REG - European Metals Hldg - Successful Battery Grade pilot - Cinovec Project

European Metals HoldingsAnnouncement

09/11/2023 07:00

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RNS Number : 9237S  European Metals Holdings Limited  09 November 2023

For immediate release

9 November 2023

European Metals Holdings Limited

("European Metals" or the "Company")

Successful Battery-Grade pilot programme for Cinovec Lithium Project

European Metals Holdings Limited (ASX & AIM: EMH) ("European Metals" or
the "Company") is pleased to announce the results of the Lithium Chemical
Plant ("LCP") pilot programme, confirming the robustness of the Cinovec LCP
process flowsheet and providing a strong foundation for the execution of the
Cinovec Project.

Highlights

·      Pilot programme has confirmed industrial viability of the LCP
process flowsheet.

·      Exceptionally clean battery grade lithium carbonate (>99.9%)
produced with single-stage purification (bicarbonation) of crude lithium
carbonate.

·      Pilot programme crude lithium carbonate confirmed at 99.7%
purity, greater than battery grade (99.5%) in the carbonate precipitation step
without any additional processing.

·      Work to produce battery grade lithium hydroxide monohydrate is
underway.

·      The pilot programme processed ore fully-representative in all
respects of the run-of-mine for the first seven years of mining planned at
Cinovec, including average grade and expected rock-type mix from the bulk
mining.

Executive Chairman, Keith Coughlan, said:

"The confirmation of the exceptionally clean nature of the Cinovec Lithium
Carbonate resulting from the pilot programme is further proof of the
tremendous importance of the Cinovec Lithium Project for the whole of the
EU.  The Lithium Carbonate produced by the simplified flowsheet has the
ability to be a major contributor to the EU's lithium security.  The Cinovec
Project is well positioned to be a major supplier of battery grade lithium
products to the strategically important European car industry to ensure that
they are able to compete on the global stage.

The pilot programme data is now being used to confirm design and engineering
for the ongoing Definitive Feasibility Study (DFS) being completed by DRA
Global and which remains on-track for completion in the current quarter, and
also for the post-DFS detailed design.

European Metals, in developing the Cinovec Lithium Project, is well positioned
for the rising demand in battery materials in the EU. The Cinovec project is
the largest hard rock lithium project in the EU and Europe as a whole and is
centrally located on the Czech Republic's border with Germany."

Pilot Programme

The pilot programme, which took place at ALS Laboratories in Perth, WA, set
out to confirm the LCP flowsheet which was the subject of the Company's
ASX/AIM announcement of 31 October 2022 "Simplified Extraction Process
delivers exceptionally-clean battery-grade lithium product with improved
economics" and to produce sufficient marketing samples for potential offtakers
to test in their own laboratories.

The pilot programme has achieved these objectives without necessitating any
further development of the LCP process flowsheet.

In doing so, the pilot programme has provided extensive data throughout all of
the LCP process steps. This data contributes to the confirmation of design and
engineering for both the ongoing Definitive Feasibility Study ("DFS") and the
post-DFS execution of the Project.

Next Stage of Development of Cinovec

The DFS for battery-grade Lithium Carbonate remains on-track for completion in
Q4 2023. Subject to confirmation of the pilot programme work for battery grade
Lithium Hydroxide, a decision on the battery grade end-product (carbonate vs
hydroxide) for the Cinovec Project is expected to be made in early 2024. This
will enable design engineering to proceed enabling the Project to come into
production in the shortest possible time frame and includes engagement with
long lead equipment OEMs to ensure that the timeline is expedited. The Company
will update the market as and when appropriate.

High-Grade Lithium End-Products

The LCP flowsheet pilot programme produced the following crude and
battery-grade lithium carbonate products, compared with the published global
standard specification, YS/T 582-2013 and the crude and battery grade lithium
carbonate products produced in the Cinovec locked cycle tests reported in the
Company's ASX/AIM announcement of 31 October 2022 "Simplified Extraction
Process delivers exceptionally-clean battery-grade lithium product with
improved economics".

It can be seen that in respect of the majority of the limits specified by
standard YS/T 582-2013, being the elements or chemical species of interest to
cathode manufacturers, for both the crude and the battery grade lithium
carbonate products, the semi-industrial scale continuously piloted results are
superior to the results from the locked cycle tests which were bench-scale
tests of a batch processing nature.

These results confirm the robustness of the Cinovec LCP process flowsheet and
provide a strong foundation for the execution of the Cinovec Project.

In both the LCT and the piloted battery-grade lithium carbonate, the
end-product was produced in a single bicarbonation step. This places an
important limitation on operational expenditure in the final processing
stages, avoiding the need for repeated bicarbonation steps or for blending of
technical grade lithium carbonate produced with battery grade lithium
carbonate, to just achieve battery grade with an assay average, a common step
in some lithium carbonate plants.

 

                   Li(2)CO(3)  Na    K     Mg    Ca    Mn    Fe    Ni    Cu    Zn    Al    Si    Pb       SO(4)(2)-  Cl

                   %           ppm   ppm   ppm   ppm   ppm   ppm   ppm   ppm   ppm   ppm   ppm   ppm      ppm        ppm
 YS/T              ≥99.5       250   10    80    50    3     10    10    3     3     10    30    3        800        30

 582-2013
 Crude LC          99.4        368   3     5     357   0     8     3.4   0.2   1.2   5.1   26    0        4860       59

 LCTs
 Crude LC          99.7        367   2.8   4.4   53.8  0.1   4.0   0.2   0.1   0.9   0.9   4.1   <0.1     2420       50

 PILOT
 Battery Grade LC  99.9        3     0.8   0.9   2     0.7   6.3   3.4   0.2   1.3   2.8   2.1   0.07     95         <10

 LCTs
 Battery Grade LC  99.9        4.7   0.3   0.5   1.6   1.0   0.7   5.4   0.1   0.5   0.6   2.0   0.05     164        27

 PILOT

 

 

Battery-Grade Lithium Carbonate - Extended Assay Table

The extended assay table presented below includes the 14 elements in the
published lithium carbonate battery-grade standard, YS/T 582-2013, (top table)
together with the further 9 elemental impurities that are important to
minimise for the manufacture of cathodes / batteries (bottom table).

The battery-grade lithium carbonate assays were assessed by LabWest Minerals
Analysis Pty Ltd, Perth.

LabWest was used as it has world-leading detection limits for assaying lithium
chemicals, with detection limits for the assayed elements shown in the tables
below of between 0.01 to 500 ppb (0.00001 to 0.5 ppm).

                   Li(2)CO(3)  Na    K     Mg    Ca    Mn    Fe    Ni    Cu    Zn    Al    Si    Pb    SO(4)(2)-  Cl

                   %           ppm   ppm   ppm   ppm   ppm   ppm   ppm   ppm   ppm   ppm   ppm   ppm   ppm        ppm
 YS/T              ≥99.5       250   10    80    50    3     10    10    3     3     10    30    3     800        30

 582-2013
 Battery Grade LC  99.9        3     0.8   0.9   2     0.7   6.3   3.4   0.2   1.3   2.8   2.1   0.07  95         <10

 LCTs
 Battery Grade LC  99.9        4.7   0.3   0.5   1.6   1.0   0.7   5.4   0.1   0.5   0.6   2.0   0.05  164        27

 PILOT

 

                   As    B     Cr    Cs          F     Mo      P     Rb      Sr

                   ppm   ppm   ppm   ppm         ppm   ppm     ppm   ppm     ppm
 YS/T              NA    NA    NA    NA          NA    NA      NA    NA      NA

 582-2013
 Battery Grade LC  0.17  2.2   0.26  <0.0001     20    0.0518  29.2  0.0026  0.0164

 LCTs
 Battery Grade LC  0.02  2.3   0.10  0.001       5     0.01    124   0.008   0.018

 PILOT

 

This announcement has been approved for release by the Board.

CONTACT

For further information on this update or the Company generally, please visit
our website at www.europeanmet.com (http://www.europeanmet.com) or see full
contact details at the end of this release.

 

BACKGROUND INFORMATION ON CINOVEC

PROJECT OVERVIEW

Cinovec Lithium Project

Geomet s.r.o. controls the mineral exploration licenses awarded by the Czech
State over the Cinovec Lithium Project. Geomet has been granted a preliminary
mining permit by the Ministry of Environment and the Ministry of Industry. The
company is owned 49% by EMH and 51% by CEZ a.s. through its wholly owned
subsidiary, SDAS. Cinovec hosts a globally significant hard rock lithium
deposit with a total Measured Mineral Resource of 53.3Mt at 0.48% Li(2)O,
Indicated Mineral Resource of 360.2Mt at 0.44% Li(2)O and an Inferred Mineral
Resource of 294.7Mt at 0.39% Li(2)O containing a combined 7.39 million tonnes
Lithium Carbonate Equivalent (refer to the Company's ASX/AIM release dated 13
October 2021) (Resource Upgrade at Cinovec Lithium Project).

An initial Probable Ore Reserve of 34.5Mt at 0.65% Li(2)O reported 4 July 2017
(Cinovec Maiden Ore Reserve - Further Information) has been declared to cover
the first 20 years mining at an output of 22,500tpa of lithium carbonate
(refer to the Company's ASX/AIM release dated 11 July 2018) (Cinovec
Production Modelled to Increase to 22,500tpa of Lithium Carbonate).

This makes Cinovec the largest hard rock lithium deposit in Europe and the
fifth largest non-brine deposit in the world.

The deposit has previously had over 400,000 tonnes of ore mined as a trial
sub-level open stope underground mining operation.

On 19 January 2022, EMH provided an update to the 2019 PFS Update, conducted
by specialist independent consultants, which indicates a post-tax NPV of
USD1.938B and a post-tax IRR of 36.3% and confirmed that the Cinovec Project
is a potential low operating cost producer of battery-grade lithium hydroxide
or battery grade lithium carbonate as markets demand. It confirmed the deposit
is amenable to bulk underground mining (refer to the Company's ASX/AIM release
dated 19 January 2022) (PFS Update delivers outstanding results).
Metallurgical test-work has produced both battery-grade lithium hydroxide and
battery-grade lithium carbonate at excellent recoveries. Cinovec is centrally
located for European end-users and is well serviced by infrastructure, with a
sealed road adjacent to the deposit, rail lines located 5 km north and 8 km
south of the deposit, and an active 22 kV transmission line running to the
historic mine. As the deposit lies in an active mining region, it has strong
community support.

The economic viability of Cinovec has been enhanced by the recent strong
increase in demand for lithium globally, and within Europe specifically.

There are no other material changes to the original information and all the
material assumptions continue to apply to the forecasts.

 

BACKGROUND INFORMATION ON CEZ

Headquartered in the Czech Republic, CEZ a.s. is an established, integrated
energy group with operations in a number of Central and South-eastern
European countries and Turkey. CEZ's core business is the generation,
distribution, trade in, and sales of electricity and heat, trade in and sales
of natural gas, and coal extraction. CEZ Group is one of the ten largest
energy companies in Europe, has 28,000 employees and annual revenue of
approximately EUR 9.97 billion.

The largest shareholder of its parent company, CEZ a.s., is the Czech
Republic with a stake of approximately 70%. The shares of CEZ a.s. are traded
on the Prague and Warsaw stock exchanges and included in the PX and WIG-CEE
exchange indices. CEZ's market capitalization is approximately EUR 17.7
billion.

As one of the leading Central European power companies, CEZ intends to develop
several projects in areas of energy storage and battery manufacturing in the
Czech Republic and in Central Europe.

CEZ is also a market leader for E-mobility in the region and has installed and
operates a network of EV charging stations throughout Czech Republic. The
automotive industry in the Czech Republic is a significant contributor to GDP,
and the number of EV's in the country is expected to grow significantly in the
coming years.

COMPETENT PERSONS

Information in this announcement relating to the FECAB metallurgical testwork
is based on technical data compiled or supervised by Mr Walter Mädel, a
full-time employee of Geomet s.r.o a subsidiary of the Company. Mr Mädel is a
member of the Australasian Institute of Mining and Metallurgy (AUSIMM) and a
mineral processing professional with over 27 years of experience in
metallurgical process and project development, process design, project
implementation and operations. Of his experience, at least 5 years have been
specifically focused on hard rock pegmatite Lithium processing development. Mr
Mädel consents to the inclusion in the announcement of the matters based on
this information in the form and context in which it appears.  Mr Mädel is a
participant in the long-term incentive plan of the Company.

Information in this release that relates to exploration results is based on
information compiled by Dr Vojtech Sesulka. Dr Sesulka is a Certified
Professional Geologist (certified by the European Federation of Geologists), a
member of the Czech Association of Economic Geologist, and a Competent Person
as defined in the JORC Code 2012 edition of the Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves. Dr
Sesulka has provided his prior written consent to the inclusion in this report
of the matters based on his information in the form and context in which it
appears. Dr Sesulka is an independent consultant with more than 10 years
working for the EMH or Geomet companies. Dr Sesulka does not own any shares in
the Company and is not a participant in any short- or long-term incentive
plans of the Company.

Mr Grant Harman (B.Sc Chem Eng, B.Com) is an independent consultant with in
excess of 7 years of lithium chemicals experience. Mr Harman supervised and
reviewed the metallurgical test work and the process design criteria and flow
sheets in relation to the LCP.  Mr Harman is a participant in the long-term
incentive plan of the Company.

The information in this release that relates to Mineral Resources and
Exploration Targets is based on, and fairly reflects, information and
supporting documentation prepared by Mr Lynn Widenbar. Mr Widenbar, who is a
Member of the Australasian Institute of Mining and Metallurgy and a Member of
the Australasian Institute of Geoscientists, is a full-time employee of
Widenbar and Associates and produced the estimate based on data and geological
information supplied by European Metals. Mr Widenbar has sufficient experience
that is relevant to the style of mineralisation and type of deposit under
consideration and to the activity that he is undertaking to qualify as a
Competent Person as defined in the JORC Code 2012 Edition of the Australasian
Code for Reporting of Exploration Results, Minerals Resources and Ore
Reserves. Mr Widenbar has provided his prior written consent to the inclusion
in this report of the matters based on his information in the form and context
that the information appears. Mr Widenbar does not own any shares in the
Company and is not a participant in any short- or long-term incentive plans of
the Company.

The Company confirms that it is not aware of any new information or data that
materially affects the information included in the original market
announcement and, in the case of estimates of Mineral Resources or Ore
Reserves, that all material assumptions and technical parameters underpinning
the estimates in the relevant market announcement continue to apply and have
not materially changed. The Company confirms that the form and context in
which the Competent Person's findings are presented have not been materially
modified from the original market announcement.

CAUTION REGARDING FORWARD LOOKING STATEMENTS

Information included in this release constitutes forward-looking statements.
Often, but not always, forward looking statements can generally be identified
by the use of forward looking words such as "may", "will", "expect", "intend",
"plan", "estimate", "anticipate", "continue", and "guidance", or other similar
words and may include, without limitation, statements regarding plans,
strategies and objectives of management, anticipated production or
construction commencement dates and expected costs or production outputs.

Forward looking statements inherently involve known and unknown risks,
uncertainties and other factors that may cause the company's actual results,
performance, and achievements to differ materially from any future results,
performance, or achievements. Relevant factors may include, but are not
limited to, changes in commodity prices, foreign exchange fluctuations and
general economic conditions, increased costs and demand for production inputs,
the speculative nature of exploration and project development, including the
risks of obtaining necessary licences and permits and diminishing quantities
or grades of reserves, political and social risks, changes to the regulatory
framework within which the company operates or may in the future operate,
environmental conditions including extreme weather conditions, recruitment and
retention of personnel, industrial relations issues and litigation.

Forward looking statements are based on the company and its management's good
faith assumptions relating to the financial, market, regulatory and other
relevant environments that will exist and affect the company's business and
operations in the future. The company does not give any assurance that the
assumptions on which forward looking statements are based will prove to be
correct, or that the company's business or operations will not be affected in
any material manner by these or other factors not foreseen or foreseeable by
the company or management or beyond the company's control.

Although the company attempts and has attempted to identify factors that would
cause actual actions, events or results to differ materially from those
disclosed in forward looking statements, there may be other factors that could
cause actual results, performance, achievements or events not to be as
anticipated, estimated or intended, and many events are beyond the reasonable
control of the company. Accordingly, readers are cautioned not to place undue
reliance on forward looking statements. Forward looking statements in these
materials speak only at the date of issue. Subject to any continuing
obligations under applicable law or any relevant stock exchange listing rules,
in providing this information the company does not undertake any obligation to
publicly update or revise any of the forward looking statements or to advise
of any change in events, conditions or circumstances on which any such
statement is based.

LITHIUM CLASSIFICATION AND CONVERSION FACTORS

Lithium grades are normally presented in percentages or parts per million
(ppm). Grades of deposits are also expressed as lithium compounds in
percentages, for example as a percent lithium oxide (Li(2)O) content or
percent lithium carbonate (Li(2)CO(3)) content.

Lithium carbonate equivalent ("LCE") is the industry standard terminology for,
and is equivalent to, Li(2)CO(3). Use of LCE is to provide data comparable
with industry reports and is the total equivalent amount of lithium carbonate,
assuming the lithium content in the deposit is converted to lithium carbonate,
using the conversion rates in the table included below to get an equivalent
Li(2)CO(3) value in percent. Use of LCE assumes 100% recovery and no process
losses in the extraction of Li(2)CO(3) from the deposit.

Lithium resources and reserves are usually presented in tonnes of LCE or Li.

The standard conversion factors are set out in the table below:

Table: Conversion Factors for Lithium Compounds and Minerals

 Convert from                   Convert to Li  Convert to Li(2)O  Convert to Li(2)CO(3)  Convert to LiOH.H(2)O
 Lithium            Li          1.000          2.153              5.325                  6.048
 Lithium Oxide      Li(2)O      0.464          1.000              2.473                  2.809
 Lithium Carbonate  Li(2)CO(3)  0.188          0.404              1.000                  1.136
 Lithium Hydroxide  LiOH.H(2)O  0.165          0.356              0.880                  1.000
 Lithium Fluoride   LiF         0.268          0.576              1.424                  1.618

 

 

WEBSITE

A copy of this announcement is available from the Company's website at
www.europeanmet.com/announcements/ (http://www.europeanmet.com/announcements/)
.

ENQUIRIES:

 European Metals Holdings Limited

 Keith Coughlan, Executive Chairman           Tel: +61 (0) 419 996 333

                                              Email: keith@europeanmet.com (mailto:keith@europeanmet.com)

 Kiran Morzaria, Non-Executive Director       Tel: +44 (0) 20 7440 0647

 Shannon Robinson, Company Secretary          Tel: +61 (0) 418 675 845

                                              Email: shannon@europeanmet.com (mailto:shannon@europeanmet.com)

 WH Ireland Ltd (Nomad & Broker)

 James Joyce / Darshan Patel / Isaac Hooper   Tel: +44 (0) 20 7220 1666

 (Corporate Finance)

 Harry Ansell (Broking)

 Panmure Gordon (UK) Limited (Joint Broker)

 John Prior                                   Tel: +44 (0) 20 7886 2500

 Hugh Rich

 James Sinclair Ford

 Harriette Johnson

 Blytheweigh (Financial PR)                   Tel: +44 (0) 20 7138 3222

 Tim Blythe

 Megan Ray

 Chapter 1 Advisors (Financial PR - Aus)

 David Tasker                                 Tel: +61 (0) 433 112 936

 

The information contained within this announcement is deemed by the Company to
constitute inside information under the Market Abuse Regulation (EU) No.
596/2014 ("MAR") as it forms part of UK domestic law by virtue of the European
Union (Withdrawal) Act 2018 and is disclosed in accordance with the Company's
obligations under Article 17 of MAR.

 

The person who authorised for the release of this announcement on behalf of
the Company was Keith Coughlan, Executive Chairman.

 

 

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