The Galaxy Resources Limited (ASX: GXY) share price is up more than 3% after reporting its June quarter numbers.
Galaxy is a lithium business that has hard rock mines and brine assets in Australia, Canada and Argentina. It also owns lithium production facilities. It wholly owns the Mt Cattlin mine in Ravensthorpe, Western Australia. One of Galaxy’s key assets is the Sal de Vida lithium project which the company says has the potential to be an excellent low-cost brine-based lithium carbonate production facility.
Galaxy Resources June Quarter
Galaxy said that it achieved a record quarter of production results at Mt Cattlin. The production volume was 56,460 dry metric tonnes (dmt), exceeding guidance of 45,000 dmt to 50,000 dmt. The grading was 6.0% Li2O.
The Mt Cattlin production unit cash cost of US$337 per dmt produced makes it one of lowest costing lithium concentrate operations in the world, according to Galaxy.
A total of 29,439 dmt of lithium was shipped in the quarter, with a target of 60,000 dmt to 70,000 dmt to be shipped in the third quarter of 2019.
Galaxy Development Projects
Galaxy said that the pilot pond earthworks for the Sal de Vida Project have been completed with pond liners to be installed during the third quarter of 2019. Preliminary testing of alternative process technologies for Sal de Vida has achieved superior lithium extraction results than those recorded in the existing base case flowsheet.
The company also said the Argentine management team has been bolstered by three senior appointments.
Feasibility works have been progressed to plan for the James Bay Project and phase 2 test work on the upstream operation at James Bay is nearing completion, Galaxy said this validates the process design criteria of the concentrator.
Management also said that an outcropping ‘pegmatite’ 2.5km north of Mt Cattlin has been identified and will be drill tested in the September quarter.
Is Galaxy A Buy?
The company had US$176.3 million of cash and zero debt at 30 June 2019, so it appears to be in good shape as the shipping of lithium ramps up.
Galaxy is doing well on the business side of things, but I’m not sure what the price is for Galaxy shares because the future price of lithium is uncertain. If I were investing for exciting growth potential I’d rather think about the rapidly growing businesses in the free report below.
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