Investing.com — Pls Group (ASX:PLS) shares rose 3% on Friday after the Australian lithium producer approved a $1.3 billion expansion of its Pilgangoora operation in Western Australia, paving the way to nearly double its spodumene concentrate production capacity by 2029.
Shares gained 3.03% to A$3.06, outperforming the roughly 1% advance in the ASX 200 index.
The company approved a final investment decision for its P2000 project, which involves building a new Jimmagunya processing plant at its wholly owned Pilgangoora operation.
The expansion is expected to lift production capacity to 2 million tonnes per year, with first production targeted for the September quarter of 2029.
PLS estimates the project will require A$1.9 billion in capital expenditure, excluding separately approved infrastructure investments.
The cost is 46% higher than the inflation-adjusted estimate in its 2024 pre-feasibility study, although the completed feasibility study incorporates changes to the mining plan and processing design.
These estimates are based on a long-term spodumene concentrate price assumption of $1,620 per tonne.
PLS expects average annual production of 1.97 million tonnes over the first decade at steady state, with average unit operating costs of around A$620 per tonne.
Improvements to the mining plan will allow about 67 million tonnes of mineralised material previously classified as waste to be recovered economically as ore.
PLS said the expansion would be funded through its existing cash balance and operating cash flow, while leaving open the possibility of assessing debt funding as required.
Separately, the company outlined up to A$650 million in additional infrastructure investments at Pilgangoora. Its FY27 capital expenditure guidance was raised to A$1.11 billion to A$1.175 billion, with combined spending on P2000 and infrastructure expected to reach A$2.55 billion over FY27–FY29, peaking at A$1.3 billion in FY28.
Original Article
PLS Group shares rise 3% as it approves $1.3 billion lithium expansion
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