The Mariana lithium brine joint venture (JV) project between China’s Ganfeng Lithium and Canadian junior International Lithium has the potential to produce 10 000 t/y of lithium carbonate equivalent (LCE) and 84 000 t/y of sulphate of potash (SOP), a preliminary economic assessment (PEA) has found.
The mine is located in the province of Salta, Argentina, and will operate for 25 years.
The PEA estimates that the JV will have to invest $243-million to build the mine and determined that the LCE and SOP operation will generate strong economic returns,
At a 10% discount rate, the Mariana project has net present value of $192-million and an internal rate of return of 20%, after tax.
“It is our belief that additional value can be created for the project by use of appropriate membrane technology onsite in Argentina, and we will be supportive of initiatives to use this method to complement the current plans for evaporation. Additionally, we are hopeful that the estimate of 10 000 tonnes per annum of production and a 25-year mine life are on the conservative side, given the 1 248 000 t of indicated resource and the 618 000 t of inferred resource reported in 2016. Nevertheless, these solid numbers in the PEA give us great encouragement that Mariana has been worth investing in and that, provided that Ganfeng and we can together finance the project appropriately, it is capable of delivering a significant return to our shareholders,” commented International Lithium chairperson and CEO John Wisbey.
Ganfeng owns 82.754% in the JV and International Lithium 17.246%, although the junior could increase its interest by a further 10% through a back-in right, which will cost it C$7-million.
The PEA was prepared by Advisian, a division of the WorleyParsons Group.