Pilbara Minerals Ltd (ASX:PLS) share price higher on Pilgangoora lithium-tantalum project news

On Monday morning the Pilbara Minerals Ltd (ASX: PLS) share price has pushed higher following the release of an update on the expansion of its Pilgangoora lithium-tantalum project.

At the time of writing the lithium miner’s shares are up 1.2% to 84.5 cents.

What was the update?

This morning the lithium miner released details of its final investment decision in relation to expanding production at the lithium-tantalum project beyond 800ktpa of high quality spodumene concentrate.

According to the release, the company’s board has resolved to approve the stage 2 expansion of the project subject to securing necessary approvals and the balance of project funding.

As a result, major site works are expected to commence following completion of the balance of the project’s financing and receipt of final environmental approvals.

The good news for shareholders is that although production is going to increase significantly, there’s no danger of its product going unsold. Strong demand has led to a series of offtake agreements being signed with the likes of POSCO, Ganfeng Lithium, and Great Wall Motor Company. Combined, these agreements account for 100% of stage 2 offtake.

In addition to this, management provided an update on its second shipment of spodumene concentrate. That shipment departed Port Hedland in the second half of October with 6.3% lithium oxide onboard. This is “further confirmation of Pilbara Minerals’ continued success with the Stage 1 development” according to management.

Should you invest?

I think this news demonstrates why Pilbara Minerals is one of the best lithium miners on the local share market along with Galaxy Resources Limited (ASX: GXY) and Orocobre Limited (ASX: ORE).

However, the lithium miners are some of the highest risk investment options on the local market and their success will be largely down to where lithium prices go in the future.

While I’m optimistic that demand will grow enough to offset the rising supply and keep prices elevated, if it doesn’t lithium prices could crumble along with lithium miner share prices.

Instead of the lithium miners these exciting tech shares could be worth a closer look right now.

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