REG - Atlantic Lithium Ltd - Quarterly Activities and Cash Flow Report
31/01/2024 07:00
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RNS Number : 5021B Atlantic Lithium Limited 31 January 2024
31 January 2024
Quarterly Activities and Cash Flow Report
for the quarter ended 31 December 2023
Atlantic Lithium takes major stride towards production with grant of historic
Mining Lease
in respect of the Ewoyaa Lithium Project
The Board of 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 present its Quarterly Activities and Cash Flow Report for the
period ended 31 December 2023.
Highlights from the Reporting Period:
Project Development:
- Historic Mining Lease, the first for a lithium project in Ghana,
granted in respect of the Company's flagship Ewoyaa Lithium Project ("Ewoyaa"
or the "Project").
· Grant of the Mining Lease represents a major endorsement from the
Government of Ghana and serves as a significant de-risking milestone for the
advancement of the Project towards production.
· The agreed terms of the Mining Lease position Ewoyaa as one of
the lowest capital and operating cost hard rock lithium projects globally and
indicate the Project's strong commercial viability and exceptional
profitability for a 2.7Mtpa steady state operation, producing a total of 3.6Mt
of spodumene concentrate (approximately 350,000tpa) over a 12-year mine
life(1):
o Ewoyaa to become one of the top 10 largest spodumene concentrate
producers(1);
o Payback period of main processing plant of 9.5 months;
o C1 cash operating costs of US$377/t of concentrate Free-On-Board ("FOB")
Ghana Port, after by-product credits, All in Sustaining Cost ("AISC") of
US$675/t;
o Development cost estimate of US$185m; to be substantially funded by
Piedmont Lithium Inc. ("Piedmont") and planned investment by Ghana's sovereign
wealth fund, the Minerals Income Investment Fund ("MIIF");
o Post-tax NPV(8) of US$1.3bn, with free cash flow of US$2.1bn from Life of
Mine ("LOM") revenues of US$6.6bn, considering a US$1,410/t long-term
concentrate price, FOB Ghana.
- Completion of the Flotation Scoping Study which confirms the
viability of the inclusion of a flotation circuit downstream and running
independently from the DMS-only processing plant at Ewoyaa for future value
addition.
- Environmental Protection Agency authorisation granted to divert
two transmission lines that currently traverse planned mining areas of the
Mankessim licence, which contains the Ewoyaa Mining Lease area.
- Awarded Bulk Customer Permit in respect of the electricity
requirements of the Project, expected to deliver a 30-50% overall power cost
reduction for the Project.
Exploration:
- Maiden JORC (2012) compliant 15.7Mt at 40.2% Feldspar Mineral
Resource Estimate (MRE) reported for the Project, including 13.7Mt (87%) in
the Measured and Indicated categories, based on approximately the first five
years of planned production from the Project, as detailed in the Ewoyaa DFS
for the Project.
· Feldspar MRE enables the potential inclusion of feldspar
by-product credits in future revisions of the Ewoyaa feasibility studies,
believed to drive down operating costs and further enhance the value of the
Project.
· Indicates the possibility for Ewoyaa to become a major producer
of domestic feldspar in Ghana, which the Company intends to supply into the
local Ghanaian ceramics market.
- Multiple broad intervals of visible spodumene and 106m
continuous pegmatite interval, the longest continuous pegmatite interval
reported in the 2023 drilling programme to date, observed from drilling
outside of the current Mineral Resource Estimate(1) (MRE).
- Ongoing 2023 drilling programme increased from a planned 18,500m
to 26,500m.
· Further assay results received for 2,362m of resource and
metallurgical reverse circulation ("RC") and diamond core ("DD") drilling
completed at Ewoyaa as part of the enhanced 2023 programme.
· Post-period end, increased the planned programme by an additional
3,000m of site sterilisation drilling, taking the total planned programme to
29,500m, intended to support mine construction.
- Grant of highly prospective, undrilled Bewadze and Senya Beraku
prospecting licences in the eastern portion of the Company's Cape Coast
Lithium Portfolio in Ghana.
· Grant of the licences indicates the Government's support of the
Company's efforts to grow its lithium resources in Ghana.
Corporate:
- Successful Equity Placing raising A$8m, enabling the completion
of the activities agreed under the grant of the Mining Lease for the Project,
key items of early works and permitting-related Project expenditure, further
extensional drilling, and for working capital purposes.
- Rejection of two conditional and non-binding offers from the
Company's largest shareholder Assore International Holdings Limited ("Assore")
to acquire all the shares in the Company that it does not already own at an
offer price of £0.33 per share (A$0.63); offers rejected on the basis that
they undervalued the Company and that they were not in the best interests of
shareholders.
- Appointment of four General Managers as the Company looks to
strengthen its leadership team as it transitions towards mine construction and
operation.
- Appointment of highly regarded mining executive Jonathan Henry
to the Company's Board of Directors as Independent Non-Executive Director.
- Cash on hand at end of quarter was A$9.8m.
Post-period end:
- Completion of the Minerals Income Investment Fund of Ghana's
("MIIF") Subscription for 19,245,574 Atlantic Lithium shares for a value of
US$5m; part of MIIF's agreed total US$32.9m Strategic Investment in the
Company and its Ghanaian subsidiaries to expedite the development of the
Project.
- Completion of Stage 1 of the Company's competitive offtake
partnering process to secure funding for a portion of the remaining 50%
available feedstock from Ewoyaa to expedite the development of the Project.
- Largest shareholder Assore increased its stake in the Company to
28.4% through the purchase of shares from strategic funding partner Piedmont
at a premium to the current share price.
Sustainability:
- Awarded Best Performer in Exploration Award (Junior Category) at
the Ghana Mining Industry Awards for a second consecutive year.
- Inaugural Community Consultative Committee meeting, comprising
representatives of the Project's local communities, including chiefs and
elders, held in Saltpond and attended by members of the Atlantic Lithium team.
- Publication of "Driving Generational Change for Ghana" key
stakeholder video, highlighting significant local support for the Ewoyaa
Lithium Project.
Commenting, Neil Herbert, Executive Chairman of Atlantic Lithium, said:
"The grant of the Mining Lease during the quarter ended 31 December 2023
represents the most significant milestone for the Ewoyaa Lithium Project
to-date. Under the terms agreed, the Mining Lease indicates that Ewoyaa
remains one of the lowest capital and operating cost hard rock lithium
projects globally, with strong commercial viability and exceptional
profitability potential.
"Against a challenging market backdrop for lithium projects, we believe
Ewoyaa's underlying fundamentals, notably its proximity to existing
infrastructure and the favourable nature of the deposit, as well as the
impressive economic outputs indicated by the DFS, put the Project in good
stead versus its peers. Serving as a clear indication of the government of
Ghana's belief in the Company to lead the country's lithium production
objectives, the Mining Lease now enables us to set our sights on progressing
the Project towards construction.
"In doing so, we remain focused on de-risking and adding value to the Project.
To this end, we have been pleased to deliver the maiden Feldspar Mineral
Resource Estimate and results of the Flotation Scoping Study.
"In addition, our exploration efforts have continued to deliver promising
results during the period. We are pleased to have observed multiple broad
intervals of visible spodumene and a continuous pegmatite interval of 106m
outside of the current MRE footprint, providing us with confidence in
significant potential resource growth at Ewoyaa. Through the ongoing enhanced
2023 drilling programme, we aim to deliver an increased MRE later this year.
"As the Company continues to transition towards near-term lithium producer, we
have bolstered our leadership team with several strategic hires, including
four General Managers and the appointment of Jonathan Henry as Independent
Non-Executive Director. We also expect the imminent appointment of a
representative of MIIF to the Company's Board following the completion of
MIIF's US$5m Subscription. Through these appointments, we bring valuable
mining experience to the Company, placing Atlantic Lithium in a strong
position as we target mine build, construction and operation.
"At the same time, I would like to thank Patrick Brindle for his valuable
contribution as he steps down from his role on the Board. On behalf of the
Atlantic Lithium team, I wish him every success in his future endeavours.
"With the permitting phase progressing well, 2024 is set to be an exciting
year for the Company. In the first few weeks, we have already welcomed Ghana's
mineral sovereign wealth fund as a new, major shareholder, and have completed
the first stage of our competitive offtake partnering process. We look forward
to sharing further developments with the market in due course."
This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR.
Figures and Tables referred to in this release can be viewed in the PDF
version available via this link:
http://www.rns-pdf.londonstockexchange.com/rns/5021B_1-2024-1-31.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/5021B_1-2024-1-31.pdf)
Ewoyaa Lithium Project, Ghana, West Africa
Ewoyaa is the Company's flagship project, targeted to become Ghana's first
lithium-producing mine.
The Project has secured project development funding via a partnership
agreement with Piedmont Lithium Inc. (NASDAQ: PLL; ASX: PLL, "Piedmont", refer
announcement of 31 August 2021). The Project, located in Ghana, West Africa,
approximately 100km southwest of the capital of Accra, comprises eight main
deposits, including Ewoyaa, Okwesi, Anokyi, Grasscutter, Abonko, Kaampakrom,
Sill and Bypass. The Project is well located being adjacent to operational
infrastructure including within 1km of the Takoradi - Accra N1 highway, 110km
from the Takoradi deep-sea port and adjacent to grid power, within the
pro-mining jurisdiction of Ghana (refer Figure 1).
Figure 1: Location of the Ewoyaa Lithium Project
Interest in Tenements
At the end of the quarter ending 31 December 2023, the Company had an interest
in the following tenements:
Tenement Number Tenement Principal Grant Date/ Expiry Date Term Change during Quarter
Name
Holder
Application Date
Ghana
PL3/67 Apam East Obotan Minerals Company Limited 06.11.23 05.11.26 3 years Renewed
(JV MODA Minerals Limited)
PL3/92 Apam West Obotan Minerals Company Limited 06.11.23 05.11.26 3 years Renewed
(JV MODA Minerals Limited)
RL 3/55 Mankessim Barari DV Ghana Limited 27.07.21 26.07.24 3 years None
(90% Atlantic)
PL3/102 Saltpond Joy Transporters Limited 06.11.23 05.11.26 3 years Renewed
(100% Atlantic)
PL3/109 Mankessim South Green Metals Resources Limited 06.11.23 05.11.26 3 years Renewed
(100% Atlantic)
PL3/106 Cape Coast Joy Transporters Limited 15.11.21 14.11.24 3 years None
(100% Atlantic)
RML-N-3/181 Senya Beraku Green Metals Resources Limited (100% Atlantic) 09.11.23 08.11.26 3 years Granted
PL-I-3/15 Bewadze Green Metals Resources Limited 09.11.23 08.11.26 3 years Granted
(100% Atlantic)
ML-3/239 Mankessim Mining Lease Barari DV Ghana Limited (90% Atlantic) 20.10.23 19.10.38 15 years Granted
Ekrubaadze PL Green Metals Resources Limited 03.10.23 New Application
(100% Atlantic)
Asebu (Winneba North) Green Metals Resources Limited (100% Atlantic) 28.06.21 Application None
Mankwadze (Winneba South) Green Metals Resources Limited (100% Atlantic) 28.06.21 Application None
Mankwadzi Obotan Minerals Company Limited 15.03.18 Application None
(JV MODA Minerals Limited)
Onyadze Green Metals Resources Limited 23.08.21 Application None
(100% Atlantic)
Ivory Coast
PR695 Rubino Khaleesi Resources SARL 20.10.16 Application None
(100% Atlantic)
PR694 Agboville Khaleesi Resources SARL 20.10.16 Application None
(100% Atlantic)
December Quarter Activities
Project Development
Ewoyaa Lithium Project Mining Lease
On 20 October 2023, the Company announced that Ghana's Ministry of Lands and
Natural Resources had granted a Mining Lease in respect of the Ewoyaa Lithium
Project, comprising the proposed Ewoyaa Lithium Mine and Processing Plant.
The Mining Lease, the first to be issued for lithium in Ghana, grants the
Company exclusive rights to work, develop and produce lithium (and other
associated minerals) over the entirety of the 42.63 km(2) area ("Lease Area")
within the Mankessim licence, held by the Company's subsidiary Barari DV Ghana
Limited ("Barari") and containing the Ewoyaa Project, for an initial period of
15 years.
The grant of the Mining Lease represents a major de-risking milestone for the
Project and indicates the Government of Ghana's underlying support for the
advancement of the Project. Ewoyaa is now on track to become a top 10 hard
rock spodumene concentrate mine(1).
The agreed terms, which align with the Government's new Green Minerals Policy,
reaffirm the Project's strong commercial viability and exceptional
profitability potential for a 2.7Mtpa steady state operation, producing a
total of 3.6Mt of spodumene concentrate (approximately 350,000tpa) over a
12-year mine life(1):
· Payback period of main processing plant of 9.5 months;
· C1 cash operating costs of US$377/t of concentrate Free-On-Board
("FOB") Ghana Port, after by-product credits, All in Sustaining Cost ("AISC")
of US$675/t;
· Development cost estimate of US$185m;
· Post-tax NPV(8) of US$1.3bn, with free cash flow of US$2.1bn from
Life of Mine ("LOM") revenues of US$6.6bn, considering a US$1,410/t long-term
concentrate price, FOB Ghana.
Summary of Key Terms
Under the terms of the Mining Lease, the Government of Ghana will be entitled
to a 13% free carried interest in the Project and a 10% royalty rate once in
production.
Table 1 below is a table of key Project metrics, using the parameters as
defined in the DFS for the Project and incorporating the agreed terms of the
Mining Lease(1).
The full Project metrics can be found in Table 3 in the Appendix of the
announcement dated 20 October 2023.
Table 1: Summary of Ewoyaa Key Metrics - Mining Lease Terms (100% Project
Basis(2))
Item Units Mining Lease
Revenue (all products) US$M 6,566
LOM Concentrate Pricing, FOB Ghana US$/t 1,587
Post-tax IRR % 94
C1 Cash Cost, after secondary product credits US$/t 377
All In Sustaining Cost (AISC) US$/t 675
Surplus Cashflow, Post Tax US$M 2,091
NPV(8) Post Tax US$M 1,301
Payback - Combined Months 17
Payback - Main Plant Months 9.5
Payback - Modular DMS Unit Months 3
EBITDA US$M 3,365
EBIT US$M 3,022
NPAT, LOM US$M 2,004
(
2) Whilst the asset is currently wholly owned by Atlantic Lithium Ltd,
Piedmont Lithium Inc. can earn up to half of the Company's ownership in the
Project through its funding agreement whereby Piedmont will sole fund the
first US$70m, and 50% of additional costs thereafter, of the total US$185m
development expenditure indicated in the DFS for the Project. The Government
of Ghana has the right to a 13% free carry once in production and the Minerals
Income Investment Fund has agreed Heads of Terms with the Company, which will
see it earn a 6% contributing interest in the Project.
(3) Mr S. Searle of Ashmore Advisory Pty Ltd is the Competent Persons for
Mineral Resources and Mr H. Warries of Mining Focus Consultants Pty Ltd for
Ore Reserves. For full Competent Persons statements, refer to the Competent
Persons section later in this announcement.
NOTE: Mineral Resources are inclusive of the Ore Reserves.
Under the terms of the Mining Lease, the Company has agreed to undertake a
Definitive Feasibility Study ("Feldspar Study") to assess the viability of
producing and processing feldspar feedstock as by-product of spodumene
concentrate production at the Project (refer announcement of 15 August 2023).
The Feldspar Study is nearing completion and remains on track for delivery
before the end of Q1 2024.
The Company also agreed to conduct a scoping study ("Downstream Conversion
Study") to evaluate the economic benefits and viability of downstream lithium
conversion in Ghana.
The Downstream Conversion Study remains on track for delivery before the end
of Q1 2024.
Furthermore, in accordance with Ghana's Local Content Regulations, the Company
has committed to establishing a path for the Company to list on the Ghana
Stock Exchange.
The Company is currently compiling the necessary documents to lodge its
application to list the Company's shares to trading on the Ghana Stock
Exchange. Further updates on this process will be announced by the Company in
due course.
Project Funding
Under the Project's current funding arrangements and considering a total
development expenditure of US$185m for the Project, as indicated in the DFS,
Piedmont are required to contribute the first US$70m of development
expenditure as sole funding.
The Company is currently in discussions with Piedmont in relation to
outstanding development expenditure obligations for the period October to
December 2023 of US$1.2m. In the event that payment is not received, there is
an established process for resolution.
Atlantic Lithium looks forward to collaboratively resolving this matter and to
the continued advancement of the Project.
The Company is currently undertaking a competitive offtake partnering process
that is intended to attract funding offers which would cover the Company's
allocation of development expenditure for the Project. The Company announced
post-period end that it had completed Stage 1 of the process and was moving to
a more detailed Stage 2 due diligence phase.
Further details on the ongoing process can be found in the Corporate section
of this announcement.
The Company has also agreed Heads of Terms with the Minerals Income Investment
Fund of Ghana ("MIIF") to invest a total of US$32.9m to support the
development of the Ewoyaa Lithium Project and broader Cape Coast Lithium
Portfolio in Ghana ("Strategic Investment", refer announcement of 8 September
2023).
In line with the first stage of the Strategic Investment, post-period end,
MIIF subscribed for shares in Atlantic Lithium for a total consideration of
US$5m, which will be used towards Project development funding.
In line with the second stage of the total planned investment, MIIF has also
agreed non-binding Heads of Terms to invest US$27.9m in the Company's Ghanaian
subsidiaries which hold the Company's lithium assets in Ghana ("Ghana
Portfolio") to acquire a 6% contributing interest in the Ghana Portfolio,
inclusive of the Ewoyaa Lithium Project. Both the US$27.9m investment in the
Ghana Portfolio and the contributing interest will take the form of funding of
development, exploration and studies expenditure to support the advancement of
the Project.
Further details on the MIIF's Strategic Investment can be found in the
Corporate section of this announcement.
Flotation Scoping Study
During the period, the Company announced the completion of a Scoping Study
undertaken in partnership with DRA Global Limited (ASX: DRA, JSE: DRA) to
assess the viability of including a flotation circuit downstream from the
DMS-only plant at Ewoyaa ("Flotation Scoping Study", refer announcement of 22
November 2023).
As the Company anticipated, the results of the Study confirm the viability of
beneficiating the 4.7Mt of 1.2% Li(2)O naturally-occurring fines material(1),
outlined in the DFS for the Project to be intended to be sold as a low-grade
lithium secondary product (refer announcement of 29 June 2023), as feedstock
for the flotation circuit. The Company intends that the higher value, lower
volume flotation concentrate product would replace the secondary product,
reducing its 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 results of the Study also corroborate the Company's intention 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 support the case for the inclusion of a flotation circuit
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.
EPA Approval to Divert Mankessim Transmission Lines
Representing an important step towards shovel readiness at Ewoyaa,
Environmental Protection Agency ("EPA") authorisation was granted during the
period for Ghana Grid Company Ltd ("GRIDCo") to carry out the diversion of two
transmission lines, which currently traverse planned mining areas within the
Lease Area, to the northern border of the Company's Mankessim licence (refer
announcement of 10 October 2023).
The Company remains on track to award the contract for the diversion work in
Q2 2024 to ensure alignment with the critical path for the Project.
Bulk Consumer Permit
During the period, a Bulk Customer Permit was awarded by Ghana's Energy
Commission in respect of the Project. The permit, which is valid for one year
and renewable before its expiration, classifies the Project as a bulk consumer
of electricity and allows the Company to enter into a competitive bid process
with various bulk energy suppliers in Ghana. The process is expected to enable
the Company to secure a 30-50% reduction in the Project's overall power cost.
An overall operating cost reduction for the Project is intended to be
recalculated once an agreement with the Company's preferred bulk supplier has
been finalised.
EPCM Contract
The Company has engaged a reputable engineering house to finalise the tender
document for the execution of the Project on an EPCM basis, which remains
targeted for award in the first half of 2024.
Exploration
Maiden Feldspar Mineral Resource Estimate
Having been identified as a by-product of spodumene concentrate operations at
Ewoyaa, on 12 December 2023, the Company reported a maiden JORC (2012)
compliant Mineral Resource Estimate of 15.7Mt at 40.2% feldspar ("Feldspar
MRE") for the Project.
The Feldspar MRE is based on the same geological model that delivered the
35.3Mt MRE(1) for the Project, as announced in February 2023, and is confined
to the Ewoyaa Main, Ewoyaa Northeast, Ewoyaa South-1 and Ewoyaa South-2
deposits, which represent approximately the first five years of planned
production from the Ewoyaa Lithium Project, as detailed in the DFS for the
Project.
The Feldspar MRE includes a total of 3.5Mt at 39.7% feldspar in the Measured
category, 10.2Mt at 40.5% feldspar in the Indicated category and 2Mt at 40.1%
feldspar in the Inferred category. In addition to the feldspar, further
by-products of quartz and muscovite were estimated and included (refer Table
2).
Table 2: Ewoyaa Lithium Project Feldspar Mineral Resource Estimate (0.5%
Li(2)O Cut-off)
Measured Mineral Resource
Deposit Tonnage Feldspar Quartz Muscovite
Mt % Mt % Mt % Mt
Ewoyaa Main 3.5 39.7 1.37 31.8 1.10 11.5 0.40
Total 3.5* 39.7 1.37 31.8 1.10 11.5 0.40
Indicated Mineral Resource
Deposit Tonnage Feldspar Quartz Muscovite
Mt % Mt % Mt % Mt
Ewoyaa Main 6.5 40.8 2.66 31.6 2.06 11.9 0.78
Ewoyaa Northeast 3.1 39.4 1.23 29.6 0.93 11.1 0.35
Ewoyaa South 1 0.4 42.1 0.16 29.3 0.11 11.7 0.04
Ewoyaa South 2 0.2 41.9 0.07 25.2 0.04 13.0 0.02
Total 10.2* 40.5 4.13 30.8 3.14 11.7 1.19
Inferred Mineral Resource
Deposit Tonnage Feldspar Quartz Muscovite
Mt % Mt % Mt % Mt
Ewoyaa Main 0.6 41.8 0.23 30.6 0.17 11.5 0.06
Ewoyaa Northeast 0.4 39.5 0.15 30.5 0.11 13.0 0.05
Ewoyaa South 1 0.4 40.4 0.16 32.6 0.13 12.8 0.05
Ewoyaa South 2 0.7 38.8 0.27 31.7 0.22 12.6 0.09
Total 2.0* 40.1 0.81 31.4 0.63 12.4 0.25
Total Mineral Resource
Deposit Tonnage Feldspar Quartz Muscovite
Mt % Mt % Mt % Mt
Ewoyaa Main 10.5 40.5 4.27 31.6 3.33 11.7 1.24
Ewoyaa Northeast 3.5 39.4 1.38 29.7 1.04 11.3 0.40
Ewoyaa South 1 0.8 41.3 0.32 31.0 0.24 12.2 0.09
Ewoyaa South 2 0.9 39.4 0.35 30.4 0.27 12.7 0.11
Total 15.7* 40.2 6.31 31.1 4.87 11.7 1.84
NOTE: Based on the lithium Mineral Resource Estimate(1) reported for the
Project in February 2023 and confined to the Ewoyaa Main, Ewoyaa Northeast,
Ewoyaa South-1 and Ewoyaa South-2 deposits. Total tonnage figures do not
include tonnage of spodumene as indicated in the February 2023 Mineral
Resource Estimate(1) for the Project, nor minor accessory minerals.
The Feldspar MRE has been compiled under the supervision of Mr. Shaun Searle
who is a director of Ashmore Advisory Pty Ltd and a Registered Member of the
Australian Institute of Geoscientists. Mr. Searle has sufficient experience
that is relevant to the style of mineralisation and type of deposit under
consideration and to the activity that he has undertaken to qualify as a
Competent Person as defined in the JORC Code and a Qualified Person under the
AIM Rules for Companies. Mr Searle consents to the inclusion of the
information in relation to the Mineral Resource in the form and context in
which it appears.
All Mineral Resources figures reported in the table above represent estimates
at December 2023. Mineral Resource estimates are not precise calculations,
being dependent on the interpretation of limited information on the location,
shape and continuity of the occurrence and on the available sampling results.
The totals contained in the above table have been rounded to reflect the
relative uncertainty of the estimate. Rounding may cause some computational
discrepancies.
Mineral Resources are reported in accordance with the Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves (The
Joint Ore Reserves Committee Code - JORC 2012 Edition).
The Company believes that Ewoyaa represents a major source of domestic
feldspar in Ghana, which is widely used in the ceramics industry. As a
potentially considerable contributor to the growth of local businesses and
economy, the Company intends to supply the feldspar produced at Ewoyaa into
the local Ghanaian ceramics market.
Delivery of the Feldspar MRE enables the potential inclusion of feldspar
by-product credits in future revisions of the Ewoyaa feasibility studies,
expected by the Company to drive down operating costs and further enhance the
value of the Project.
The Company intends to conduct further sodium assay analysis and normative
mineralogical calculations for the remaining historic and current drill
campaigns outside the Ewoyaa Main, Ewoyaa Northeast, Ewoyaa South-1 and Ewoyaa
South-2 deposits, with the aim of increasing the current Feldspar MRE.
Initial test work of the feldspar produced at Ewoyaa assessed the quality of
two size fractions derived from dense media separation ("DMS"); 2.6 SG
oversize fraction with high total alkalis ("O/F") and 2.6 SG undersize
fraction with lower alkalis ("U/F") but significant Li(2)O at approximately
0.70%, which is a strong flux.
Following examination of chemical and mineralogical composition, ceramic
application trials were undertaken in Stoke-on-Trent (The Potteries) in the UK
for vitreous hotelware, high-end earthenware and floor tiles. Samples were wet
ground to the required particle size and incorporated into commercial recipes,
substituting for standard feldspars and nepheline syenite. Each prepared body
was factory fired and, in the case of vitreous hotelware and high-end
earthenware, biscuit (not glazed), glazed and decorated pieces were produced.
In all cases, the trial firings produced acceptable ware, comparable to
industry standards in all aspects, including contraction, water absorption,
density, porosity, shape, colour and appearance. Good results were delivered
at the vitreous hotelware factory (a world leading manufacturer of tableware
for the international hospitality industry), where the Ewoyaa feldspars were
substituted for Forshammer feldspar (produced in Sweden by Sibelco) (refer
Figure 2).
Figure 2: Trial-fired ceramic plates and bowls, manufactured
in biscuit (unglazed), glazed and decorated forms (left to right), comprising
of trial standard, O/F sample and U/F sample (top to bottom). The trials,
which deemed that no visual differences were detected between the trial
standard and sample plates, successfully produced industry-accepted standard
of ware across all aspects.
The Feldspar MRE will be incorporated into the Feldspar Definitive Feasibility
Study ("Feldspar Study"), which is due for completion by the end of Q1 2024,
undertaken to assess the viability and prospective market conditions for the
production of feldspar at Ewoyaa (refer announcement of 15 August 2023).
2023 Drilling Programme
During the reporting period, the Company continued to advance the exploration
and resource drilling programme across the Project and the Company's Cape
Coast Lithium Portfolio which commenced in Q1 2023 (refer announcement of 20
March 2023).
In November 2023, the Company announced the addition of 8,000m of extensional
resource drilling targeting resource growth to the programme, increasing the
planned 18,500m programme by 43% to a total of 26,500m (refer announcement of
07 November 2023).
The additional 8,000m of RC drilling is planned for resource depth and strike
extensions at the Okwesikrom, Anokyi, Grasscutter, Ewoyaa North-West and
Ewoyaa South-2 deposits (refer Figure 3).
Figure 3: Expanded resource extension programme with newly
planned holes highlighted in pink and deposit areas named
Post-period end, the Company extended the 26,500m programme by an additional
3,000m of plant site sterilisation drilling (taking the total planned
programme to 29,500m), intended to support the mine construction. Plant site
sterilisation drilling is expected to commence during Q1 2024 and will be
prioritised over the remaining planned deep resource extension drilling. The
Company intends to re-assess resource drilling plans in Q2 2024, whilst
reviewing all completed resource drilling during 2023 once remaining assay
results are received.
During the period, the Company also reported further assay results received
for 2,362m of resource and metallurgical reverse circulation ("RC") and
diamond core ("DD") drilling completed at Ewoyaa, which returned high-grade
infill and extensional drill intersections at the Ewoyaa Main, Anokyi and
Ewoyaa South-2 deposits.
Assay results reported in hole GDD0093 extend the mineralisation at the Ewoyaa
Main deposit outside of the current 35.3Mt @ 1.25% Li(2)O MRE footprint(1),
while shallow high-grade and broad infill drill intersections were returned at
Ewoyaa Main, Anokyi and Ewoyaa South-2, including 47.6m at 1.25% Li(2)O from
65.7m and 28.7m at 1.51% Li(2)O from 79.3m (refer Table 3).
Table 3: Drill intersection highlights at greater than 10 Li x m, reported
at a 0.4% Li2O cut-off and maximum of 4m of internal dilution
Hole_ID From_m To_m Interval_m Hole depth_m Li(2)O% Intersection Comment metal content Li x m Hole Purpose Deposit
GDD0105 65.7 113.3 47.6 150 1.25 GDD0105: 47.6m at 1.25% Li(2)O from 65.7m 59.42 Metallurgical Studies EWY_Main
GDD0107C 30 83 53 100 0.93 GDD0107C: 53m at 0.93% Li(2)O from 30m 49.29 Metallurgical Studies EWY_Main
GDD0109 79.3 108 28.7 180 1.51 GDD0109: 28.7m at 1.51% Li(2)O from 79.3m 43.24 Metallurgical Studies AKY
GDD0104 81.2 109.4 28.2 150 1.23 GDD0104: 28.2m at 1.23% Li(2)O from 81.2m 34.45 Metallurgical Studies EWY_Main
GDD0106 34 56.4 22.4 90 1.07 GDD0106: 22.4m at 1.07% Li(2)O from 34m 23.80 Metallurgical Studies EWY_Main
GDD0110 33 47 14 180 1.46 GDD0110: 14m at 1.46% Li(2)O from 33m 20.42 Metallurgical Studies AKY
GDD0108 83.9 106.4 16.1 140 1.04 GDD0108: 16.1m at 1.04% Li(2)O from 83.9m 16.74 Metallurgical Studies EWY_Sth2
GDD0093 182.7 198.2 15.5 300 0.83 GDD0093: 15.5m at 0.83% Li(2)O from 182.7m 12.83 Resource Drilling EWY_Main
GDD0108 111.6 120 8.4 140 1.28 GDD0108: 8.4m at 1.28% Li(2)O from 111.6m 10.69 Metallurgical Studies EWY_Sth2
Note: Metal content is based on intercept rather than estimated true width
On 28 November 2023, the Company announced the observation of multiple broad
intervals of pegmatite, including multiple broad intervals of coarse-grained
visible spodumene, in drilling at the Dog Leg prospect extension target on the
northern tip of the Ewoyaa Main deposit, outside of the current 35.3Mt @ 1.25%
Li(2)O MRE(1) for the Project.
Included within the observations, the Company reported the longest reported
continuous pegmatite interval in the 2023 drilling programme to date of 106m
in hole GRC1020 from 6m at the Dog-Leg target.
Highlight logged pegmatite intervals with visible estimates of spodumene modal
abundance in RC drill chips are summarised in Table 4 below, with all logged
intervals and collar details reported in Table 2 and Table 3 of the
announcement dated 28 November 2023.
Table 4: Highlight visual estimations of spodumene abundance in logged
pegmatite intervals in new reported drilling
Hole_ID Depth Depth Interval m Lithology Visible estimate Spodumene abundance % Downhole length vs true width
From_m
To_m
GRC1017 83 134 51 Pegmatite 25-30 true width not known
GRC1018 154 157 3 Pegmatite 5 true width not known
GRC1018 160 170 10 Pegmatite 5 true width not known
GRC1020 6 38 32 Pegmatite 5-10 true width not known
GRC1020 39 113 74 Pegmatite 20-25 true width not known
GRC1020 116 122 6 Pegmatite 10-15 true width not known
GRC1020 137 178 41 Pegmatite 20-25 true width not known
GRC1021 93 117 24 Pegmatite 15-20 true width not known
GRC1022 130 152 22 Pegmatite 20-25 true width not known
GRC1022 158 187 29 Pegmatite 20-25 true width not known
GRC1023 139 147 8 Pegmatite 5-10 true width not known
NOTE: Visual estimates of mineral abundance should never be considered a proxy
or substitute for laboratory analyses where concentrations or grades are the
factor of principal economic interest. Visual estimates also potentially
provide no information regarding impurities or deleterious physical properties
relevant to valuations.
Coarse-grained, P1-type spodumene pegmatite, as observed in the reported
drilling, is preferred for the Dense Media Separation ("DMS") process
flowsheet considered in the DFS for the Project.
Remaining assay results from the 2023 resource drilling programme are expected
during Q1 2024 and will be reported to market as soon as they are received and
pass internal QAQC.
Grant of Bewadze and Senya Beraku prospecting licences
During the period, the Company's wholly-owned Ghanaian subsidiary Green Metals
Resources Limited ("GMR") was granted the Bewadze and Senya Beraku prospecting
licences in the eastern portion of the Company's Cape Coast Lithium Portfolio
in Ghana (refer Figure 4).
The award of the licences provides the Company exclusive access to explore
new, undrilled tenure, covering 6.93km(2) and 82.11km(2), respectively,
offering significant potential to further enhance the Project and
demonstrating the Government of Ghana's alignment with the Company's lithium
exploration efforts.
Little/no modern previous exploration has been completed across the
newly-granted licence areas, which are well serviced by existing
infrastructure, including high-voltage transmission lines traversing the
licences and the adjacent N1 Accra-Takoradi highway.
The Bewadze licence had been previously noted as of particular interest by the
Company, being located along strike and within 300m of the historic
Egyasimanku Hill occurrence, where spodumene pegmatites have been observed,
making it highly prospective for lithium discovery.
The Company has planned extensive work programmes to evaluate the potential
for lithium and associated minerals at the newly-granted tenure, aiming to
grow its lithium reserves in Ghana.
Figure 4: Newly-granted Bewadze and Senya Beraku licences in
relation to Cape Coast Lithium Portfolio and Ewoyaa Project with geology
background and rubidium in soils geochemistry anomalism images.
Corporate
A$8 million Equity Placing
On 15 December 2023, the Company announced that it had successfully completed
an institutional placement ("Equity Placing"), raising A$8.0m (equivalent to
approximately £4.2m) at a price of A$0.44 (23.35 pence) per New Share ("Issue
Price").
The Equity Placing was undertaken in order to strengthen the Company's cash
balance and to facilitate key work to progress the Project in line with the
development schedule.
Proceeds of the fundraise are intended to enable the completion of activities
agreed under the grant of the Mining Lease for the Project, key items of early
works and permitting-related Project expenditure, for further extensional
drilling, and for working capital purposes.
In parallel to the Company's current funding arrangements for the advancement
of the Project, which comprise Piedmont's staged earn-in agreement, the agreed
non-binding Heads of Terms with the Minerals Income Investment Fund of Ghana
("MIIF") and the ongoing competitive partnering process for a portion of the
remaining available offtake at Ewoyaa, the completion of the Equity Placing
represents a major milestone towards fully de-risking the funding for the
Project.
Rejection of Non-binding Indicative Offers
On 15 November 2023, the Company announced the rejection of two conditional
and non-binding offers, on 7 November and an earlier offer on 2 October 2023,
from its largest shareholder Assore to acquire all the shares in the Company
that it does not already own at an offer price of £0.33 per share (A$0.63).
After careful consideration, the offers were rejected by the Atlantic Lithium
independent board committee, which was established to consider the approaches
from Assore, as they were deemed to undervalue the Company and not in the best
interests of shareholders.
There is no certainty that a further proposal will be received (from Assore or
any other third party). The Company remains focused on progressing its
activities to maximise value for all shareholders.
Appointment of General Managers
During the period, among a number of recent strategic hires, the Company
announced the appointment of three highly experienced General Managers,
bringing considerable expertise from the mining industry to the Company at a
pivotal time in the Company's progression.
Ahmed-Salim Adam, 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, joins the Company as General
Manager, Operations.
Andrew Henry joins as General Manager, Commercial and Finance, bringing to the
Company significant commercial and finance management experience, including
expertise on strategy, planning and analysis, contracts, and large-scale
project development.
Simone Horsfall, a senior human resources professional with a focus on the
mining sector, marks the third of the three General Managers, joining the
Company as General Manager, People. Simone's appointment aims to support the
Company's successful transition towards becoming a globally significant
lithium producer.
Post-period end, having joined the Company as Financial Reporting Manager in
June 2023, Belinda Gethin was promoted to General Manager, Corporate - Finance
and Company Secretary. Belinda brings a wealth of experience in all aspects of
statutory, financial and corporate reporting.
The Company continues to recruit actively for positions that support its
objectives. In line with the growth of the Company's Project development team,
Atlantic Lithium also signed a 5-year lease for an office in West Perth,
Australia during the period.
Appointment of Independent Non-Executive Director
On 20 December 2023, the Company was pleased to announce the appointment of
Jonathan Henry to the Board of Directors as Independent Non-Executive
Director.
Jonathan is a senior executive with significant, global listed company
experience, primarily in the mining industry, having held various leadership
and Board roles for nearly two decades. During this time, Jonathan has been
heavily involved in the strategic management and leadership of projects
towards production, commercialisation and, ultimately, the realisation of
shareholder value.
In line with his appointment, Len Kolff stepped down from his role on the
Board, although maintaining his role as Head of Business Development and Chief
Geologist, where he will continue to play a huge part in the continued success
in the Company's growth, to which he has contributed significantly to-date.
Post-period end
Completion of US$5m MIIF Subscription
Further to the Company's announcement on 8 September 2023, post-period end,
the Company announced the completion of a subscription undertaken by the
Minerals Income Investment Fund of Ghana ("MIIF") for 19,245,574 Atlantic
Lithium shares ("Subscription") at a price of US$0.2598 (A$0.39 / £0.20) per
share ("Subscription Shares"), for a value of US$5m (refer announcement of 24
January 2024).
The US$5m consideration is intended by the Company to be used towards Project
development funding.
The Subscription forms the first stage of MIIF's proposed total US$32.9m
investment in the Company and its Ghanaian Subsidiaries to expedite the
development of the Project and the broader Cape Coast Lithium Portfolio in
Ghana ("Ghana Portfolio") towards production.
MIIF's proposed Strategic Investment demonstrates MIIF's strong support as a
key local stakeholder in the advancement of the Project towards production.
Under the agreed terms of the Subscription, MIIF is entitled to nominate one
person to the Company's Board of Directors and will be granted 9,622,787
warrants at a price of US$0.3637.
Following the completion of the Subscription, the Company welcomes MIIF as a
new major, strategic shareholder and funding partner.
In line with the second stage of the Strategic Investment, subject to the
Company reaching a binding agreement with MIIF, MIIF has agreed to invest a
further US$27.9m in the Company's Ghanaian subsidiaries that hold the
Company's lithium interests in Ghana ("Ghana Portfolio"), to acquire a 6%
contributing interest in the Company's Ghana Portfolio, inclusive of the
Project.
Both the US$27.9m investment in the Ghana Portfolio and the contributing
interest will take the form of funding of development, exploration and studies
expenditure to support the advancement of the Project.
Completion of Stage 1 Offtake Partnering Process
Post-period end, the Company completed Stage 1 of the competitive offtake partnering process being led by Macquarie, to secure funding for a portion of the remaining 50% available feedstock from Ewoyaa.
The objective of the process is to attract funding offers to sufficiently
cover the Company's allocation of development expenditure for the Project, to
expedite and de-risk the development of the Project, realise attractive terms
for any offtake contracted and secure a well credentialled partner that will
support the Company's and Ghana's objectives of supplying lithium into the
global electric vehicle market.
Following the completion of Stage 1, the Company now moves to a more detailed
Stage 2 due diligence phase with the remaining preferred parties.
Assore Share Purchase
The Company's largest shareholder Assore increased its stake in the Company to
28.4% through the purchase of shares from strategic funding partner Piedmont
at a premium to the current share price. Piedmont's holding current sits at
5.2% following the share transaction.
The Company believes that Assore's purchase of Atlantic Lithium shares at a
premium reflects their belief in the Company's substantial value to be
unlocked.
Board Change
In line with Piedmont's sale of the Company's shares to Assore (refer
announcement of 23 January 2024) and its holding in Atlantic Lithium falling
below 9%, Piedmont has relinquished its right to position on the Company's
Board of Directors. Accordingly, on Monday, 29 January, Patrick Brindle
submitted his resignation in respect of his role on the Board with immediate
effect.
The Atlantic Lithium Board of Directors and management team wish to express
their thanks to Patrick for his valued contribution to the Company during his
tenure and wish him every success going forward.
Conferences Attended
The Company attended the following conferences and events during the period:
- 121 Mining Investment Conference, Sydney (17-18 October)
- Noosa Mining Investment Conference, Queensland (15-17 November)
- ShareCafé Hidden Gems webinar (17 November)
- 121 Mining Investment Conference, London (20-21 November)
- Proactive One2One Mining Investor Forum, London (23 November)
- Macquarie Western Australia Forum, Perth (28 November)
- Swiss Mining Institute, Zurich (29-30 November)
Investor Meet Company Webinar
The Company intends to host its next investor webinar on the Investor Meet
Company platform at 9:00 am London time (8:00 pm Sydney time) on Thursday, 1
February 2024. Investors can sign up to Investor Meet Company to watch the
Company's previous webinars and be notified of upcoming events via the
following link:
https://www.investormeetcompany.com/atlantic-lithium-limited/register-investor
(https://www.investormeetcompany.com/atlantic-lithium-limited/register-investor)
Sustainability
For a second consecutive year, Atlantic Lithium was proud to be awarded the
Best Performer in Exploration Award (Junior Category) at the Ghana Mining
Industry Awards ("GMIA"), an annual event which honours individuals and
organisations that have contributed exceptionally to the growth and
development of the mining industry in Ghana. Atlantic Lithium's receipt of the
award demonstrates the Company's sustained exploration success in Ghana and
the significant role the Company holds in leading the country's long-term
lithium production ambitions.
Figure 5: Key members of the Atlantic Lithium team in Ghana
present to receive the Best Performer in Exploration Award
Inaugural Community Consultative Committee ("CCC") meeting
The Company announced during the period that, in October 2023, it had held its
inaugural meeting for the Community Consultative Committee ("CCC"), which
comprises representatives of the communities surrounding the Project area, in
Saltpond, Ghana's Mfantseman Municipality.
The CCC was established to enable transparent discussion to maximise the value
of the Project for the local population. The meeting provided an occasion for
the local community to express its ongoing support for the Project.
Figure 6: Inaugural meeting of the Community Consultative Committee, held in Saltpond
Ewoyaa Lithium Project Key Stakeholder Documentary
During the period, the Company was pleased to release a stakeholder
documentary entitled, "Driving Generational Change for Ghana", in which a
number of representatives of the communities living within close proximity to
the Project voiced their support for the advancement of the Project,
highlighting the significant benefits that Ewoyaa is expected to bring to the
Central Region and to Ghana.
The video can be found on the Company's website or via its social media
channels, including on YouTube via the following link:
https://www.youtube.com/watch?v=Y9KfP-rca5E
(https://www.youtube.com/watch?v=Y9KfP-rca5E)
Figure 7: Stakeholder documentary interviewees Hon. Ike Lord
Enu, Mfanseman Municipal Chief Executive (left) Francis Odoom, Chairman of the
Trade Union Congress (right), who presented the Company with a certificate of
appreciation for its contribution towards the 2023 Central Region May Day
celebrations in Saltpond
Share Capital Changes - Ordinary Shares, Options and Performance Rights
On 15 December 2023, A$8.0m was raised from an institutional share placement
at a price of A$0.44 per new share. A total of 18,181,819 new fully paid
ordinary shares of no-par value each in the Company was issued.
On 27 December 2023, 9,298,935 performance rights over new ordinary shares of
no-par value each were issued to directors and executives of the Company.
On 24 January 2024, 19,245,574 fully paid ordinary shares of US$0.2598
(A$0.39) were issued as a result of a subscription for shares by the Minerals
Income Investment Fund of Ghana.
On 24 January 2024, 9,622,787 unlisted options were granted to Minerals Income
Investment Fund of Ghana with an exercise price of US$0.3637 and an expiry
date of 23 July 2025.
A summary of movement and balances of equity securities between 1 October 2023
and the date of this report is as follows:
Ordinary Shares Unquoted Options Unquoted performance rights
On issue at start of Quarter 612,241,660 32,650,000 -
Shares issued - Institutional placement (15 December 2023) 18,181,819
Shares issued to Minerals Income Investment Fund of Ghana (24 January 2024) 19,245,574
Unlisted options issued to Minerals Income Investment Fund of Ghana (24 9,622,787
January 2024)
Performance Rights Granted (27 December 2023) 9,298,935
Total Securities on issue at date of this report 649,669,053 42,272,787 9,298,935
Compliance
During the quarter, the Company spent A$7.4m on its exploration, feasibility,
and development activities for its Ewoyaa Lithium Project in Ghana. In
accordance with the agreement announced on 1 July 2021, exploration and
feasibility activities are 50% funded by Piedmont, with Piedmont sole funding
the first US$70m towards the total US$185m of development expenditure
forecasted in the DFS for the Project. Funding is shared equally thereafter.
Appendix 5B expenditure disclosure
As at end 31 December 2023, the Company had cash resources of A$9.8m and no
debt. Exploration and evaluation cash expenditure on the Project during the
quarter was A$7.4m. Piedmont Lithium Inc. funded A$3.9m in the quarter.
Appendix 5B
Mining exploration entity or oil and gas exploration entity
quarterly cash flow report
Name of entity
ATLANTIC LITHIUM LIMITED
ABN Quarter ended ("current quarter")
17 127 215 132 31 December 2023
Consolidated statement of cash flows Current quarter Year to date (6 months)
$A'000
$A'000
1. Cash flows from operating activities - -
1.1 Receipts from customers
1.2 Payments for - -
(a) exploration & evaluation
(b) development - -
(c) production - -
(d) staff costs (1,728) (2,117)
(e) administration and corporate costs (2,740) (4,327)
1.3 Dividends received (see note 3) - -
1.4 Interest received - -
1.5 Interest and other costs of finance paid - -
1.6 Income taxes paid - -
1.7 Government grants and tax incentives - -
1.8 Other - -
1.9 Net cash from / (used in) operating activities (4,468) (6,444)
2. Cash flows from investing activities - -
2.1 Payments to acquire or for:
(a) entities
(b) tenements - -
(c) property, plant and equipment (157) (290)
(d) exploration & evaluation (7,360) (13,314)
(e) investments - -
(f) other non-current assets - -
2.2 Proceeds from the disposal of: - -
(a) entities
(b) tenements 10 10
(c) property, plant and equipment - -
(d) investments - -
(e) other non-current assets - -
2.3 Cash flows from loans to other entities - -
2.4 Dividends received (see note 3) -
2.5 Other - Piedmont Contributions from farm-in arrangement 3,889 6,884
2.6 Net cash from / (used in) investing activities (3,618) (6,710)
3. Cash flows from financing activities 8,000 8,000
3.1 Proceeds from issues of equity securities (excluding convertible debt
securities)
3.2 Proceeds from issue of convertible debt securities - -
3.3 Proceeds from exercise of options - -
3.4 Transaction costs related to issues of equity securities or convertible debt (476) (476)
securities
3.5 Proceeds from borrowings - -
3.6 Repayment of borrowings - -
3.7 Transaction costs related to loans and borrowings - -
3.8 Dividends paid - -
3.9 Other (provide details if material) - -
3.10 Net cash from / (used in) financing activities 7,524 7,524
4. Net increase / (decrease) in cash and cash equivalents for the period
4.1 Cash and cash equivalents at beginning of period 10,565 15,346
4.2 Net cash from / (used in) operating activities (item 1.9 above) (4,468) (6,444)
4.3 Net cash from / (used in) investing activities (item 2.6 above) (3,618) (6,710)
4.4 Net cash from / (used in) financing activities (item 3.10 above) 7,524 7,524
4.5 Effect of movement in exchange rates on cash held (185) 102
4.6 Cash and cash equivalents at end of period 9,818 9,818
5. Reconciliation of cash and cash equivalents Current quarter Previous quarter
at the end of the quarter (as shown in the consolidated statement of cash
$A'000
$A'000
flows) to the related items in the accounts
5.1 Bank balances 9,815 10,561
5.2 Call deposits - -
5.3 Bank overdrafts - -
5.4 Other - Petty Cash 3 4
5.5 Cash and cash equivalents at end of quarter (should equal item 4.6 above) 9,818 10,565
6. Payments to related parties of the entity and their associates Current quarter
$A'000
6.1 Aggregate amount of payments to related parties and their associates included 2,483
in item 1
6.2 Aggregate amount of payments to related parties and their associates included 438
in item 2
6.1 & 6.2 are payments of salaries/bonuses/fees (including superannuation)
to related parties.
7. Financing facilities Total facility amount at quarter end Amount drawn at quarter end
NOTE: the term "facility' includes all forms of financing arrangements
$A'000
$A'000
available to the entity.
Add notes as necessary for an understanding of the sources of finance
available to the entity.
7.1 Loan facilities - -
7.2 Credit standby arrangements - -
7.3 Other - -
7.4 Total financing facilities - -
7.5 Unused financing facilities available at quarter end -
7.6 Include in the box below a description of each facility above, including the
lender, interest rate, maturity date and whether it is secured or unsecured.
If any additional financing facilities have been entered into or are proposed
to be entered into after quarter end, include a note providing details of
those facilities as well.
8. Estimated cash available for future operating activities $A'000
8.1 Net cash from / (used in) operating activities (item 1.9) (4,468)
8.2 (Payments for exploration & evaluation classified as investing activities) (7,360)
(item 2.1(d))
8.3 Total relevant outgoings (item 8.1 + item 8.2) (11,828)
8.4 Cash and cash equivalents at quarter end (item 4.6) 9,818
8.5 Unused finance facilities available at quarter end (item 7.5) -
8.6 Total available funding (item 8.4 + item 8.5) 9,818
8.7 Estimated quarters of funding available (item 8.6 divided by item 8.3) 0.8
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8.8 If item 8.7 is less than 2 quarters, please provide answers to the following
questions:
8.8.1 Does the entity expect that it will continue to have the
current level of net operating cash flows for the time being and, if not, why
not?
Answer: No, for the March quarter steps have been undertaken for capital
preservation so that to continue the development of the Ewoyaa Lithium Project
at a reduced rate of forecast expenditure whilst not jeopardising timelines
towards production.
8.8.2 Has the entity taken any steps, or does it propose to take any
steps, to raise further cash to fund its operations and, if so, what are those
steps and how likely does it believe that they will be successful?
Answer:
· MIIF has subscribed for 19,245,574 shares in Atlantic for consideration
of US$5m on 24 January 2024.
· Atlantic Lithium Ltd is funded under a co-development agreement with
Piedmont Lithium Inc.
· At the end of December 2023, owing by Piedmont was US$3.1m. During
January 2024, Piedmont contributed a total of US$2.96m under the
co-development agreement.
· In addition to the MIIF investment above, Atlantic Lithium has agreed
non-binding Heads of Terms with the Minerals Income Investment Fund of Ghana
("MIIF") to invest in its Ghana subsidiaries. The proposed investment will
support the development of the Project and the broader Cape Coast Lithium
Portfolio in Ghana. Under the terms of the non-binding agreement, MIIF intends
to invest an initial US$27.9m to acquire a 6% contributing interest in the
Company's Ghana Portfolio and will make ongoing contributions through monthly
cash calls as the Project develops.
8.8.3 Does the entity expect to be able to continue its operations
and to meet its business objectives and, if so, on what basis?
Answer: Yes. The company has funding available (see 8.8.2).
NOTE: where item 8.7 is less than 2 quarters, all of questions 8.8.1, 8.8.2
and 8.8.3 above must be answered.
Compliance statement
1 This statement has been prepared in accordance with
accounting standards and policies which comply with Listing Rule 19.11A.
2 This statement gives a true and fair view of the matters
disclosed.
Date: 31 January 2024
Authorised by: Authorised by the Board of Atlantic Lithium Limited
Notes
1. This quarterly cash flow report and the
accompanying activity report provide a basis for informing the market about
the entity's activities for the past quarter, how they have been financed and
the effect this has had on its cash position. An entity that wishes to
disclose additional information over and above the minimum required under the
Listing Rules is encouraged to do so.
2. If this quarterly cash flow report has been
prepared in accordance with Australian Accounting Standards, the definitions
in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral
Resources and AASB 107: Statement of Cash Flows apply to this report. If this
quarterly cash flow report has been prepared in accordance with other
accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the
corresponding equivalent standards apply to this report.
3. Dividends received may be classified either as
cash flows from operating activities or cash flows from investing activities,
depending on the accounting policy of the entity.
4. If this report has been authorised for release
to the market by your board of directors, you can insert here: "By the board".
If it has been authorised for release to the market by a committee of your
board of directors, you can insert here: "By the [name of board committee - eg
Audit and Risk Committee]". If it has been authorised for release to the
market by a disclosure committee, you can insert here: "By the Disclosure
Committee".
5. If this report has been authorised for release
to the market by your board of directors and you wish to hold yourself out as
complying with recommendation 4.2 of the ASX Corporate Governance Council's
Corporate Governance Principles and Recommendations, the board should have
received a declaration from its CEO and CFO that, in their opinion, the
financial records of the entity have been properly maintained, that this
report complies with the appropriate accounting standards and gives a true and
fair view of the cash flows of the entity, and that their opinion has been
formed on the basis of a sound system of risk management and internal control
which is operating effectively.
End note
(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 Ore
Reserves of 25.6Mt @ 1.22% Li(2)O and Production Targets is extracted from the
Ewoyaa Lithium Project Definitive Feasibility Study ("DFS"), announced by the
Company on 29 June 2023, and information in this announcement relating to the
Mineral Resource Estimate ("MRE") of 35.3Mt @ 1.25% Li(2)O for Ewoyaa is
extracted from the Company's announcement dated 1 February 2023, both of which
are available at atlanticlithium.com.au (https://www.atlanticlithium.com.au/)
. The MRE includes a total of 3.5Mt @ 1.37% Li(2)O in the Measured category,
24.5Mt @ 1.25% Li(2)O in the Indicated category and 7.4Mt @ 1.16% Li(2)O in
the Inferred category. The Company confirms that all material assumptions and
technical parameters underpinning the MRE and 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 1 February 2023, 29
June 2023 and 20 October 2023.
(1) Ewoyaa to become one of the top 10 largest spodumene concentrate producers
globally - Based on a comparison of targeted spodumene concentrate production
capacity (ktpa, 100% basis) of select hard rock spodumene projects globally
(refer Company presentation dated 8 September 2023).
Competent Persons
Information in this report relating to the exploration results is based on
data reviewed by Mr Lennard Kolff (MEcon. Geol., BSc. Hons ARSM), Chief
Geologist of the Company. Mr Kolff is a Member of the Australian Institute of
Geoscientists who has in excess of 20 years' experience in mineral exploration
and is a Qualified Person under the AIM Rules. Mr Kolff consents to the
inclusion of the information in the form and context in which it appears.
Information in this report relating to Mineral Resources was compiled by Shaun
Searle, a Member of the Australian Institute of Geoscientists. Mr Searle has
sufficient experience that is relevant to the style of mineralisation and type
of deposit under consideration and to the activity being undertaken to qualify
as a Competent Person as defined in the 2012 Edition of the 'Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves' and
is a Qualified Person under the AIM Rules. Mr Searle is a director of Ashmore.
Ashmore and the Competent Person are independent of the Company and other than
being paid fees for services in compiling this report, neither has any
financial interest (direct or contingent) in the Company. Mr Searle consents
to the inclusion in the report of the matters based upon the information in
the form and context in which it appears.
The reported Ore Reserves have been compiled by Mr Harry Warries. Mr Warries
is a Fellow of the Australasian Institute of Mining and Metallurgy and an
employee of Mining Focus Consultants Pty Ltd. He has sufficient experience,
relevant to the style of mineralisation and type of deposit under
consideration and to the activity he is undertaking, to qualify as a Competent
Person as defined in the 'Australasian Code for Reporting of Mineral Resources
and Ore Reserves' of December 2012 ("JORC Code") as prepared by the Joint Ore
Reserves Committee of the Australasian Institute of Mining and Metallurgy, the
Australian Institute of Geoscientists and the Minerals Council of Australia
and is a Qualified Person under the AIM Rules. Mr Warries gives Atlantic
Lithium Limited consent to use this reserve estimate in reports.
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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