talison Lithium, which owns the Greenbushes mine, is likely to focus on lower-cost operations in response to the Pilgangoora expansion. PLS says lithium has been a strong growth market over the past decade and cites forecasts for annual growth of 8% through 2040.

Western Australia highlights jobs and regional benefits

The Western Australia government welcomes the project, saying it will create 1,000 construction jobs and another 500 ongoing operational roles. Premier Roger Cook says the investment supports current employment and future job creation across the state.

Pilbara minister Amber-Jade Sanderson says the expansion is a vote of confidence in the region and will create opportunities for local workers, businesses and communities. The announcement also adds to momentum in the state's lithium industry, which sold almost 4 million tonnes of spodumene concentrate in 2025, the highest volume on record.

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