Cleveland, Lincoln counties eyeballed for new lithium mine
If an alien dropped in from Mars in search of the best place for mining lithium, it would choose a strip of North Carolina in Cleveland and Lincoln counties, says Keith Phillips, who spent 30 years as a Wall Street investment banker specializing in natural resources companies. With no alien in sight, Phillips is leading development of a $450 million plan to mine and refine lithium on 1,260 acres that is owned or under option by Piedmont Lithium, a publicly traded startup that is raising money and has no current revenue.
“We believe North Carolina is the single best location in the world as a lithium-processing center,” says Phillips, the company’s CEO. Most lithium mines are in remote locations such as western Australia and central Africa. “Here, we have a world-class resource that is 30 miles west of Charlotte, while we will be building a chemical business [in Kings Mountain] in the heart of industrial America.”
It will be late 2019 before Piedmont makes the final decision on whether to go ahead with the $110 million mine, pending engineering and economic studies. A $340 million processing plant for lithium would follow after about two years of construction. The mine and plant could employ 300 to 400 employees.
Phillips compares the opportunity to a potential blockbuster new drug with financial, scientific and regulatory hurdles. “We’re moving at warp speed from the mining industry’s perspective,” he says. Securing environmental permits also will affect the project’s timing.
The mine’s appeal centers on the expected 15% to 20% annual growth in demand for lithium, an essential material for batteries used in the booming electric-vehicle market. The company’s business plan estimates annual after-tax cash flow of $170 million over the mine’s 13 years in operation.
Initially listed on the Australian Stock Exchange last year, Piedmont started trading on the Nasdaq exchange in April under the PLLL symbol. Shares have ranged from about $12 to $16, putting the company’s market cap at about $65 million in mid-June. Phillips says the company has enough money through this year and is not raising capital.
Charlotte-based Albemarle and Philadelphia-based FMC, both public companies, have processing plants in the same region and operated mines there for decades before closing them in the ’80s and ’90s as industrial demand for lithium faded. “There’s room for lots of people,” Phillips says. “If vehicles shift to electric as quickly as is expected, there will be great need for more lithium.”
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