Name and Location
Pilgangoora lithium project, Pilbara, Australia.

Client
Altura Mining.

Project Description
Altura’s 100%-owned Pilgangoora project comprises a series of spodumene-bearing pegmatites. The area has been extensively explored in the past for a wide variety of minerals, including tin, tantalum, base metals, nickel and gold. A feasibility study completed on the project has shown superior outcomes to those of the mining study on the project in almost every area. It is based on an ore feed of about 1.4-million tonnes a year to the process plant to deliver average output, at steady state, of 215 000 t/y of spodumene concentrate containing 6% lithium oxide. This is an increase from the 150 000 t/y estimated in the mining study.

The current life-of-mine (LoM) plan is based on direct feed of ore to the process plant from Years 1 to 12 while building a low-grade stockpile. Material from the low-grade stockpile will be fed to the process plant in Years 12 to 14. The LoM production target of 18.47-million tonnes consists entirely of probable ore reserves estimated at 18.4-million tonnes.

Mining will be undertaken using a staged approach, starting with a smaller pit mined at the northern limit of the deposit (Stage 1), advancing to the south in seven stages to reach the ultimate designed pit.

Conventional bulk mining methods using hydraulic excavators, dump trucks and drill and blast coupled to a run-of-mine (RoM) stockpile will be used.

Ore will be trucked directly from the blasted faces to the RoM stockpile and fed to the primary crusher using a front-end loader.

Allowance has been made for blending from the RoM and external stockpiles.

The process plant has been designed to process 1.4-million tonnes of Pilgangoora lithium ore, beneficiating RoM ore to a 6.5% lithium concentrate. The plant will create a coarse and fine concentrate using industry-standard separation techniques for hard-rock spodumene production from a pegmatite orebody. A tailings storage facility (TSF) is required to accommodate fine tailings from the process plant and facilitate the recovery of process water. The mine will produce 420 000 tonnes of fines tailings a year over 14 years, based on an indicated and inferred resource of 35.7-million tonnes.

Concentrate will be exported by ship from Port Hedland to lithium producers, pre-dominantly in China, for further processing into a wide range of lithium chemicals, including lithium carbonate (standard and battery grade), lithium hydroxide, lithium metal and lithium chloride.

Net Present Value/Internal Rate of Return
The feasibility study has indicated a net present value (NPV), at a 10% discount rate, of A$382-million from an NPV of A$277-million in the mining study. The project’s internal rate of return (IRR) has increased from 42.5% to 59.5%. Payback has decreased from 2.3 year to 1.7 years, compared with the mining study.

Value
The project has a capital estimate of A$129.26-million.

Duration
Production is planned for the third quarter of 2017, following a nine-month construction period.

Latest Developments
A definitive feasibility study on the project is expected to be delivered in the third quarter of 2017.

Meanwhile, Altura Mining has signed its first binding offtake agreement for the Pilgangoora lithium project with China’s Lionenergy.

The offtake agreement follows an earlier letter of intent under which the Chinese firm agreed to buy between 100 000 t/y and 150 000 t/y of lithium spodumene concentrate from the project.

Under the terms of the offtake agreement, Lionenergy will take a minimum of 100 000 t/y of spodumene concentrate for an initial five-year period, with any extensions to this date to be negotiated between the two companies. The companies will also negotiate any additional offtake tonnage in excess of
the 100 000 t/y.

The spodumene concentrate pricing will be based on the prevailing US dollar market price, and will be negotiated between Altura and Lionenergy.

The offtake agreement is based on the start of mining at Pilgangoora, within two years of the binding offtake agreement, and Altura obtaining finance for the development of the project within six months of the signing date.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Too early to state.

Contact Details for Project Information
Altura Mining, tel +61 8 9488 5100, fax +61 8 9488 5199 or email cosec@alturamining.com.