Piedmont Lithium

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Piedmont Lithium
Nasdaq:  PLL

Piedmont Lithium is an American mining company in the process of proving economic mineral recovery of lithium at sites in North Carolina, Tennessee, Canada, and Ghana. [1] [2]

Contents

The company has done business deals with Tesla and is planning to invest in a $1.8 billion mine in Gaston County, North Carolina. [3]

The Gaston County project is one of multiple projects that Piedmont Lithium is working to develop currently. [4]

The surrounding Gaston County community is concerned that the mine will affect their water and air quality. [5]

Background

"The modern lithium-mining industry started in this North Carolina region in the 1950s, when the metal was used to make components for nuclear bombs. One of the world’s biggest lithium miners by production, Albemarle Corp, is based in nearby Charlotte. As of March 2021, nearly all of Albemarle's lithium is extracted in Australia and Chile, which have large, accessible deposits of the metal." [6] As of 2021, just one percent of global lithium supply is both mined and processed in the United States (3,150 t (6,940,000 lb)), while 233,550 t (514,890,000 lb) is produced in Australia and Chile. [6]

History

Piedmont Lithium Ltd was founded as an Australian company in 2016. Cofounders included Australian financier Taso Arima and US geologist Lamont Leatherman, who raised several million dollars of seed funding to start the firm. [6] Arima read about the prospecting work Leatherman had done in the Gaston County, South Carolina area. Leatherman had explored the area for lithium in surface rock in the late 2000s after thinking back to "the green-striped rocks in the yard of his childhood home in [the area]. The rocks contained rich veins of lithium." [6]

Projects

Piedmont Lithium currently has mining related projects in Quebec, Tennessee, Gaston County, and Quebec. [3]

Gaston County Carolina Lithium Project

The project in Gaston County is currently in development and will include a 1.2 billion dollar mine as well as processing plant. [3] The mining project is currently in a negotiation phase as Piedmont Lithium needs to obtain air and water permits as well as a rezoning approval from Gaston County in order to continue to develop the mine. [5] Piedmont Lithium's Gaston County project proposal predicts that “33,000 tons of lithium [will] be mined per year” and will produce “330,582 tons of greenhouse gas emissions annually”. [5] The proposal states that the project will produce “169 tons of particulate matter” and“ 69 tons of the [the particulate matter will be] PM 2.5,”. [5]

According to the proposal, the Gaston County project will operate on 3,600 acres of land which Piedmont will use “half [of the land] as a buffer, and the other half, [as a] mining operations proper”. [5] The company plans to have the Gaston County mining operation as both a mining site as well as spodumene processing plant, “one of the few of its kind in the United States”. [7] The mine is predicted to be in operation for 11 years and is expected to bring in large amounts of profit for the company according to Piedmont Lithium CEO Keith Phillips. [7]

The mine in Gaston County will be an open-pit Lithium Mine. [8] Open-pit mines create mining waste which includes, but is not limited to thousands of tons of sulfuric acid per day as well as radioactive uranium extracts. [9] Piedmont Lithium will implement multiple environmental risk mitigation features in their proposed mine. These features include a conveyor belt to transport blasted rock from the mine up to the processing plant and the usage of many tons of water to prevent dust from building up. [10]

On April 15, 2024, the company obtained the final permits they needed to build the Lithium Mine. The permits were approved “despite widespread opposition from neighbors worried about water, noise pollution and other potential problems”. [1] Currently Piedmont Lithium is waiting on rezoning approval from the Gaston County Board of commissioners to begin the project. [1]

Community Response

Gaston County

In Gaston County Piedmont Lithium began buying land in Gaston County, eventually accumulating 3,600 acres. [5] The company intends to use the land for their mining operation close to where their headquarters are located. [8] When the Piedmont Lithium mining project was proposed to the Gaston County community it was met with push back. The residents were concerned that the mine would have a significant impact on the Gaston County environment, specifically the air quality and municipal water quality. [10]

In 2018 Piedmont Lithium began to approach Gaston County citizens about buying their land. Piedmont Lithium offered to buy one resident's land for a fixed price “without giving him an idea about the lithium’s actual value”. [10]

In August 2023 Piedmont Lithium spoke at the Gaston County Commissioners meeting in order to seek permitting approval. The Gaston County Commissioner, Allen Fraley, declined Piedmont's request for approval saying, “the door knocking should have already been done,” when the company proposed that they would go door to door to collect data on the number of residents who have private wells. [5] Fraley also “criticized the length of the mine’s expected usage by Piedmont Lithium, believing the time frame [of mine usage] is too short”. [7] Operations at Piedmont are being halted since the company needs to seek approval from the Gaston County Commission which has been giving them a “cool reception at meetings”. [3]

Through these negotiations the Gaston County residents continue to “remain skeptical about disrupting the environment they live around”. [7] In the aforementioned hearing, the commissioners “affirmed that no plans would be approved until Piedmont Lithium receives a mining permit from South Carolina”. [7]  This permit was obtained on April 15, 2024. [1]

Local news station WCNC Charlotte has reported on emails between Gaston Count residents, Gaston County Commissioners, and Piedmont Lithium regarding concerns about the amount of pollution the mine will produce. [11]

Business

Piedmont Lithium currently has multiple shares and deals in the mining industry. This includes a mining partnership with Sayona Mining with a mine in Quebec. Overall, “Piedmont owns one-quarter of the Canadian mine”. [3] In summer of 2023 the mine in Quebec brought in a total of $47 million in sales and provided Piedmont with a “$22.9 million dollar profit, the first in the company’s history”. [3] Piedmont Lithium's current CEO, Keith Phillips,  called the quarter of sales “transformational” for the company as stock prices rose. [3]

In September 2020, Piedmont signed a sales agreement with Tesla to supply high-purity lithium ore for up to ten years, [12] specifically to supply "spodumene concentrate ('SC6') from Piedmont's South Carolina deposit to Tesla." [13]

As of early 2021, Piedmont was exploring by drilling many sample cores across 2,300 acres (930 ha) of land it owns or has mineral rights to in Gaston County that surface prospecting had previously shown to contain substantial hard rock mineral deposits in the surface rock. [6]

With substantial demand growth for lithium occurring in the 2020s, [14] lithium mining and production companies are growing and some are experiencing marked increases in market valuation. [6] The stock prices of Piedmont Lithium, as well as Lithium Americas and MP Materials, increased substantially in early 2021 as a result of the increased importance of lithium to the global economy. [14]

In March 2021, Piedmont Lithium Ltd proposed a "re-domiciliation from Australia to the United States" under which a newly formed US corporation, Piedmont Lithium Inc, would acquire the Australian Company, if approved by the shareholders of Piedmont Lithium Ltd. [15] Shareholders approved the proposal on April 29, 2021. [16] and the company became redomiciled as a US corporation on May 17, 2021. [2]

The South Carolina state mining permit for the $1 billion Gaston County project and its 500-foot deep mine was issued on 15 April 2024. [1] A US$1 million reclamation bond will need to be posted before site work can begin, and a local zoning variance will need to be issued. [1]

The money garnered from the Quebec mine will be going towards Piedmont's projects in Gaston County, South Carolina and Tennessee. These projects will cost the company $1.8 billion and $800 million respectively. In the Fall of 2023, Phillips said that “[Piedmont Lithium] decided not to accept a $141.7 million federal Department of Energy (DOE) grant to help pay for the Tennessee plant”. [3] The company declined the loan because they say they need more money for the Tennessee plant. Instead, Piedmont is trying to obtain a DOE Advanced Technology Vehicle Manufacturing Loan which will give the company more money. [3]

This mine would significantly increase Piedmont Lithium's stock which will “keep investors happy”. [3] Piedmont's strategy is to meet the lithium mining demands of the US market and provide lithium to “automobile and battery makers” [3] such as Tesla. The market for electric vehicles and batteries has been expanding and Piedmont plans to “ramp up production to fill that demand”. [3]

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References

  1. 1 2 3 4 5 6 Scheyder, Ernest (April 15, 2024). "Tesla supplier Piedmont Lithium gets key North Carolina mining permit". Reuters. Retrieved April 16, 2024.
  2. 1 2 PIEDMONT LITHIUM INC. FORM 10-KT (Report). Securities and Exchange Commission. February 28, 2022. pp. 5–6. 001-38427. Retrieved November 15, 2023.
  3. 1 2 3 4 5 6 7 8 9 10 11 12 "Piedmont Lithium reports first profit, but still needs money and permits to build Gaston mine". WUNC. November 7, 2023. Retrieved April 30, 2024.
  4. ↑ Patterson, Scott (March 9, 2021). "America's Battery-Powered Car Hopes Ride on Lithium. One Producer Paves the Way". The Wall Street Journal. Retrieved April 30, 2024.
  5. 1 2 3 4 5 6 7 Sorg, Lisa (August 18, 2023). "Piedmont Lithium gets cold shoulder in Gaston County • NC Newsline". NC Newsline. Retrieved April 30, 2024.
  6. 1 2 3 4 5 6 Patterson, Scott; Ramkumar, Amrith (March 9, 2021). "America's Battery-Powered Car Hopes Ride on Lithium. One Producer Paves the Way". Wall Street Journal . Archived from the original on March 12, 2021. Retrieved March 13, 2021.
  7. 1 2 3 4 5 "Residents and commissioners remain unhappy with proposed Piedmont Lithium mine project". wcnc.com. August 9, 2023. Retrieved April 30, 2024.
  8. 1 2 Scheyder, Ernest (June 22, 2022). "Piedmont Lithium Looks Abroad amid North Carolina Uncertainty". Reuters. Retrieved April 20, 2024.
  9. ↑ Penn, Ivan; Lipton, Eric; Angotti-Jones, Gabriella (May 6, 2021). "The Lithium Gold Rush: Inside the Race to Power Electric Vehicles". The New York Times. ISSN   0362-4331 . Retrieved April 30, 2024.
  10. 1 2 3 "Mining for the Climate on Apple Podcasts". Apple Podcasts. February 5, 2024. Retrieved April 30, 2024.
  11. ↑ "'Sorry for my frankness, but let's get to it' | Emails detail growing frustration between Gaston County commissioners, Piedmont Lithium". wcnc.com. February 7, 2022. Retrieved April 30, 2024.
  12. ↑ Jamasmie, Cecilia (September 28, 2020). "Piedmont Lithium stock soars on confirmed Tesla deal". mining.com. Retrieved March 13, 2021.
  13. ↑ Piedmont Lithium Signs Sales Agreement with Tesla, 28 September 2020, retrieved 14 March 2021.
  14. 1 2 Smith, Rich (March 1, 2021). "Why Lithium Americas, Piedmont Lithium, and MP Materials Stocks Popped Today". Motley Fool . Archived from the original on March 4, 2021. Retrieved March 13, 2021.
  15. ↑ "Piedmont Lithium: Results of First Court Hearing". nasdaq.com. March 2, 2021. Retrieved March 13, 2021.
  16. ↑ "Piedmont Lithium Announces Results Of Scheme Meeting". Business Wire. April 29, 2021. Retrieved May 1, 2021.
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