The Conversation (0)
European Lithium Limited (ASX: EUR, FRA:PF8, OTC: EULIF) (European Lithium or the Company) is pleased to present the results of its Definitive Feasibility Study (Wolfsberg DFS or DFS) for its wholly owned Wolfsberg Lithium Project, located in Austria (Wolfsberg Lithium Project or Wolfsberg Project). The Wolfsberg DFS has been delivered by DRA Projects (Pty) Ltd (DRA), a diversified global engineering, project delivery and operations management group.
HIGHLIGHTS
- The Definitive Feasibility Study (DFS) demonstrates that the Wolfsberg Lithium project is set to deliver high returns, leveraging low operating costs, and benefiting from a lithium market which is anticipated to be in structural undersupply during most of the life of mine;
- Battery grade Lithium Hydroxide Monohydrate (LHM) production is ~ 8,800 tpa for 14.6 years;
- LHM OPEX (after byproducts) is US$ 17,016/t LHM on average compared to reported spot prices for LHM in February 2023 of US$ 79,500 DDP Antwerp;
- LHM prices2 modelled in the DFS are projected to be at a 39% discount to current spot prices in 2025 and then escalate by 2% per annum;
- Estimated CAPEX is US$ 866 million which supports a post-tax NPV of US$ 1.5 billion @ WACC1 6%;
- Acceleration of decarbonization and energy transition in Europe combined with the rapid adoption of electric vehicles provides further upside; and
- Construction of downstream project facilities expected Q4, 2023.
The financial results of the DFS are set out in the table below:
Executive Summary
The Wolfsberg Project is held through European Lithium AT GmbH, a 100% owned subsidiary of European Lithium. European Lithium is aiming to be Europe’s first and largest local supplier of critical lithium hydroxide monohydrate (LHM) in the region.
Tony Sage, Chairman, commented on the DFS results: “The robust DFS provided by DRA provides confidence in the commercialisation of the Wolfsberg Project. This positive news has come during a buoyant market for lithium and an increased urgency for decisive action to accelerate the green energy transition, especially in Europe. Our next steps include finalisation of the listing of Critical Metals on NASDAQ and continuing our discussions with our financiers. Through the business combination with Sizzle, Critical Metals Corp. expect to access substantial opportunities available in the U.S. market.”
Building on completion of the Pre-Feasibility Study (PFS) for the Wolfsberg Project in April 2018, the Company conducted extensive infill geological drilling, mineral processing and metallurgical test work, built a pilot test facility which produced 1.7 t of bulk spodumene concentrate, updated its marketing studies and completed environmental mitigation studies. The results of this work has flowed into the Wolfsberg DFS which provides an accurate and detailed analysis of the compelling economics for the Wolfsberg Project.
The DFS has been prepared to international standards with Mineral Resource and Ore Reserve estimates prepared in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code, 2012) guidelines, as published by the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia.
The Wolfsberg DFS plans an average (steady state) mine production rate of 780 kt/a, peaking at 840 kt/a over the Life of Mine (LOM) which is based on an Ore Reserve of 11.5 Mt, mined over approximately 15 years. The Project will comprise two integrated operations, a mining and processing operation to produce a lithium concentrate (spodumene), and a hydrometallurgical plant to convert the spodumene into battery grade LHM. The hydrometallurgical plant is planned to produce approximately 8.8 kt/a LHM with a total production of approximately 129 kt of LHM over the LOM. The forecast pricing assumptions for LHM are based on a 39% discount to current spot prices in Europe (~ USD 48 600/t) in 2025 which then escalate with United States Consumer Price Index (CPI) from 2026 onwards (refer to paragraph 9.6).
Field surveys for fauna and flora have been completed at the planned mine and concentrator site location. The DFS demonstrates that a mining fleet of battery electric vehicles (BEVs) can be economically viable for the Wolfsberg Project. The study confirms that that the underground portal, concentrator, and all the required surface infrastructure can be located within an area of less than 10 ha, which has significantly reduced the Wolfsberg Project’s environmental footprint.
European Lithium is committed to the sustainable development of its Wolfsberg Project, utilising the most advanced mining and processing technologies to become a reliable low carbon producer of LHM and be a key part of the emerging lithium supply chain in Europe.
Click here for the full ASX Release
This article includes content from European Lithium Limited, 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.
EUR:AU
European Lithium Investor Kit
- Corporate info
- Insights
- Growth strategies
- Upcoming projects
GET YOUR FREE INVESTOR KIT
European Lithium
Overview
As the global push to halt climate change gains momentum, the European Commission is looking to regionalize the battery supply chain to capitalize on the rapid electric vehicle (EV) growth and limit its dependency on other countries through heavy investment and policy changes. Europe’s electric vehicle market value reached US$29.49 million in 2021 and is projected to increase up to US$143.08 million by 2027, indicating a compounded annual growth rate of 23.4 percent in that period.
Even though Europe is one of the largest global producers of motor vehicles, it currently does not have a local supply of lithium hydroxide which is heavily used in EV battery technology. According to experts, the market is set to remain in a structural shortage until 2025
One company that aims to become the first local lithium supplier into an integrated European battery supply chain is European Lithium (ASX:EUR,FRA:PF8), a mining exploration and development company focused on exploring, identifying and acquiring lithium in Europe. The company is led by a management team with decades of experience and success in the mining and finance markets.
“Our aim is to be the first supplier of lithium from Europe, for Europe,” European Lithium chairman Tony Sage said.
The company is focused on its wholly owned Wolfsberg Lithium project located in Carinthia, Austria. The pre-existing mine is located in a mining-friendly region with multiple mineral discoveries in the surrounding area. The property features a high-grade lithium resource at an average grade of one percent lithium hydroxide, with a total resource of 12.88 million tonnes based on resources measured, indicated and inferred in zone 1 only.
The Wolfsberg Lithium project resource has the potential to double based on positive drill results in another zone on the property.
Based on the definitive feasibility study (DFS) released in March 2023, Wolfsberg Lithium Project is well positioned to become a leading producer of battery-grade lithium hydroxide in Europe. It is set to deliver high returns, leveraging low operating costs, and benefiting from a lithium market that is anticipated to be in structural undersupply during most of the life of mine. The battery-grade lithium hydroxide monohydrate (LHM) prices modeled in the DFS are projected to be at a 39-percent discount to current spot prices in 2025 and then escalate by 2 percent per annum. The estimated capex is US$866 million which supports a post-tax NPV of US$1.5 billion.
European Lithium has established several strategic relationships with an aim to deliver value to the Wolfsberg Lithium Project through development and during production. This includes a partnership with KMI for liaising with Austrian authorities.
The company commissioned Dorfner Anzaplan to construct the pilot plant, which was successfully completed on schedule. Anzaplan has also overseen the completion of metallurgical test work on bulk ore extractions. Testing will allow significantly higher recovery rates at the start of production as opposed to only assessing metallurgical data from the core as other mining companies often do, giving European Lithium the advantage of a streamline refinement process.
The company has support from the European Battery Alliance, GREENPEG and other government initiatives, believing it has the potential to become a major, first-to-market producer of lithium in Europe. The company also remains committed to clean production in an effort to support sustainability.
Based on the DFS, the company plans to begin the permitting process of its Wolfsberg Lithium project and prepare the mining plan for the mining authority to authorize the mine and concentrator construction. Afterward, the company will determine the approval requirements of the carbonate hydroxide conversion plant with the Energy Information Administration (EIA) and then initiate the final financing plan.
European Lithium, through its wholly owned Austrian subsidiary ECM Lithium Aľ GmbH (ECM), signed a binding long-term lithium offtake agreement with top-tier European auto manufacturer BMW to secure the company’s first offtake of battery grade lithium hydroxide from its Wolfsberg Lithium Project in Austria.
The company is aiming to commence production of lithium hydroxide from the project in 2027 — subject to funding and approvals by the Austrian government.
In a bid to expand its project portfolio, European Lithium executed a binding Heads of Agreement with 2743718 Ontario Inc., a subsidiary of Richmond Minerals (TSXVRMD), to acquire 100 percent of the rights, title and interest in the Bretstein-Lachtal Project, Klementkogel Project and the Wildbachgraben Project, a group of exploration licenses covering 114.6 square kilometers, targeting lithium with known occurrences in the Styria mining district of Austria.Company Highlights
- European Lithium is a mining exploration and development company focused on exploring, identifying and acquiring lithium in Europe.
- The company aims to become the first local lithium supplier into an integrated European battery supply chain.
- The company’s focus is on its wholly owned advanced Wolfsberg Lithium Project (Wolfsberg) located in Carinthia, Austria.
- Wolfsberg is a high-grade lithium resource at an average grade of one percent lithium oxide, with a total resource of 12.88 million tonnes based on measured, indicated and inferred resources in zone one only.
- Wolfsberg’s definitive feasibility study results demonstrate potential to deliver high returns, leveraging low operating costs, and benefiting from a lithium market that is anticipated to be in structural undersupply during most of the life of mine.
- The Wolfsberg resource estimate has significant upside with the potential to double based on positive drill results.
- Through its wholly owned Austrian subsidiary ECM Lithium Aľ GmbH (ECM), European Lithium signed a binding long-term lithium offtake agreement with top-tier European auto manufacturer BMW AG (BMW) to secure the company’s first offtake of battery-grade lithium hydroxide from Wolfsberg.
- The company has signed a binding agreement to build a Saudi Arabia-based hydroxide processing plant in partnership with Obeikan and deliver significant cost savings.
- The company is led by a management team with decades of experience and success in the mining and finance markets.
- European Lithium entered into a business combination agreement with Sizzle Acquisition, a US special purpose acquisition company, to which European Lithium will sell down its interest in its wholly owned Wolfsberg Lithium Project (Wolfsberg and Wolfsberg Lithium Project) and merge with Sizzle via a newly formed, lithium exploration and development company named, Critical Metals Corp.
- European Lithium has acquired 100 percent of the rights, title and interest in the Bretstein-Lachtal Project, Klementkogel Project and the Wildbachgraben Project, a group of exploration licenses covering 114.6 square kilometers, targeting lithium with known occurrences in the Styria mining district of Austria and nearby the Wolfsberg Lithium Project
- The company received high-grade lithium assays from sampling undertaken at various prospects within the Eastern Alps Lithium Satellite Projects, located in Austria, which are held 20 percent by European Lithium and 80 percent by EV Resources Limited (ASX: EVR).
Get access to more exclusive Lithium Investing Stock profiles here
Developing the Advanced Wolfsberg Lithium Deposit in Austria
European Lithium Investor Kit
- Corporate info
- Insights
- Growth strategies
- Upcoming projects