Highlights

  • Underground development at Kathleen Valley reached a quarterly record of 4,021 metres during September 2026.
  • Concentrate production fell to 77,982 dry metric tonnes as ore processed dropped 21% quarter on quarter.
  • Unit operating costs of A$1,259 per dmt sold exceeded the top of FY27 guidance of A$1,050–1,250 per dmt.
  • A A$389 million expansion was approved at final investment decision in September 2026, targeting average output of about 780,000 dmt per year from FY30 to FY34.

Liontown Limited (ASX:LTR) posted a quarterly record for underground development metres at its Kathleen Valley lithium operation in Western Australia during September 2026, yet lower plant throughput and slipping recoveries cut concentrate output and pushed costs beyond its published annual guidance range.

Mining Up, Plant Output Down

Underground ore mined rose 9% quarter on quarter to 388,568 tonnes at 1.4% lithium oxide, and underground development reached a quarterly record of 4,021 metres. Liontown said underground mining ran at about 1.6 million tonnes per annum, in line with plan, and is expected to step up to about 1.9 Mtpa in the December quarter. The 2.8 Mtpa target for end of FY27 was described as on track. Ore processed, however, fell 21% to 508,000 dry metric tonnes at a feed grade of 1.3% Li2O. Lithia recovery slipped to 60% from 63%, which the company attributed to higher contamination in open pit stockpile feed, although plant availability was a record 94%.

Concentrate production was 77,982 dmt at 5.1% Li2O, compared with 103,111 dmt in the June quarter. Sales totalled 82,561 dmt across five parcels, with one shipment slipping into the December quarter.

Prices, Costs and Cash

Liontown's realised price rose to US$1,966 per dmt on an SC6 equivalent basis from US$1,880. Unit operating costs came in at A$1,259 per dmt sold (FOB), above the top of FY27 guidance of A$1,050–1,250 per dmt, which the company attributed to lower fixed-cost dilution and lower recovery. Revenue was A$199 million for the quarter, down from A$235 million in June as sales volumes fell. Cash at bank was A$502.1 million at 30 September.

Expansion Approved

Liontown approved a A$389 million expansion at final investment decision in September 2026. The project is designed to lift ore mining to about 4.1 Mtpa from FY30 and processing capacity from about 2.8 Mtpa to 4.2 Mtpa, targeting average production of about 780,000 dmt per year over FY30 to FY34 at a unit operating cost of A$840–920 per dmt. These are targets, not results. Total FY27 capital expenditure guidance was updated to A$435–495 million. Managing director Tony Ottaviano said: "We are looking through short-term lithium price movements and investing in Kathleen Valley today."

Safety and Milestones

The rolling 12-month total recordable injury frequency rate rose to 14.16 from 10.99, and the company started a two-year safety culture programme in October. Upcoming milestones include lifting underground mining to about 1.9 Mtpa in the December quarter, delivering a new ball mill, commissioning a third paste pump in the March 2027 quarter, and first ore from Kathleen's Corner Underground in the September 2027 quarter.