Wesfarmers greenlights Mt Holland lithium expansion to double production
Wesfarmers (ASX:WES) and Sociedad Quimica y Minera de Chile S.A. (SQM) have jointly approved the final investment decision (FID) to expand the Mt Holland lithium project, spanning the mine, concentrator, and a new integrated ore sorting facility.
Announced on 22 July 2026, the expansion is set to double nameplate spodumene concentrate production from approximately 380,000 tonnes per annum (tpa) to 760,000 tpa on a 100 per cent basis. Wesfarmers points to lower unit operating costs and accelerated cash flows as the strategic drivers behind the decision.
The project is being delivered through Covalent Lithium, the joint venture company owned by Wesfarmers and SQM.
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What the expansion delivers
Covalent Lithium has completed a definitive feasibility study for the project, which centres on building a second concentrator alongside a new ore sorting facility. The ore sorting facility is designed to recover stockpiled material currently unsuitable for processing, adding capacity that would otherwise remain stranded.
Across the life of the operation, the ore sorting facility is expected to add approximately 3 million tonnes of spodumene concentrate production. The expanded volumes are expected to be sold as spodumene concentrate, with optionality to supply any future potential expansion of downstream processing at Covalent Lithium’s Kwinana refinery. Notably, that refinery expansion is not committed at this stage.
The roadmap for the expansion is set out below:
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Mine expansion — scaling extraction to support doubled output on a 100 per cent basis.
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Second concentrator — construction expected to commence in the second half of calendar year 2027 (H2 CY2027).
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Ore sorting facility — new integrated facility to recover stockpiled material, adding approximately 3Mt of spodumene concentrate over the life of operation.
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First expansion production — first spodumene concentrate volumes from the expansion expected in the first half of calendar year 2030 (H1 CY2030).
The investment case for shareholders
Wesfarmers’ share of capital expenditure for the project is estimated to be between $645 million and $715 million (between USD 450 million and USD 500 million) in nominal terms and excluding capitalised interest. The estimate also excludes life-of-mine capital expenditure.
The company has confirmed the commitment will be funded using existing cash and debt facilities. According to Managing Director Rob Scott, the decision reflects WesCEF’s ability to leverage the existing asset base and infrastructure, deploying follow-on capital to lower overall unit costs and drive shareholder returns.
The Wesfarmers 2026 Strategy Briefing, delivered in June, had already flagged a concentrator expansion FID as a near-term priority for WesCEF, situating the Mt Holland decision within a broader capital deployment agenda that spans Bunnings, Kmart, and the group’s chemicals and energy businesses.
On the regulatory front, the necessary government and regulatory approvals have either been secured or are underway. Wesfarmers has flagged that it will provide further updates on the expansion project at its full-year results in August 2026.
| Metric | Current | Post-Expansion | Investor Significance |
|---|---|---|---|
| Nameplate production | ~380,000 tpa | ~760,000 tpa | Doubling of output (100% basis) |
| Wesfarmers capex | — | $645M–$715M | Funded from existing cash/debt |
| First production | — | H1 CY2030 | Timeline to cash flow |
| Ore sorting uplift | — | ~3Mt over LOM | Recovers stranded stockpiles |
Managing Director Rob Scott
Rob Scott, Managing Director
“Mt Holland is a world-class, integrated lithium business and this expansion improves its position on the cost curve. The expansion of Mt Holland will deliver an attractive return on capital for Wesfarmers shareholders, enabling us to meet strong demand for high quality product and will enhance the resilience of the business through commodity price cycles.”
Understanding spodumene concentrate and why the cost curve matters
This is where the expansion connects to the strategy. The expansion delivers economies of scale and lowers overall unit costs, supporting greater resilience through commodity price cycles.
What comes next for Mt Holland
The near-term roadmap centres on construction and the path to first production:
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H2 CY2027 — construction of the second concentrator expected to commence.
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H1 CY2030 — first spodumene concentrate production volumes from the expansion expected.
The expanded volumes will be sold as spodumene concentrate, while preserving optionality to feed any future potential expansion of downstream processing at Covalent Lithium’s Kwinana refinery. That refinery expansion has not been committed.
Investors seeking further detail on the project economics and timeline can look to Wesfarmers’ full-year results in August 2026 for the next scheduled update.
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