Core Lithium Ltd is a big step closer to becoming Australia’s next lithium producer after completing a positive definitive feasibility study (DFS) and two scoping studies for its flagship Finniss Lithium Project in the Northern Territory.
The ASX-listed resources company has today unveiled its stage one DFS, an extension scoping study and a lithium fines scoping study, all of which outline the economic and producing potential of Australia’s most advanced new lithium mining project.
Looking ahead, Core managing director Stephen Biggins said: “With the updated DFS now completed, we aim to finalise funding over the coming months to allow Core to make a final investment decision in 2021 and fast-track construction.”
Overall, the studies outline a near-term pathway to an initial 10-year mine life at Finniss, which lies just 88 kilometres from Australia’s closest port to China in a tier-one, low-risk mining jurisdiction.
Finniss is now considered one of the world’s most capital-efficient lithium mining projects.
Definitive feasibility study
Finniss’ DFS positions the project to turn out 7.4 million tonnes of resource at 1.3% lithium oxide over an eight-year mine life, with a 173,000-tonne-per-annum production rate, grading 5.8% lithium oxide.
The lithium play’s start-up capital costs are estimated at A$89 million while operating costs are calculated to land around US$364 per tonne. First production is slated for next year.
The DFS outlines a 30% increase in ore reserves to 7.4 million tonnes at 1.3% Li2O prepared using the JORC Code 2012, underpinning an 8-year Life of Mine (LOM), with additional mineral resource inventory to potentially further increase LOM.
Owing to this reserve, Finniss boasts a A$221 million pre-tax net present value and a 53% pre-tax internal rate of return.
Key metrics from Core’s Stage 1 DFS.
Speaking on the DFS, Biggins said: “The study highlights the project’s attractive combination of high-grade ore reserves, simple DMS processing producing a high-quality concentrate, and proximity to nearby existing infrastructure including the Port of Darwin.
“We are also maintaining our exploration momentum, with the aim to more than double the mine life and resources of the project.
“On behalf of the Core board, I would like to thank our management team and valued partners who have been involved in preparing the DFS. We look forward to an exciting future as we move toward commencing construction of Stage 1 of the Finniss Project.”
MD Biggins spoke to Andrew Scott in May about Finniss' development.
Core’s extension scoping study considers a two-year life of mine extension when Finniss’ inferred resources at the Grants, BP33, Carlton and Hang Gong prospects are taken into account.
This increases the project’s ore inventory by more than two million ounces and boosts the estimated concentrate production by roughly 350,000 tonnes.
Despite this large jump, Finniss’ operating costs only increase by US$8 per tonne, while start-up capital remains unchanged.
How the extension scoping study compares to the DFS findings.
More broadly, mining in these regions has the potential to support a Stage 2 expansion at Finniss, adding to the project’s exploration upside.
As a result, Core has established a “substantial” drilling budget for 2021 and 2022 as it targets a final investment decision before year’s end.
In addition, Core worked with Primero Group to establish a standalone lithium fines scoping study, which shows there is potential to reduce Finniss’ tailings stream and waste impact.
This indicates the ASX-lister could potentially produce and sell around 110,000 tonnes of lithium fines every year, grading at around 1.0% lithium oxide, with no incremental mining activities required.
Core has already received non-binding interest expressions from potential offtake partners for the lithium fines by-product, with indicative pricing between US$75 and US$85 per tonne.
Key findings from the lithium fines scoping study.
Beyond that, the ASX-lister hopes to start Stage 1 construction and ramp-up to commercial production next year as it progresses resource drilling within its Stage 2 expansion phase.
The next few years of development at Finniss.