Atlantic Lithium posts final assay results from Ewoyaa drilling

Africa-focussed explorer Atlantic Lithium announced final assay results from the resource and exploration drilling programme completed at the Ewoyaa Lithium Project in Ghana on Thursday.

The AIM-traded firm said the final assay results had been received for a further 10,052 metres of exploration and infill diamond core and reverse circulation drilling completed at Ewoyaa as part of the now-completed resource evaluation and exploration programme.

It said the newly-reported results confirmed new mineralised pegmatites at the Grasscutter North, Kaampakrom North and Assan targets, outside the currently defined 30.1 million tonnes at 1.26% lithium oxide JORC 2012-compliant mineral resource estimate.

Multiple high-grade drill intersections were reported at the Kaampakrom North, Grasscutter North, Anokyi and Grasscutter West targets, including highlights of 36 metres at 1.23% lithium oxide from 42 metres at hole GRC0825, 22.2 metres at 1.62% lithium oxide from 73.3 metres on hole GDD0102A, and 20 metres at 1.6% lithium oxide from 44 metres in hole GRC0837.

Hole GDD0103, meanwhile, returned 15.1 metres at 1.24% lithium oxide from 55.4 metres, while hole GRC0842 returned 12 metres at 1.55% lithium oxide from 93 metres, and hole GRC0839 returned 13 metres at 1.35% lithium oxide from 99 metres.

The firm also highlighted 12 metres at 1.24% lithium oxide from 96 metres at hole GRC0850, 12 metres at 1.03% lithium oxide from 134 metres on hole GRC0341, seven metres at 1.69% lithium oxide from 162 metres in hole GRC0844, and eight metres at 1.48% lithium oxide from 34 metres at hole GRC0872.

All assay results had now been reported for the total approximate 47,000-metre completed drilling programme.

A resource upgrade was targeted for the first quarter, the board said, to inform the definitive feasibility study, which was targeted for completion in the middle of the year.

Atlantic Lithium also noted the recently-announced processing plant front-end engineering and design (FEED) contract awarded to Primero, to optimise the project's flow sheet, identify long-lead items, maximise its long-term profitability, reduce execution risk and ultimately support its advancement towards becoming a “financially and operationally robust” lithium-producing mine.

The recently-announced pre-feasibility study, meanwhile, delivered “exceptional” financial outcomes for a two-million-tonnes-per-annum operation, producing an average c. 255,000 tonnes of 6% lithium oxide spodumene concentrate (SC6) per year over a 12.5-year operation.

Life-of-mine revenues would exceed $4.84bn, while the post-tax 8%-discounted net present value (NPV8) was set at $1.33bn, and the internal rate of return at 224% over 12.5 years.

Capital costs were set to be $125m, with an “industry-leading” payback period of less than five months.

C1 cash operating costs, meanwhile, were set to be $278 per tonne of 6% lithium spodumene concentrate free-on-board at the Ghana port, after by-product credits.

Average life-of-mine EBITDA was set to be $248m per annum, while the maiden ore reserve was reported as 18.9 million tonnes at 1.24% lithium oxide, with average annualised pricing of $1,359 per dry metric tonne used.

“Drilling continues to deliver high-grade drill intersections outside the current mineral resource estimate,” said interim chief executive officer Lennard Kolff.

“This last batch of results has delivered multiple near-surface drill intersections in new pegmatites defined outside of the resource footprint at the Kaampakrom North and Grasscutter North targets including highlights of 36 metres at 1.23% lithium oxide from 42 metres, and 20 metres at 1.62% lithium oxide from 44 metres.

“Drilling has also returned high-grade, near-surface results at the Assan target approximately three kilometres north-east of the northern-most current pit design, including highlights of six metres at 1.49% lithium oxide from 66 metres, and six metres at 1.44% lithium oxide from 45 metres, demonstrating further potential within the mineralised pegmatite swarm.”

Kolff said the firm had now reported all assay results for the approximate=47,000m drilling programme, with a resource upgrade targeted for the first quarter, and a definitive feasibility study targeted for completion mid-2023.

“With the pre-feasibility study delivered, the mining licence application submitted, the FEED engineering contract awarded and the funding agreement with our partner Piedmont Lithium in place, we feel the company is ideally positioned to benefit from the ongoing lithium demand expected over the coming years.”

At 1102 GMT, shares in Atlantic Lithium were up 1.06% at 35.72p.

Reporting by Josh White for Sharecast.com.