PERTH (miningweekly.com) – An updated prefeasibility study (PFS) into the Goulamina lithium project, in Mali, has shown improved economics and an extended mine life on the back of an increase to the mineral resource.

ASX-listed Birimian on Wednesday told shareholders that a two-million-tonne-a-year mineral concentrating plant and an opencut operation have been recommended as the preferred development scenario.

Under this scenario, Goulamina will produce an average 362 000 t/y of spodumene concentrate, or a total of 5.7-million tonnes of concentrate over an initial mine life of 16 years.

This compared with life-of-mine (LoM) production of 3.6-million tonnes over a 12 year period in the initial PFS of 2017.

The updated PFS estimated a post-tax net present value (NPV) of A$653-million and an internal rate of return (IRR) of 49.5%, while the project’s capital cost was estimated at A$196-million.

In comparison, the 2017 PFS estimated a post-tax NPV of A$136.3-million and an IRR of 25% for a two-million-tonne-a-year operation, with capital costs estimated at A$126.2-million.

The updated PFS estimated LoM earnings before interest, taxes, depreciation and amortisation (Ebitda) of A$2.6-billion with average Ebitda of A$171-million a year. Net cash flows from operations are expected to reach A$2.3-billion over the mine life, or A$150-million a year.

The mineral resource at Goulamina has increased from 32.9-million tonnes used for the initial PFS, to 103.2-million tonnes, with Birimian on Wednesday also reporting a maiden ore reserve of 31.2-million tonnes, grading 1.56% lithium oxide.

Birimian CEO and executive director Greg Walker said the declaration of a maiden ore reserve was a major milestone for the company.

“The fact that the company has been able to announce a substantial ore reserve of more than 32-million tonnes, sufficient to support mining operations for an initial 16 years, and at a high grade of 1.56% lithium oxide is indicative of the outstanding quality of the project.

“The significant result at Goulamina and the upside demonstrated by the recently announced increased mineral resource positions this project as one of the world’s leading hard rock lithium projects.”

Birimian will undertake infill and extension drilling later this year aimed at increasing the ore reserve, with the company also expected to carry out further resource extensions and definition drilling at other identified pegmatite systems at Goulamina.

Birimian was still targeting a start of construction in the first half of 2019, with commissioning slated for the first half of 2020.

The company will now work on completing its environmental studies and permitting, definitive engineering studies, securing project funding and offtake agreements, and procuring long-lead items.