REG - Atlantic Lithium Ltd - Project Development Update

Atlantic LithiumAnnouncement

22/11/2023 07:15

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RNS Number : 2151U  Atlantic Lithium Limited  22 November 2023

 

 22 November 2023

Project Development Update

Atlantic Lithium takes major strides in the development of the Ewoyaa Lithium Project,

targeting the commencement of construction in late 2024 and initial production in early 2025

Atlantic Lithium Limited (AIM: ALL, ASX: A11, OTCQX: ALLIF, "Atlantic Lithium"
or the "Company"), the African-focused lithium exploration and development
company targeting to deliver Ghana's first lithium mine, is pleased to provide
the following progress update with regards to the development of the Company's
flagship Ewoyaa Lithium Project ("Ewoyaa" or the "Project") in Ghana, West
Africa.

Highlights

-    Bulk Customer Permit awarded in respect of the electricity requirements
of the Company's Ewoyaa Lithium Project, expected to deliver a 30-50% overall
power cost reduction for the Project.

 

-       Key contracts on the critical path for the Project progressing,
including:

·      Advanced discussions ongoing for the award of the Engineering,
Procurement, Construction and Management ("EPCM") contract for the main
processing plant and all non-processing infrastructure;

·      Tender stage underway to appoint a mining contractor and for the
procurement of the modular Dense Media Separation ("DMS") unit, respectively;

·      Tender stage to commence imminently for the procurement of the
mobile crusher to feed the modular DMS unit; and

·      Award of the contract to divert the transmission lines crossing the
Project site expected in Q2 2024.

 

-       Completion of the Flotation Scoping Study; results confirm the
viability of the inclusion of a downstream flotation circuit at Ewoyaa for
future value addition.

 

-       Maiden feldspar Mineral Resource Estimate expected in Q4 2023; in
line with the Feldspar Study underway to evaluate the viability of the
production of feldspar as a by-product of spodumene production at the Project.

 

-    Work underway with Engineering Procurement and Construction firm
Mincore to assess the potential to establish a downstream lithium conversion
plant in Ghana, as agreed under the terms of the grant of the Mining Lease for
the Project.

 

-       Appointment of three General Managers, including General Manager,
Operations, as the Company steps up recruitment to strengthen its leadership
team, with a focus on mine build and operating experience, as it transitions
from explorer and developer to producer.

 

Commenting on the Company's latest progress, Keith Muller, Chief Executive
Officer of Atlantic Lithium, said:

"Following the grant of the Mining Lease in October 2023, we are now firmly on
the path towards building Ewoyaa as Ghana's first lithium mine. Alongside our
ongoing, recently extended exploration programmes, which continue to add value
to the Project, excellent progress is being made towards achieving shovel
readiness.

"The permitting phase is well underway, with active engagement with local
stakeholders within and surrounding the Project's Lease Area. In October, we
held the inaugural Community Consultative Committee meeting, whereby we
welcomed the open discussion of how the Project can benefit the local
community. Ever since the Company began operating in Ghana, the local
population has shown incredible backing for the Project, and this continues
even as we near construction.

"As anticipated, the results of the Flotation Scoping Study support the
viability of processing both the fines and the middlings materials through
flotation, as well as the potential to achieve significantly enhanced recovery
of the P2 finer-grained pegmatite material. The results firmly confirm the
Company's case for the inclusion of a flotation circuit, which will operate
independently and downstream from the main DMS plant. Construction and
integration of the circuit will be carried out post the main processing plant
achieving steady state 2.7Mt annualised throughput.

"In line with the terms agreed under the grant of the Mining Lease, work on
both the feldspar and downstream conversion studies is progressing at pace.
Concurrently, discussions are underway with a number of parties with regards
to commercial contracts that are critical to the development of the Project,
with updates expected on each of these over the coming months.

"Being now within only two years from initial production, the Company
continues to actively recruit experienced individuals to bolster the expertise
of the leadership team ahead of mine build and operation, while also ensuring
a successful transition to becoming a lithium producer. We are delighted to
welcome three General Managers to the team, each bringing significant
expertise from across the mining sector. We expect to continue to grow our
teams, both in Ghana and in Australia, as we near construction.

"With a number of key milestones ahead, we look forward to sharing our
progress in due course."

 

Key Contracts

A Bulk Customer Permit has been awarded by Ghana's Energy Commission, the
technical regulator of Ghana's energy sector, in respect of the Company's
Ewoyaa Lithium Project. The permit, which is valid for one year and renewable
before its expiration, classifies the Project as a bulk consumer of
electricity, allowing the Company to enter into a competitive bid process with
various bulk energy suppliers in Ghana, expected to reduce the overall power
cost for the Project by 30-50%. An overall operating cost reduction for the
Project will be recalculated once an agreement with the Company's preferred
bulk supplier has been finalised.

The Company is in advanced discussions to appoint an engineering firm to
conduct the EPCM of the main processing plant and all non-processing
infrastructure.

Having conducted site visits and shortlisted its preferred firms, the Company
has entered the tender stage to appoint a mining contractor for the Project
and, separately, for the procurement of the modular Dense Media Separation
("DMS") unit.

The Company intends to imminently commence the tender stage for the
procurement of the mobile crusher to supply feed to the modular DMS unit.

Following receipt of the approval from EPA for the diversion of the
transmission lines which traverse the Project site (refer announcement of 10
October 2023), the Company has selected its preferred vendor to carry out the
diversion and intends to award the contract for the work in Q2 2024, ensuring
alignment with the critical path for the Project.

 

Studies

Flotation Scoping Study

In partnership with DRA Global Limited (ASX: DRA, JSE: DRA, "DRA"), the
Company has now completed the Flotation Scoping Study to assess the viability
of including a flotation circuit downstream from the DMS-only plant at Ewoyaa.

As anticipated by the Company, the results of the Scoping Study confirm the
viability of beneficiating the 4.7Mt of 1.2% Li(2)O naturally-occurring fines
material(1), currently intended to be sold as a low-grade lithium secondary
product (as outlined in the Definitive Feasibility Study for the Project,
refer announcement of 29 June 2023), as feedstock for the flotation circuit.
The higher value, lower volume flotation concentrate product would replace the
secondary product, reducing the Company's exposure to the low-grade
lithium-bearing products market in the event that the market is adversely
affected in the near-to-medium term.

The Study also supports the potential to process the DMS processing plant
middlings, which were not previously considered a saleable product from
Ewoyaa, through the flotation circuit to achieve >5% Li(2)O concentrate
grades. Repeatability testwork is required to determine the volume and grade
that can be achieved to evaluate the potential enhancement to the value of the
Project.

In addition, the results of the Study confirm the significant (circa fourfold)
improvement of metal recovery of the finer-grained P2 spodumene-bearing
pegmatite material through the flotation circuit versus when it is processed
through the main DMS plant alone.

Results of the Study, therefore, support the Company's case for the inclusion
of a flotation circuit, which is not on the critical path for the construction
or operation of the main DMS plant, as a value-addition proposition at the
Project.

The Company intends to commence construction and the staged integration of the
flotation circuit once the main plant consistently delivers its intended
nameplate throughput of 2.7Mt per annum.

 

Feldspar Study

Identified as an opportunity to further enhance the economics of the Project
and to be supplied into the local Ghanaian ceramics market, in August 2023,
the Company signed a Memorandum of Understanding with the University of Mines
and Technology ("UMaT"), Tarkwa in the Western Region of Ghana, to conduct a
Definitive Feasibility Study ("Feldspar Study") to assess the viability of
producing feldspar as a by-product of spodumene concentrate production at the
Project.

In line with the Feldspar Study, the Company has now completed sodium analysis
of archive drilling sample pulps stored at the Project site. The sodium
analysis, along with X-ray diffraction ("XRD") analysis of a selection of
whole rock pegmatite samples, will enable the Company to define a maiden
Mineral Resource Estimate ("MRE") for feldspar production at Ewoyaa.

The maiden MRE, which will prioritise the first five years of the Project's
mine schedule, is expected in Q4 2023, with the results of the Feldspar Study
expected in Q1 2024, as agreed under the terms of the grant of the Mining
Lease for the Project.

The Company believes that the Project represents a major domestic source of
feldspar. If proven to be viable, the Company believes that Ewoyaa's feldspar
production can generate significant value to the Project, to the local
communities within the Central Region and to Ghana more broadly, including
through the creation of new direct jobs in the ceramics sector and the
development of businesses and services closely related to the industry.

The Project's economics under the terms of the grant of the Mining Lease
(refer announcement of 20 October 2023) do not currently consider the
inclusion of any activity related to the production of feldspar.

 

Downstream Conversion Study

Initiated in September 2023, the Company has commenced work in partnership
with major Engineering Procurement and Construction firm Mincore to conduct a
Scoping Study to assess the viability and economic benefits of delivering a
downstream conversion plant in Ghana ("Downstream Conversion Study") and the
potential to produce higher purity lithium products from spodumene concentrate
produced at Ewoyaa.

As agreed under the terms of the grant of the Mining Lease for the Project,
the Company expects to announce the results of the Downstream Conversion Study
in Q1 2024.

Subject to the results of the Downstream Conversion Study and the evaluation
of the relevant economic and market conditions, the Company has the right to
establish a lithium conversion plant in Ghana. The Government believes that
the establishment of a downstream plant will generate considerable benefits to
Ghana and, as such, has offered incentives to support the Company if it
decides to undertake the work.

 

Permitting

Following ministerial grant of the Mining Lease for the Project in October
2023, representatives of the Government of Ghana have publicly expressed their
desire to ratify the Mining Lease before the end of the calendar year.

Concurrently, the Company is undergoing activities to obtain the necessary
approvals and permits required ahead of construction of the Project.

The Company has submitted its Scoping Report, which includes the Terms of
Reference and is based on the activities proposed in the agreed Mining Lease,
for Environmental Protection Agency ("EPA") review and approval. The Report
has subsequently been gazetted by the EPA for public consideration and
comment.

The Company has held multiple stakeholder meetings each year since it
commenced exploration activities in Ghana. On 26 October 2023, the Company
held its inaugural Community Consultative Committee ("CCC") meeting in
Saltpond, within Ghana's Mfantseman Municipality. Chaired by Municipal Chief
Executive, Hon. Ike Lord Ennu and comprising representatives of the
communities surrounding the Project area, including chiefs and elders of the
local communities, the CCC has been established to enable transparent
discussion to maximise the value of the Project for the local population.
During the inaugural meeting, Country Manager Abdul Razak explained in greater
detail the proposed activities of the Company, as referred to in the grant of
the Mining Lease for the Project.

The local community continues to express its overwhelming support for the
advancement of the Project, acknowledging the significant benefit Ewoyaa can
bring to the communities surrounding the Project area.

 

Inaugural meeting of the Community Consultative Committee, held in Saltpond

 

Final Investment Decision ("FID")

Final Investment Decision is expected to be made by the Company and its
funding partner, Piedmont Lithium Inc. (Nasdaq: PLL; ASX: PLL, "Piedmont")
upon receipt of EPA approval and the grant of a Mine Operating Permit.

Ahead of FID, using a risk-based approach, the Company will establish criteria
for its funding of milestones deemed on the critical path for the development
of the Project. This is intended to enable the completion of early works,
which includes purchasing long-lead items and awarding both strategic
contracts and limited notices to proceed.

 

Key Strategic Appointments

The Company has made a number of recent strategic hires, including the
appointment of three General Managers, to bolster the experience and expertise
of the team to prepare the Company as it continues to grow, ultimately
targeting shovel readiness, mine build and operatorship.

Ahmed-Salim Adam joins the Company as General Manager, Operations. Ahmed-Salim
is an accomplished mining General Manager with over 15 years' experience
leading various large-scale projects in Ghana, across all stages of mine
development, production and closure, with a focus on safety and
sustainability. With a thorough understanding of technical, financial and
regulatory complexities within the mining sector, as well as strong leadership
qualities, Ahmed-Salim has a proven ability of managing challenging technical
operations and implementing initiatives to improve processes and deliver upon
operational and business objectives.

Andrew Henry joins the Company as General Manager, Commercial and Finance.
Andrew brings to the Company significant commercial and finance management
experience, including within the mining sector, where he has honed his
expertise on strategy, planning and analysis, contracts, and large-scale
project development. Most recently, Andrew held the role of Commercial Manager
at global lithium chemicals company Allkem and, prior to that, he spent over 4
years with major gold mining company Newcrest Mining.

Simone Horsfall joins the Company as General Manager, People. Simone is a
senior human resources professional with a focus on the mining sector. She
previously spent over a decade at AngloGold Ashanti as Human Resources Manager
and, more recently, at 29Metals as Group Manager, Human Resources. Simone's
appointment aims to support the Company's successful transition towards
becoming a globally significant lithium producer.

In line with the growth of the Company's Project development team, Atlantic
Lithium has signed a 5-year lease for an office in West Perth, Australia.

 

 

End Notes

(1) Ore Reserves, Mineral Resources and Production Targets

The information in this announcement that relates to Ore Reserves, Mineral
Resources and Production Targets complies with the 2012 Edition of the
Australasian Code for Reporting of Exploration Results, Mineral Resources and
Ore Reserves (JORC Code). The information in this announcement relating to
Production Targets is extracted from the Ewoyaa Lithium Project Definitive
Feasibility Study ("DFS"), announced by the Company on 29 June 2023, which is
available at atlanticlithium.com.au (http://atlanticlithium.com.au) . The
Company confirms that all technical parameters underpinning the DFS continue
to apply. Material assumptions for the Project have been revised on grant of
the Mining Lease for the Project, announced by the Company on 20 October 2023.
The Company is not aware of any new information or data that materially
affects the information included in this announcement or the announcements
dated 29 June 2023 and 20 October 2023.

 

 

 

FOR ANY FURTHER INFORMATION, PLEASE CONTACT:

ATLANTIC LITHIUM LIMITED

Neil Herbert (Executive Chairman)

Amanda Harsas (Finance Director and Company Secretary)

                   www.atlanticlithium.com.au
                   IR@atlanticlithium.com.au
                   Tel: +61 2 8072 0640

 SP Angel Corporate Finance LLP      Yellow Jersey PR Limited      Canaccord Genuity Limited

 Nominated Adviser                   Charles Goodwin               Financial Adviser:

 Jeff Keating                        Bessie Elliot                 Raj Khatri (UK) /

                                   atlantic@yellowjerseypr.com

 Charlie Bouverat
                             Duncan St John, Christian Calabrese (Australia)

                                   Tel: +44 (0)20 3004 9512

 Tel: +44 (0)20 3470 0470

                                                                   Corporate Broking:

                                                                   James Asensio

                                                                   Tel: +44 (0) 20 7523 4500

 

NOTES TO EDITORS:

About Atlantic Lithium

www.atlanticlithium.com.au (http://www.atlanticlithium.com.au/)

Atlantic Lithium is an AIM and ASX-listed lithium company advancing a
portfolio of lithium projects in Ghana and Côte d'Ivoire through to
production.

The Company's flagship project, the Ewoyaa Project in Ghana, is a significant
lithium spodumene pegmatite discovery on track to become Ghana's first
lithium-producing mine.

The Definitive Feasibility Study for the Project indicates the production of
3.6Mt of spodumene concentrate over a 12-year mine life, making it one of the
top 10 largest spodumene concentrate mines in the world.

The Project, which was awarded a Mining Lease in October 2023, is being
developed under a funding agreement with Piedmont Lithium Inc.

Atlantic Lithium holds 509km(2) and 774km(2) of tenure across Ghana and Côte
d'Ivoire respectively, comprising significantly under-explored, highly
prospective licences.

 

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