Weekly Lithium Lowdown with Chris Williams – Week 45, 2023
Infinity Lithium unveils ‘new look’ Scoping Study for the San Jose project in Spain
Infinity Lithium announced updated Scoping Study results for its San Jose zinnwaldite project in Spain this week. The company envisages an underground mine feeding a 2 Mtpa hydromet plant. Crushed ore is put through a high-pressure sulphuric acid leaching process to produce lithium sulphate before neutralization, impurity removal and causticisation to lithium hydroxide. Relative to the 2021 PEA which used a flotation and sulphate roast water leach process, recoveries are now 90% (from 53%) resulting in 33 ktpa of lithium hydroxide output (up from 19.5 ktpa).
The initial CAPEX is US$1,544M (including 20% contingency), while the operating cost EXW Spain is estimated at US$5,922/t LiOH.H2O including by-products (US$6,730/t LCE). Using a flat price of US$27,000/t LiOH.H2O the NPV8% comes in at US$2.87Bn post-tax.
Adamas take: The ambitious project now shares a capital intensity in line with Thacker Pass and perhaps equally as difficult regulatory and technical challenges. The project will sure test the determination of Europe on its quest for lithium self-sufficiency.
Sibelco – Avalon joint venture finalised
Avalon Advanced Materials and Sibelco have closed a joint venture agreement, first announced in June 2023. Avalon contributes its Canadian hard rock lithium assets in return for ~€34.87M (~C$51.3M) JV cash contribution, resulting in a 60/40 Sibelco-Avalon JV. Concurrently, Avalon has issued a private placement to Sibelco raising C$10M for 19.9% of Avalon’s shares together with a C$3M secured loan.
The deal involves the PEA stage Separation Rapids petalite-lepidolite project and the exploration stage Lilypad cesium-tantalum-lithium(spodumene) asset. Avalon is working with Metso to develop a petalite concentrate to lithium hydroxide processing facility in Thunder Bay, Ontario.
Adamas take: Although not your typical spodumene M&A event, the JV is a healthy development for Ontario and its lithium-bearing mineral projects which need some encouragement when competing with the likes of Quebec or Western Australia. The implied valuation of $143/t LCE is decently high when considering market conditions and the rate of progress seen on the project.
POSCO signs MOU to invest in oilfield brines
POSCO has signed an MOU with a private investment company Invest Alberta Corporation with the intention to invest in oilfield brine lithium extraction projects.
The scope is broadly set to evaluate exploration and development opportunities with viable commercial processes for lithium extraction.
Invest Alberta Corporation will provide administrative support, critical resource development information, tax incentives, and networking opportunities.
Adamas take: In a culture where MOUs are taken seriously, so should the intentions of POSCO here. The company is not shy with trying different approaches, such as its phosphate precipitation technology being put into practice at the Hombre Muerto salar, Argentina.
Chris Williams, Analyst at Adamas Intelligence
Chris is an Analyst at Adamas Intelligence focused on the global lithium industry. He researches and analyzes the lithium value chain to uncover actionable opportunities for clients.
Chris has 11-years experience in mining and oil & gas operations optimization, delivering value from data intensive insight generation. He completed his Bachelor and Masters of Engineering at the University of Queensland, majoring in Mechanical Engineering, and is currently completing a Masters of Business Administration at the University of British Columbia.
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