Avalon Advanced Materials‘ (TSX: AVL; US-OTC: AVLNF) shares rose by more than 10% Thursday after the company released an update for its Separation Rapids lithium project that saw resources grow by 20%.
The update for the Avalon-Sibelco joint venture project in northwestern Ontario puts the measured and indicated resource at 10.1 million tonnes grading 1.35% lithium oxide (Li2O), a 20% rise over previous results in 2018.
Highlights of the update also include open pit measured and indicated resources of 9.4 million tonnes averaging 1.34% Li2O, with the start of an underground resource of 680,000 tonnes averaging 1.43% Li2O. The inferred category has increased by 57% in size, with 2.8 million tonnes averaging 1.38% Li2O for the project, located about 70 km north of Kenora.
“This updated estimate reveals the quality and quantity of the resource at Separation Rapids, and
underscores the rationale for the strategic partnership between Avalon and Sibelco,” said Avalon CEO Scott Monteith, about the partnership with Antwerp, Belgium-based-SCR-Sibelco NV. “It confirms that the deposit can deliver sufficient volumes of commercial-grade feedstock suitable for both the glass ceramics and lithium battery markets.”
The report also notes an exploration potential of an additional 3 million tonnes to 6 million tonnes of resource, grading between 1 and 1.4% Li2O which could relate to an increase in Li2O by 30,000 to 80,000 tonnes.
Monteith added that the update gives the JV the confidence to push towards a feasibility study and then production at Separation Rapids, though he didn’t specify a timeline.
The resource increase comes almost one year after Avalon began work on a demonstration dense media separation plant for the Separation Rapids project.
Avalon shares traded at 15¢ apiece in Toronto on Thursday afternoon, valuing the company at $86.7 million. Its shares traded in a 52-week window of 9¢ and 18¢.
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