TIDMILC
International Lithium Corporation
06 December 2018
NEWS RELEASE
International Lithium Announces Positive Preliminary Economic
Assessment Results for the Mariana Lithium Brine Project, Salta,
Argentina
Vancouver, B.C. December 6, 2018: International Lithium Corp.
(the "Company" or "ILC") (TSXV: ILC) is pleased to announce the
results of a Preliminary Economic Assessment ("PEA") for the
Mariana Lithium Brine Project located in the province of Salta,
Argentina.
PEA Highlights:
-- 25-year mine life producing 10,000 tonnes per year ("TPY")
Lithium Carbonate Equivalent ("LCE") plus 84,000 TPY Sulphate of
Potash ("SOP").
-- The estimated CAPEX and OPEX are for a conventional brine
extraction facility, solar evaporation ponds and SOP processing
with a level of accuracy of -30/+50%.
-- CAPEX estimated at US $243 million for 25-year mine life.
-- NPV = US $192 million after-tax at 10% discount rate, IRR = 20% post-tax.
-- Project results remain positive, even with important negative
variations on the driver variables, indicating project strength and
resilience; thus, the PEA study indicates Mariana's proposed 10,000
TPY LCE concentrated brine and 84,000 TPY SOP fertilizer operation
has the potential to generate strong economic returns.
The PEA was prepared by Advisian ("Advisian"), a division of the
WorleyParsons Group, for Mariana Lithium Corp. to provide a PEA of
its Mariana Lithium Brine Project in accordance with National
Instrument 43-101 - Standards of Disclosure for Mineral Projects
("NI 43-101"). The PEA technical report assesses the potential
economic viability of developing the 14 exploration licenses
(Minas), that cover the Salar de Llullaillaco (the Salar) and
surrounding area (23,560 hectares), for the purpose of extraction
of lithium brine resources and processing of two products - Lithium
Carbonate Equivalent and Sulphate of Potash. All figures are quoted
in US dollars. It should be noted that the Company did not play any
significant part in the production of the PEA report, and that the
conclusions are therefore those of the consultants.
Cautionary Note:
The preliminary economic assessment (PEA) is preliminary in
nature, and it includes inferred mineral resources that are
considered too speculative geologically to have the economic
considerations applied to them that would enable them to be
categorized as mineral reserves, and there is no certainty that the
preliminary economic assessment will be realized. The PEA includes
the results of an economic analysis of mineral resources, and
mineral resources that are not mineral reserves do not have
demonstrated economic viability.
Current ownership of the Mariana Project is through a joint
venture company, Litio Minera Argentina S. A., a private company
registered in Argentina, owned 82.754% by Ganfeng Lithium through
its wholly-owned subsidiary, Mariana Litihium Corp. and 17.246% by
ILC. In addition, ILC has an option to acquire another 10% in the
Mariana Project through a back-in right.
John Wisbey, Chairman and CEO of the Company said, "It is good
finally to have received this Preliminary Economic Assessment (PEA)
showing a post-tax NPV for Mariana of over US $190 million (over
CAD $250 million at current exchange rates) with net annual
cashflows of US $96 million after production starts. It is
significant how much the high concentration of Sulphate of Potash
is worth to the project, which is a large credit on top of the
lithium revenues. Our present share in Mariana is 17.246% and it
would rise to 27.246% if we exercised our back-in right which would
currently cost us about CAD $7 million. It should be noted that the
conclusions of the PEA were prepared by Advisian based on work
carried out by the project managers. The cutoff for data supporting
the PEA is March 31, 2018. The process methodology is based on the
assumption that conventional brine extraction and evaporation
methods will be the only method used for the production of lithium
and potassium compounds at Mariana. 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 tonnes
of indicated resource and the 618,000 tonnes 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."
Preliminary Economic Analysis
The economic analysis of the Mariana Lithium Project (the
"Project") is based on an operating capacity of 40,150 TPY of 4.7%
lithium concentration brine and production of 84,000 TPY of SOP
fertilizer product.
To perform the Project's economic evaluation, Advisian used a
discounted cash flow (DCF) financial model with a 10% discount
rate. Capital and operating costs estimates are as shown in the
following sections. Other main inputs for this model are an assumed
ramp up and production
program, and a market and pricing forecast included below.
Results of the model comprise the Project's NPV and IRR. Table 1
presents the Project's base
case economic analysis results.
Table 1: Economic Evaluation - Base Case Summary.
Description Units LCE SOP Total
Production tpy 10,000 84,000
Mine Life years 25
======== =========== ========== ============
Capital Cost (CAPEX) US$ 243,425,000
======== =========== ========== ============
Operating Cost (OPEX) US$ 46,666,000
======== =========== ========== ============
Lithium Carbonate Refining US$/t 2,900 N/A
Cost
======== =========== ========== ============
Average Selling Price US$/t 9,683 550
======== =========== ========== ============
Annual Revenue US$ 96,830,000 46,200,000 143,030,000
======== =========== ========== ============
Discount Rate % 10%
======== =========== ========== ============
Net Present Value (NPV) Pre-Tax US$ 288,017,000
======== =========== ========== ============
Internal Rate of Return (IRR)
Pre-Tax % 23.7
======== =========== ========== ============
Net Present Value (NPV) Post-Tax US$ 191,670,000
======== =========== ========== ============
Internal Rate of Return (IRR)
Post-Tax % 20.0
======== =========== ========== ============
Capital and Operating Costs
Capital expenditures are based on an operating capacity of
40,150 TPY of 4.7% lithium concentrated brine and production of
84,000 TPY of SOP fertilizer product. Capital equipment costs were
obtained from in-house data and solicited budget price information.
The estimate is compliant to AACE Class 5 standard. Accuracy of
this estimate is expected to be within a -30% / +50% range.
Table 2: CAPEX Summary.
Area Code & Name Cost US$
1000 Brine Field 24,428,000
2000 Evaporation Ponds 87,547,000
========================
3000 SOP Process Plant 41,742,000
========================
4000 On Site Infrastructure & Auxiliaries 6,888,000
========================
5000 Tailings Management Area (TMA) 4,617,000
========================
6000 Lithium Carbonate Plant N/A
========================
7000 Off-Site Infrastructure 22,316,000
========================
Direct Cost Sub-Total 187,538,000
========================
8000 Owner's & Misc. Indirect Costs 18,754,000
========================
9000 EPCM Services 15,003,000
========================
Indirect Cost Sub-Total 33,757,000
========================
Total Cost (Direct +Indirect) 221,295,000
========================
Contingency (10%) 22,130,500
========================
TOTAL 243,425,000
========================
Table 3: Annual Operating Cost Summary.
Item Description Cost (US$)
1 Manpower 2,052,000
2 Electrical Power 12,023,000
======================================= ========================
3 Reagents, Fuel & Consumables 14,715,000
======================================= ========================
4 Ponds Harvesting & TMA Operation 5,954,000
======================================= ========================
5 Water 531,000
======================================= ========================
6 Camp Operations & Personnel Transport 1,084,000
======================================= ========================
7 Sustaining Capital Cost 3,808,000
======================================= ========================
8 Product Transportation 3,966,000
======================================= ========================
9 Miscellaneous Direct Expenditures 662,000
======================================= ========================
10 Sub-Total 44,134,000
======================================= ========================
11 Indirect Operational Expenditures 1,870,000
======================================= ========================
TOTAL 46,666,000
======================================= ========================
Summary and Conclusions
-- The technical solutions included in the PEA technical report
are standard, time proven designs for main operating facilities.
This approach provides a solid, workable base case to which other
design alternatives can be related and compared.
-- Advisian has estimated CAPEX and OPEX for a conventional
brine extraction facility, solar evaporation ponds and SOP
processing with a level of accuracy of -30/+50%, including
equipment, materials, indirect costs and contingencies during the
construction period, is estimated to be US $243.4 million.
-- The Project economic analysis indicates that, for the base
case, the After Tax (AT) NPV (10%) is US $191.7 million and IRR is
20.0%.
-- Project results remain positive, even with important negative
variations on the driver variables, indicating project strength and
resilience; thus, the PEA study completed by Advisian indicates the
Project's proposed 10,000 TPY LCE concentrated brine and 84,000 TPY
SOP fertilizer operation has the potential to generate strong
economic returns.
An NI 43-101 technical report is required to be filed, in
conjunction with the disclosure of the PEA in this news release,
within 45 days.
Afzaal Pirzada, P. Geo., a Qualified Person as defined by NI
43-101 and a consultant to the Company, has reviewed and approved
the all disclosure of scientific or technical information in this
news release.
About International Lithium Corp.
International Lithium Corp. has a significant portfolio of
projects, strong management, and a strategic partner and key
investor, Jiangxi Ganfeng Lithium Co. Ltd., ("Ganfeng Lithium") a
leading China-based lithium product manufacturer.
The Company's primary strategic focus is now on the Mariana
project in Argentina and on the Raleigh Lake project in Canada.
The Company has a strategic stake in the Mariana lithium-potash
brine project located within the renowned South American "Lithium
Belt" that is the host to the vast majority of global lithium
resources, reserves and production. The Mariana project
strategically encompasses an entire mineral rich evaporite basin,
totalling 160 square kilometres that ranks as one of the more
prospective salars or 'salt lakes' in the region. Current ownership
of the project is through a joint venture company, Litio Minera
Argentina S. A., a private company registered in Argentina, owned
82.754% by Ganfeng Lithium and 17.246% by ILC. In addition, ILC has
an option to acquire 10% in the Mariana project through a back-in
right.
The Raleigh Lake project, now consisting of 3,027 hectares of
adjoining mineral claims in Ontario, is now regarded by ILC
management as ILC's most significant project in Canada. It is 100%
owned by ILC, is not subject to any encumbrances, and is royalty
free.
Complementing the Company's lithium brine project at Mariana and
rare metal pegmatite property at Raleigh Lake, are interests in two
other rare metal pegmatite properties in Ontario, Canada known as
the Mavis Lake and Forgan Lake projects, and the Avalonia project
in Ireland, which encompasses an extensive 50-km-long pegmatite
belt.
The ownership of the Mavis Lake project is now 51% Pioneer
Resources Limited (ASX:PIO, "Pioneer") and 49% ILC. In addition,
ILC owns a 1.5% NSR on Mavis Lake. Pioneer has an option to earn an
additional 29% by sole-funding a further CAD $8.5 million
expenditures of exploration activities, at which time the ownership
will be 80% Pioneer and 20% ILC.
The Forgan Lake project will, upon Ultra Lithium meeting its
contractual requirements pursuant to its agreement with ILC, become
100% owned by Ultra Lithium (TSXV: ULI), and ILC will retain a 1.5%
NSR on Forgan Lake.
The ownership of the Avalonia project is currently 55% Ganfeng
Lithum and 45% ILC. Ganfeng Lithium has an option to earn an
additional 24% by either incurring CAD $10 million expenditures on
exploration activities or delivering a positive feasibility study
on the project, at which time the ownership will be 79% Ganfeng
Lithum and 21% ILC.
With the increasing demand for high tech rechargeable batteries
used in electric vehicles and electrical storage as well as
portable electronics, lithium has been designated "the new oil",
and is a key part of a "green tech", sustainable economy. By
positioning itself with solid strategic partners and projects with
significant resource potential, ILC aims to be one of the lithium
and battery metals resource developers of choice for investors and
to continue to build value for its shareholders.
International Lithium Corp.'s mission is to find, explore and
develop projects that have the potential to become world class
lithium, potash and rare metal deposits. A key goal is to become a
well funded company to turn that aspiration into reality.
On behalf of the Company,
John Wisbey
Chairman and CEO
www.internationallithium.com
For further information concerning this news release please
contact +1 604-449-6520
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Cautionary Statement Regarding Forward-Looking Information
Except for statements of historical fact, this news release
contains certain "forward-looking information" within the meaning
of applicable securities law. Forward-looking information or
forward-looking statements in this or other news releases may
include: the effect of results of the preliminary economic
assessment of the Mariana Joint Venture Project, timing of
publication of the PEA technical report, anticipated production
rates, the timing and/or anticipated results of drilling on the
Raleigh Lake or Mavis Lake projects, the expectation of feasibility
studies, lithium recoveries, modeling of capital and operating
costs, results of studies utilizing membrane technology at the
Mariana Project, budgeted expenditures and planned exploration work
on the Avalonia Joint Venture, satisfactory completion of the sale
of mineral rights at Forgan Lake, satisfactory completion of the
purchase of additional mineral rights at Raleigh Lake, increased
value of shareholder investments, and continued agreement between
the Company and Jiangxi Ganfeng Lithium Co. Ltd. regarding the
Company's percentage interest in the Mariana project. Such
forward-looking information is based on a number of assumptions and
subject to a variety of risks and uncertainties, including but not
limited to those discussed in the sections entitled "Risks" and
"Forward-Looking Statements" in the interim and annual Management's
Discussion and Analysis which are available at www.sedar.com. While
management believes that the assumptions made are reasonable, there
can be no assurance that forward-looking statements will prove to
be accurate. Should one or more of the risks, uncertainties or
other factors materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those described
in forward-looking information. Forward-looking information herein,
and all subsequent written and oral forward-looking information are
based on expectations, estimates and opinions of management on the
dates they are made that, while considered reasonable by the
Company as of the time of such statements, are subject to
significant business, economic and competitive uncertainties and
contingencies. These estimates and assumptions may prove to be
incorrect and are expressly qualified in their entirety by this
cautionary statement. Except as required by law, the Company
assumes no obligation to update forward-looking information should
circumstances or management's estimates or opinions change.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
NRAFMMGZZVFGRZM
(END) Dow Jones Newswires
December 06, 2018 09:30 ET (14:30 GMT)
International Lithium (LSE:0V1I)
Historical Stock Chart
From Oct 2024 to Nov 2024
International Lithium (LSE:0V1I)
Historical Stock Chart
From Nov 2023 to Nov 2024
