Name of the Project
Mina do Barosso lithium project.

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

Client
Savannah Resources.

Project Description
A scoping study has confirmed that Mina do Barosso 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 (Li2O), 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% Li2O.

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.

Value
Initial capital expenditure is estimated at $109-million.

Duration
Construction is expected to start in the second quarter of 2019, with production expected to start in the first quarter of 2020.

Latest Developments
Savannah Resources has successfully produced saleable quartz and feldspar co-products from its ongoing metallurgical testwork at the project.

Co-products will be produced from further processing of the tailings material from the spodumene concentration process.

Initial indications are that the following three products can be produced: feldspar (Na2O+K2O+Li2O grades >12%), with a potential price range of $65/t to $100/t, quartz (99.6% pure), with a potential price range of $60/t to $100/t and bulk tail (Na2O+K2O+Li2O grades >7%), with a potential price range of $40/t to $45/t.

Savannah has noted that the potential pricing of the by-products is significantly higher than those values used in the recent scoping study of $39/t for feldspar and $33/t for quartz.

Testwork for co-product and specifications has been independently evaluated and confirmed by First Test Minerals.

Savannah has said that preliminary offtake discussions are under way with a number of potential parties.

The company has also highlighted a significant environmental benefit from the sale of co-products, reducing the potential size of the footprint of any potential operation.

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.