Savannah Resources PLC (LON:SAV) told investors it is making excellent progress towards a long-term offtake deal, for the spodumene concentrate that will be produced at the Mina do Barroso lithium project in Portugal.
“The company is intent not only on building a sustainable, low carbon footprint project but also in forging strong European partnerships and alignments to support the development of Mina do Barroso,” chairman Mathew King said, in a statement ahead of today’s AGM.
Whilst noting challenges presented by the coronavirus pandemic, and the company’s cash conserving responses, King also highlighted an important recent milestone for Mina do Barroso – the submission of a complete Environmental Impact Study (EIA) and mine plan at the end of May.
King said that the completion of a feasibility study, slated for the first half of 2021, will synchronise the mine with the anticipated lithium hydroxide refinery developments in Europe.
Securing an offtake deal in this arena is among management’s priorities, along with project financing and mine permitting.
“We are pleased that the EIA presents a comprehensive body of fact-based evidence which shows that Mina do Barroso can be a 'low impact' project, minimising disturbance to both the natural environment and local communities, while also maximising the very significant socio-economic benefits the project can bring to the local area and Portugal as a whole,” King added.
“The significance of Mina do Barroso to Europe's new lithium battery value chain was also reinforced by the agreement secured with EIT InnoEnergy at the end of May 2020.”
Savannah noted that it had appointed WH Ireland to its brokerage team, replacing Whitman Howard, and joining existing joint-broker finnCap.
"Much pessimism abounds regarding the general prospects for the world's economies in the short to medium term,” King said.
“Nonetheless, there are good reasons for believing the coronavirus pandemic will give a boost to the prospects for sustainable energy sources from which suppliers of lithium should benefit.
“At the same time, the potential for dislocation to inter-continental supply chains has demonstrated the importance for Europe in developing a regional lithium battery value chain. Your Board is looking to ensure our shareholders are well-placed, through Mina do Barroso, to benefit from these trends.