European Metals Holdings pleased with update to Cinovec project economics

European Metals Holdings announce the results from the update of the process flowsheet previously developed to enable the production of lithium hydroxide on Monday, explaining that the work was completed in conjunction with test work confirming the production of battery grade lithium hydroxide from Cinovec ore.

The AIM-traded firm said the results “significantly” enhanced the forecast economics of the Cinovec project.

It said the net estimated overall cost of production post credits was now $3,435 per tonne of lithium hydroxide, with the project’s net present value increasing 105% to $1.108bn post tax.

The internal rate of return had increased 37% to 28.8% post tax, while the total capital cost now stood at $482.6m.

Annual production of battery grade lithium hydroxide was estimated to reach 25,267 tonnes.

European Metals Holdings said the studies were based on just 9.3% of reported indicated mineral resource and a mine life of 21 years, processing an average of 1.68 Mtpa ore.

It said the process used to produce lithium hydroxide allowed for the staging of lithium carbonate and lithium hydroxide production, to minimise capital and startup risk, and enabled the production of either battery grade lithium hydroxide or carbonate as markets demanded.

“I am very pleased to report to shareholders on the completion of this update to our 2017 preliminary feasibility study for the Cinovec project which adds significantly to the already robust forecast economics for the project,” said the company’s managing director Keith Coughlan.

“Since demonstrating that battery grade lithium hydroxide can be produced from zinnwaldite mineralisation we have worked with Hatch to update the flowsheet and engineering required to adapt our lithium carbonate producing flowsheet to one that converts battery grade lithium carbonate into lithium hydroxide.

“We have now confirmed the ability with our resource, which is the largest lithium resource in Europe, to produce either or both products in line with market requirements once in production.”

Coughlan noted that Cinovec was “strategically located” in central Europe, in close proximity to the continent's vehicle manufacturers.

“With increasing demand for electric vehicles and the expected demands of grid storage capacity, the project is very well placed to supply the European lithium market for many decades.”