Atlantic Lithium

DFS Confirms Project’s Economic Viability And Indicates Low Capital Intensity And Exceptional Profitability Potential

Atlantic Lithium Limited (AIM: ALL, ASX: A11, OTCQX: ALLIF, “Atlantic Lithium” or the “Company”), the African-focused lithium exploration and development company targeting to deliver Ghana’s first lithium mine, is pleased to announce its Definitive Feasibility Study (“DFS”) for the Ewoyaa Lithium Project (“Ewoyaa” or the “Project”) in Ghana, West Africa.


DFS HIGHLIGHTS:

  • 3.6 million tonnes (“Mt”) spodumene concentrate production over 12-year Life of Mine (“LOM”).
  • Exceptional Project economics: Post-tax Net Present Value (“NPV8”) of US$1.5bn with free cash flow of US$2.4bn from LOM revenues of US$6.6bn, Average LOM EBITDA of US$316 million per annum, Internal Rate of Return (“IRR”) of 105% and short payback of 19 months.
  • C1 cash operating costs of US$377/t of concentrate Free-On-Board (“FOB”) Ghana Port, after by-product credits from conventional open cut mining operation; All in Sustaining Cost (“AISC”) of US$610/t.
  • Modest capital cost estimate of US$185 million.
  • Incorporates Modular DMS units to generate early cash flow and increased throughput from 2Mtpa to 2.7Mtpa:
    • Modular DMS cash flow reduces mine build peak funding requirement; capex paid back prior to full completion of plant build; and
    • DFS maintains low capital intensity of US$64/t of annualised throughput.
  • Throughput increased by 35% following significant uplift in Ore Reserves to 25.6Mt @ 1.22% Li2O.
  • Simple mineralogy enables simple flowsheet comprising integrated 3-stage crushing facility through conventional Dense Media Separation (“DMS”) processing, producing 6% (“SC6”) and 5.5% (“SC5.5”) concentrate (approx. 50:50 ratio) at 10mm top size crush.
  • Additional 4.7Mt of secondary product anticipated as by-product from DMS concentrator, with average grade of 1.16% Li2O.
  • DFS incorporates Mineral Resource Estimate1 (“MRE”) of 35.3Mt @ 1.25 Li2O and conservative LOM concentrate pricing of US$1,587/t, FOB Ghana Port.
  • Project benefits from close proximity to operational infrastructure, low energy and water-intensity process flow sheet, proximity to potential off-takers and skilled Ghanaian workforce within surrounding communities; over 800 direct jobs to be created.
Commenting, Keith Muller, Chief Executive Officer of Atlantic Lithium, said: “The Definitive Feasibility study has reaffirmed the Ewoyaa Lithium Project’s impressive economic outcomes and profitability potential, providing improved confidence in Ewoyaa’s ability to become a significant, near-term producer of spodumene concentrate.

“Using conservative pricing, the DFS outlines 3.6Mt concentrate production over a 12-year mine life, delivering US$6.6bn Life of Mine revenues, a post-tax NPV8 of US$1.5bn and an Internal Rate of Return of 105%. The Study indicates payback within only 19 months and maintains a low capital intensity, further reinforcing Ewoyaa’s position among the leading pre-production hard rock lithium assets globally.

"The increase in capex from the PFS results from the inclusion of the Modular DMS units and the increased throughput of 2.7Mtpa. Early revenue generated by the Modular DMS units will reduce peak funding requirement for the mine build, strongly justifying these developments. Furthermore, this will provide a valuable opportunity to train national staff and engineer out any mining, materials handling or logistics bottlenecks ahead of large-scale operations commencing for a potentially quicker commissioning phase.

“The deployment of the Modular DMS units has been reallocated from Stage 2 to Stage 1 of the Project’s development. Stage 2 includes the evaluation of a Feldspar circuit, a by-product of the DMS process that we intend to supply to the local Ghanaian ceramics market, and a Flotation circuit, further enhancing the Project’s economics.

“Ewoyaa’s favourable mineralogy enables a simple flowsheet comprising a 3-stage crushing facility and Dense Media Separation processing from conventional, open pit mining to produce a spodumene concentrate proven suitable for carbonate, sulphide or hydroxide conversion. Due to its grade, the Project’s coastal location and against the backdrop of the global decarbonisation movement, demand from off-takers for product from Ewoyaa has been strong.

“The Project benefits from a low water and energy-intensive plant, close proximity to exceptional infrastructure, including adjacent grid power, as well as a skilled Ghanaian workforce within Ewoyaa’s supportive surrounding communities. These favourable characteristics underlie the viability of the Project.

“Understanding the role we can play, we are fully committed to the development of our host communities. This includes local investment via a community development fund, apportioning an equivalent of 1% of retained earnings to local initiatives, and the creation of employment opportunities. As we set our sights on first production, we firmly believe that Ewoyaa will deliver long-lasting benefits for the Central Region, to Ghana and to West Africa.”


Click here for the full ASX Release

This article includes content from Atlantic Lithium, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.

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The company’s board of directors acknowledged media reports on the situation in a press release late last week, saying it wants to ensure the successful development of the asset.

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Adam Webb, head of battery raw materials at Benchmark Mineral Intelligence, said at the Benchmark Summit in March that lithium carbonate prices are expected to remain about where they are, at US$10,400 per metric ton.

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Atlantic Lithium

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