Lithium developer Sayona Mining (ASX: SYA) on Friday announced a $136-million institutional placement to fund the 2023 restart of its North American Lithium (NAL) operations.
“The planned restart at NAL remains on schedule for first spodumene concentrate production in Q1 2023, with critical long‐lead items secured and senior staff recruited. NAL concentrator commissioning is projected for late Q3/early Q4 2022,” said the company.
The company published a positive prefeasibility study for the project this week, confirming the NAL operation’s technical and financial viability over a 27-year mine life.
Sayona holds a 75% interest in NAL, with Piedmont Lithium (ASX: PLL) holding 25%. They acquired the NAL project in August 2021, after its previous owner sought creditor protection and suspended the operation, which consisted of an open pit spodumene mine and concentrator located in La Corne.
As part of its plans to create a lithium mining hub in the Abitibi region of Quebec, Sayona aims to restore operations at NAL and integrate it with its wholly owned Authier project, which had already reached the feasibility stage and will provide supplementary ore feed to NAL.
The restart of the NAL operation would allow Sayona to launch production ahead of other North American projects, generating sustainable cash flows and putting the company on a fast track to go downstream into value‐added lithium hydroxide or carbonate production, it said.
The recent prefeasibility for NAL confirmed potential for this Abitibi lithium hub, adding to the company’s emerging northern Quebec hub and facilitating downstream processing, solidifying what would be North America’s largest lithium (spodumene) resource base. As shown in the study, NAL’s after-tax net present value (NPV) was estimated at approximately $751 million (at an 8% discount), with an internal rate of return (IRR) of 139% and a capital payback period of about two years.
Capital costs amounted to $91 million, with upgrades to improve operational efficiency, grade, quality and recovery. Long‐lead equipment has already been ordered to facilitate a restart in the first quarter of 2023.
The project economics were based on proved and probable ore reserves (JORC compliant) of 29.2 million tonnes averaging 0.96% lithium oxide (Li2O). Along with an upgraded ore reserve, the concentrator mill throughput has increased to 4,200 tonnes per day from 3,800 tonnes per day since the acquisition in 2021, producing a 6% Li2O spodumene concentrate.
Shares of Piedmont rose 5% by Friday morning. Shares of Sayona rose 2.4%; The company has a market value of $1.1 billion.
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