Name of the Project
Kathleen Valley lithium/tantalum project.

Location
North-east Goldfields of Western Australia.

Project Owner/s
Liontown Resources.

Project Description
A definitive feasibility study (DFS) has confirmed the potential to develop a state-of-the-art, second-generation lithium/tantalum mining and processing operation.

The DFS optimises the mine schedule, process plant design and forecast sales pricing to enhance the technical and financial viability of a standalone, long-life, four-million-tonne-a-year operation.

The project has an ore reserve of 68.5-million tonnes grading 1.34% lithium oxide and 120 parts per million tantalum pentoxide, underpinning an initial estimated 23-year mine life, based on the updated mining schedule.

Building on the October 2020 prefeasibility study, the DFS base production has been increased from two-million tonnes a year to 2.5-million tonnes a year producing about 500 000 t/y of spodumene concentrate, with a four-million-tonne-a-year expansion planned in Year 6 to deliver about 700 000 t/y spodumene concentrate.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has an after-tax net present value, at a real 8% discount rate, of A$4.2-billion and an internal rate of return of 57%, with a payback of 2.3 years.

Capital Expenditure
Initial project capital is estimated at A$437-million.

Planned Start/End Date
First production expected to start in the first half of 2024.

Latest Developments
Liontown has launched a fully underwritten institutional placement to raise A$450-million to develop the Kathleen Valley project.

The company will place 272.7-million shares, at A$1.65 each, representing a 14.1% discount to Liontown’s last closing price on November 30, and a 9.3% discount to its ten-day volume weighted average share price.

The shares will be placed under the company’s existing placement capacity, and no shareholder approval will be required.

“Following the successful completion of the equity raising, Liontown will be well capitalised, with certainty of funding for the Stage 1 Kathleen Valley development, putting us in an enviable position moving into 2022.”

“The board and management team believe it is prudent for Liontown to raise equity at this stage. Equity funding provides us with maximum flexibility with regard to offtake and pricing . . . while . . . retaining optionality to accelerate development or expansion to quickly take advantage of market opportunities that may arise. At the completion of the offer, we will . . . commence [the] ordering of long-lead items and secure our preferred contractors to ensure that we remain on schedule for first production in 2024,” MD and CEO Tony Ottavian has said.

In addition to the share placement, Liontown has also announced a share purchase plan (SPP) to raise up to A$40-million of additional funding.

Existing eligible shareholders will be given the opportunity to subscribe for up to A$30 000 worth of new shares in the company, also at A$1.65 a share. The SPP will close on January 14.

Funds raised will be used for the development of the Kathleen Valley project, as well as to fund the prefeasibility study on the downstream operation and further exploration work.

Key Contracts, Suppliers and Consultants
ZOOID (environmental social governance); Optiro (geology and mineral resources estimate); Snowden Mining Industry Consultants (mine optimisation, planning, design and scheduling); ALS Metallurgy (process testwork); Lycopodium Minerals (process and infrastructure design, capital and operating expenditure); Knight Piésold (tailings and hydrogeology); MBS Environmental (environmental studies); and Peter O’Bryan and Associates (geomechanical engineering).

Contact Details for Project Information
Liontown Resources, tel +6 8 6186 4600 or email info@ltresources.com.au.