IGO Cuts Greenbushes Lithium Mine Capex Forecast as Market Weakness Persists
IGO Ltd has reduced its fiscal 2025 capital expenditure forecast for the Greenbushes lithium mine in Western Australia, now expecting to spend A$700 million to A$800 million (USD $447–$511 million), down from its previous estimate of A$850 million to A$950 million (USD $543–$607 million). The company attributed the cut to a review and optimization of its project capital portfolio amid ongoing market challenges for lithium producers according to the company's latest statement.
Greenbushes, jointly owned by IGO, Tianqi Lithium, and Albemarle Corp, remains Western Australia’s longest continuously operated mining area. The mine produced 341,000 metric tons of spodumene concentrate in the third quarter, a 13% sequential decline. IGO previously noted that the lithium market has been challenging, with prices for spodumene, lithium carbonate, and lithium hydroxide falling by up to 70% in fiscal 2024.
The broader lithium sector continues to feel the impact of a 90% price collapse over the past two years. While some mines have curtailed operations or delayed expansions, others have kept production running, often supported by Chinese battery manufacturers. Earlier this year, IGO and Tianqi Lithium agreed to halt all work at one of their lithium hydroxide plants in Western Australia, reflecting persistent market headwinds as reported in January.
The decision to stop operations at the Kwinana lithium hydroxide plant followed significant writedowns on IGO’s nickel operations, prompting a strategic review as global nickel oversupply drove prices lower last year. Despite these challenges, IGO reported underlying EBITDA of A$34 million (USD $21.7 million) for the third quarter, a turnaround from the previous quarter’s A$79 million (USD $50.5 million) loss.
Shares of IGO fell nearly 1.9% following the announcement, underperforming the broader mining index. The company remains focused on operational improvements and optimizing its asset portfolio as the lithium and nickel markets continue to face volatility.
