Atlantic Lithium is expected to see significant progress following the company’s pre-feasibility study (PFS) for the Ewoyaa Lithium Project, significantly improving on the project economics.
Atlantic Lithium is expected to complete the pre-feasibility study in Q3 2022, and likely to add to the results obtained during the previous scoping study which returned a post-tax NPV8 (net present value using an 8% discount rate) of US$789 million and a post-tax internal rate of return (IRR) of 194%.
Additionally, Atlantic Lithium completed metallurgical test-work, which will feed into the pre-feasibility study, and supports using a gravity separation plant at a coarser primary crush size, which is likely to reduce the capital cost of the plant.
Interim Chief Executive, Lennard Kolff, said:
“Results have successfully demonstrated that we are able to produce high-purity, low contaminants 6% Li2O SC6 spodumene concentrate at a coarse 10mm crush, which is much coarser than previously projected in the scoping study, providing potential for lower operating costs.
“The project is exceptionally well located, being only 1 km from the sealed national highway and 110 km from the operating deep-sea port of Takoradi with adjacent grid power; we believe it is challenging to find better located lithium pegmatite projects elsewhere.”
Lennard Kolff
Metallurgical Tests Support Low Costs
The metallurgical test results support a low capex gravity separation plant at the coarser 10mm primary crush size, larger than the finer 6.3mm crush size estimated in a scoping study. This development could also potentially lower the operating cost of the project, further improving the economics compared to the base case scoping study.
“Results have consistently delivered lithium and feldspar concentrate quality that exceeds off-taker requirements and reaffirms the suitability of a simple dense medium gravity separation process route, boding well for low capital costs, operating costs and carbon intensities.”
“With Ewoyaa being funded to production through our agreement with Piedmont Lithium, these metallurgical results continue to highlight the exceptional potential of the project and the value that it brings to the company and our shareholders.”
Lennard Kolff
Additional improvements to the project’s potential economics are expected to come from the JORC 2012 compliant mineral resource upgrade, announced in March 2022. This upgrade saw Atlantic’s resource base increase by an impressive 42% to 30.1 million tonnes at an average grade of 1.26% Li2O.
The previously completed scoping study was based on a resource base of 21.3 million tonnes for a two million tonnes per annum operation, producing an expected average of 300,000 tonnes (t) per annum of 6% Li2O spodumene concentrate (SC6) over an 11.4 year mine life.
The larger resource base could increase the mine life, increase the size of the processing plant, or both, allowing the company to produce more spodumene concentrate per annum over a longer period of time.
Atlantic Lithium has acknowledged that there is a substantial improvement in project metrics with a mine life over 15 years, previously estimating that every additional year of production will add up to an expected US$60 million to the post-tax NPV.
In addition, the SC6 price used in the scoping study is a US$900/t, current auction prices are between US$5,000/t and US$6,500/t, this could have a material impact on the project’s metrics.
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