Grounded Lithium Corp. (TSXV: GRD | OTCQB: GRDAF) has announced preliminary economic assessment (PEA) results on the first phase 11,000tpa of battery-grade lithium hydroxide monohydrate (LHM) production from its Kindersley Lithium Project.
They anticipate development of additional phases at Kindersley motivated largely by the compelling commercial merits of the economics of the PEA.
“The independent economic results of Phase 1 of the KLP compare favourably within the lithium mining industry from a CAPEX and OPEX perspective, and we believe the results of the PEA bode well for critical future steps, including securing strategic partnerships, off-take agreements, and capital formulation for a commercial project,” commented Gregg Smith, Grounded Lithium president and CEO.
“We now focus our corporate attention on the completion of a field pilot with Koch Technologies Solutions’ (KTS) extraction process, while at the same time undertaking certain field activities to provide higher certainty on our resources leading to a pre-feasibility study.”
This phase will generate an after-tax internal rate of return (IRR) of 48.5% using a realized sales price of US$25,000/t of LHM (flat for the duration of the model) and an after-tax US$1B net present value (NPV) at an 8% discount rate, on a capital investment of US$335M.
Payout of initial capital costs is only 3.7 years inclusive of lead time design and construction of 1.5 years. Grounded Lithium anticipates future project phases will be materially financed via internally generated cash flow.
An initial capital estimate of US$335M (including US$45M for contingencies) delivers a capital intensity of US$30,500/t of LHM for its initial 11,000tpa project, one of the lower capital intensities of North American lithium from brine projects.
All-in operating costs are anticipated to be US$3,899/t of LHM, or US$42.9M annually.
Only 24 of 300 sections of lithium rights will be developed in Phase 1 at Kindersley. The balance of the sections will support the development of subsequent phases and infrastructure investment is expected to underpin capital and operating cost efficiencies for all future phases.
For further information, please visit: www.groundedlithium.com
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