Name of the Project
Mina do Barroso lithium project.

Location
The project is located near Boticas, in northern Portugal.

Project Owner/s
Savannah Resources.

Project Description
A scoping study has confirmed that Mina do Barroso has the potential to be a major European producer of spodumene lithium, with robust project economics and the potential to deliver substantial shareholder value.

The study is considered a base case for the project and is based on a mine and concentrator-only development for the production of spodumene concentrate.

The project will use a contract miner and fleet.

Conceptual openpit mine planning has been developed, targeting a plant feed rate of 1.3-million tonnes a year, with an estimated average life-of-mine (LoM) mill head grade of 1.02% (diluted) lithium oxide and an average overall strip ratio of 5.2:1 (waste:ore ratio). The project will have an LoM exceeding 11 years.

The flowsheet comprises a combined 1.3-million-tonne-a-year dense-media separation and flotation circuit, with an overall plant availability of 85% for the recovery of spodumene. The study estimates average production of 175 000 t/y of spodumene concentrate at 6% lithium oxide.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at an 8% discount rate, of $356-million and an internal rate of return of 63.2%, with a payback of 1.7 years.

Capital Expenditure
Initial capital expenditure is estimated at between $109-million and $124.6-million

Planned Start/End Date
Production is expected to start in the first quarter of 2020.

Latest Developments
Savannah expects to deliver a definitive feasibility study (DFS) in the second quarter of next year.

The timeframe for the DFS has been extended from a previous target of early 2019, to allow for additional work to be completed. The additional work stems from the discovery and subsequent delineation of new orebodies, which means that drilling campaigns have had to be extended, mine designs reworked and pit sequencing plans revised.

The project’s metallurgical testwork programme has also been expanded to not only include samples from the newly discovered deposits, but also to evaluate all ore types that will be treated amid the processing challenges reported by the first wave of new spodumene producers in Australia over the past year.

Meanwhile, the company has advanced discussions with a number of potential offtake partners, ranging from established lithium processors to large-scale end-users such as automotive manufacturers.

Political interest in the project has also increased as appreciation has grown for the strategic role that Mina do Barroso could play in anchoring a new lithium industry in Europe, and Portugal in particular.

Key Contracts and Suppliers
Hatch (engineering services); PayneGeo (geological model and resource estimations); Minesure (analysis and definition of the scoping level mining inventory and contractor costs); Primero Group (primary engineering group and lead manager for the feasibility study); Knight Piésold (lead geotechnical and hydrological engineering); Quadrant (consultant on transport and logistics requirements), Nagrom (assay and metallurgical testwork services), ALS (assay and metallurgical testwork services); VISA Consultores (environmental-impact statement assessment); CV&A Consultores and S317 Consulting (stakeholder management strategy, community engagement plan and sourcing of European Union funding); and Noah’s Rule (financial adviser).

On Budget and on Time?
Not stated.

Contact Details for Project Information
Savannah Resources, David Archer, tel +44 20 7117 2489.