PLS signs 20-year power deal with Fortescue as lithium prices slump
PLS Group signed a 20-year power supply agreement with Fortescue for its Pilgangoora mine, expected to cut unit costs of the P2000 expansion by up to A$20 a ton.
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what happened
According to Interview, PLS Group has signed a 20-year power supply agreement with iron-ore producer Fortescue. The deal is meant to help the Pilgangoora operation, one of the world's largest hard-rock lithium mines, cope better with sharp swings in lithium prices.
The contract was signed on Wednesday, less than two weeks after the company approved the P2000 project, valued at 1.9 billion Australian dollars (about US$1.3 billion). The project aims to significantly expand output of lithium-rich spodumene concentrate, even though spodumene prices have fallen by more than 30% over the past three months.
CEO Dale Henderson said the power arrangement should cover most of the mine's electricity needs from 2029. He estimated it would lower P2000 unit operating costs by up to A$20 a metric ton, to about A$600. Fortescue becomes the first external customer of its green energy network in the Pilbara region.
why it matters
The contract matters beyond its headline numbers. Lower energy costs make PLS production more resilient to lithium price cycles, which have been highly volatile in recent years, a point investors in lithium producers will watch closely.
market impact
PLS shares: lower costs help protect margins while lithium prices remain weak
- PLS shares pressure up — lower P2000 unit costs strengthen the company's competitive position
tags
instruments
sources
- PLS Power Deal With Fortescue Helps Cushion Giant Mine Against Choppy Lithium Market — Interview, 28 October 2026 at 05:17 UTC
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