ASX-listed Birimian has completed an updated pre-feasibility study and declaration of a maiden ore reserve for its wholly-owned Goulamina lithium project in southern Mali.
Mali – The results of the pre-feasibility study (PFS) demonstrate excellent project economics, including a pre-tax NPV of A$920 million (US$690 million) and pre-tax IRR (real) of 49.5%, and significant potential for further upside.
The PFS confirms that Goulamina can be profitably developed as a large scale, low cost, hard rock lithium mine. The recommended development scenario comprises an open cut mining operation and a 2 Mtpa mineral concentrating plant with an initial mine life of 16 years.
Birimian executive director and CEO Greg Walker described the release of the PFS results and maiden Ore Reserve as an “exceptional achievement” for Birimian.
“The outstanding financial projections for the project, together with the high-grade deposits amenable to low-cost and straightforward mining, establishes Goulamina as an exceptional lithium project of global significance.
“The declaration of a maiden ore reserve is a major milestone for Birimian. The fact that the company has been able to announce a substantial ore reserve of more than 31 Mt – sufficient to support mining operations at 2 Mtpa for an initial 16 years - and at a high grade of 1.56% Li2O - is indicative of the outstanding quality of the project.
“Birimian looks forward to rapidly advancing Goulamina towards development, while further expanding the project’s mineral resources.
“I am particularly pleased that the objectives we set for this PFS process have been so successfully achieved. Our ability to satisfy the long-term requirements of strategic offtake partners is now well demonstrated” says Walker.
Key highlights of the PFS at a glance
- Goulamina can be profitably developed as a large scale, low cost hard rock lithium mine and the PFS recommends progression to a feasibility study;
- Annual concentrate production of 362 000 tpa (of 6% Li2O spodumene concentrate)
- Strong financial outcomes forecast including pre-tax NPV of A$920 million and pre-tax IRR (real) of 49.5%;
- LOM project EBITDA (real) of A$2.691 million (or US$2.018 million), which translates to average annual EBITDA of $171 million (or US$128 million)
- LOM net cash flow from operations (pre-tax, real) of A$2.359 million (or US$1.769 million), which translates to average annual net cash flow from operations of $150 million (or US$112 million)
- Maiden ore reserve of 31.2 Mt at 1.56% Li2O defined, derived only from indicated mineral resource of 43.7 Mt at 1.48% Li2O supports an initial 16-year operating life at 2 Mtpa.
- Long mine life with strong potential for extension through exploration upside and conversion of inferred mineral resources
- Average LOM operating cash cost (Brook Hunt C1) of A$374/t (or US$281/t)
- Short payback period of 2.6 years, including production ramp-up period.
The PFS follows an earlier Goulamina pre-feasibility study released in October 2017. Subsequently, the Birimian advised that it would undertake further work to produce an updated PFS with a firm development recommendation, based on improved project economics.
The financial model is based on revenues derived from sales of a combined dense media separation and flotation concentrate. It is assumed that all concentrate will be 100% payable and priced on a contractual basis with the average real price achieved over the life of mine anticipated to be A$888/t (US$666/t) FOB Abidjan.
2018 work programme
Birimian intends undertaking infill and extension drilling later this year aimed at increasing the project’s ore reserves and will also carry out further resource extension and definition drilling of the Company’s other identified pegmatite systems at Goulamina. Birimian is confident that it can achieve significant increases to the project’s current mineral resource base.