REG - Zinnwald Lithium PLC - Operational Update

Zinnwald LithiumAnnouncement

28/01/2025 07:00

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RNS Number : 8394U  Zinnwald Lithium PLC  28 January 2025

Prior to publication, the information contained within this announcement was
deemed by the Company to constitute inside information as stipulated under the
UK Market Abuse Regulation. With the publication of this announcement, this
information is now considered to be in the public domain.

 

Zinnwald Lithium plc / EPIC: ZNWD.L / Market: AIM / Sector: Mining

28 January 2025

Zinnwald Lithium plc ('Zinnwald Lithium' or the 'Company')

 

Operational Update

 

Advancing the EU's Second Largest Hard-Rock Lithium Project

 

Zinnwald Lithium plc, the European focused lithium company developing the
integrated Zinnwald Lithium Project (the 'Project') in Germany, is pleased to
provide an operational update on recent activities.

 

HIGHLIGHTS

·    The PFS remains on track to be published in Q1 2025.

·    Detailed mine plan finalised to deliver increased production
scenarios, following the publication of an updated Mineral Resource Estimate
('MRE') in June 2024.

·   Metso process engineering and design work in final stages following
completion of mineral processing basic engineering and the key calcination,
and hydrometallurgical testwork programmes.

·      Site layout design and infrastructure completed indicating
sufficient supply of key utilities.

·    The geotechnical drill programme has been completed as part of
detailed planning for constructing an exploration adit to access the Zinnwald
orebody.

·      Advancing environmental licencing and permitting, with updates to
the spatial planning process submitted to Landesdirektion Sachsen.

·      ERM contracted to provide the Environmental and Social Impact
Assessment ('ESIA') Scoping Study.

·     LOI signed with solar development company Solar-Bau to explore the
option for long term clean power offtake.

·    New CDU-SPD coalition agreement in Saxony highlights the raw material
industry as critical to the region's economy, prioritising the simplification
and acceleration of mining project approvals, with the Zinnwald Lithium
Project being the only project formally referenced.

 

Zinnwald Lithium CEO, Anton du Plessis, commented: "Our Zinnwald Lithium
Project is making significant strides towards becoming a cornerstone of
Europe's battery supply chain. With the PFS on track to be published in Q1
2025, we are progressing on all fronts, from optimising mine planning and
advancing metallurgical testwork to collaborating on solar power solutions to
minimise environmental impact. These milestones, combined with strong
partnerships, local government support and ongoing stakeholder engagement,
position us to deliver lithium hydroxide at scale, essential for Europe's
green energy transition and raw material security."

 

DETAILS

Zinnwald Lithium continues to make significant progress in the development of
its integrated lithium hydroxide ('LiOH') project in Germany, which is the
second largest hard-rock lithium project in the EU.

 

Pre-Feasibility Study ("PFS")

Following the completion of the revised Mineral Resource Estimate ('MRE') in
June 2024, Zinnwald Lithium has been advancing its PFS, which remains on track
to be published in Q1 2025.

 

Having completed detailed mine planning, the work is now focused on
preparation of the Reserve Statement. The potential of the ore body to support
larger scale mining in the future has also been evaluated and incorporated
into the PFS.

 

Based on representative samples generated from its exploration programme,
including both high grade greisen and albite granite ore types found in the
deposit, the Company has continued its mineral processing, calcination and
hydrometallurgical testwork programmes. These have been undertaken by Metso, a
frontrunner in sustainable technologies, end-to-end solutions and services for
the aggregates, minerals processing and metals refining industries globally.

 

The Basic Engineering for the mineral processing circuit was completed to a
level of accuracy consistent with a definitive feasibility standard. As noted
in the Company's interim results, the mineral processing flowsheet and
equipment selected is a simple, proven, mainstream modular design that can be
scaled for increased production levels if required.

 

With regard to pyro-metallurgy, calcination testwork has been successfully
concluded at Metso's facility in York, Pennsylvania and equipment selection
has been confirmed. Basic Engineering is well advanced.

 

Hydrometallurgical testwork is also nearing completion. Remaining testwork is
primarily focused on refining the treatment of effluent streams and the
production of saleable by-products.

 

Site layout and infrastructure planning has been completed in conjunction with
Fichtner, a leading German engineering company. This work indicates that
water, power, and gas supplies available in the area are sufficient to support
the planned operation.

 

Water management and hydrogeology is a critical component of both mine design
and the permitting process. A main operating plan for hydrogeological
monitoring in the Zinnwald area was approved by the Saxony Mining Authority
('SOBA') in November 2024 and is valid until November 2028. This plan outlines
a comprehensive framework for evaluating water resources in the area. It
includes the establishment and operation of monitoring stations for surface
water, groundwater, and mine water, ensuring data collection on water levels,
flow, and quality. In cooperation with Geomet s.r.o., which is the owner of
the Cinovec Project in the Czech Republic, Zinnwald Lithium has contracted
ERM, the largest global pure play sustainability consultancy, to develop a
cross-border hydrogeological model. The model will be used to evaluate the
potential impact of mining operations on the hydrogeology.

 

A geotechnical drill programme was also completed as part of detailed planning
for the construction of an exploration adit to access the Zinnwald ore body.
The exploration adit will provide the opportunity to extract a large-scale
bulk sample to be used for piloting, as well as providing further detailed
information on the ore body.

 

Whilst the Company's primary focus is on the development of its core Zinnwald
Licence, it continues to advance targets on its surrounding 100% owned
prospective exploration licence areas, including Falkenhain, Altenberg,
Bärenstein and Sadisdorf. Work on these licences has mainly involved
relogging and sampling historical data and core. Furthermore, the Company
applied for and received an extension of its Altenberg exploration licence,
which is now valid until 20 February 2027.

 

Sustainability / ESG Matters

Zinnwald Lithium has placed its social license to operate at the heart of its
operations and intrinsic to the Project's future success. Meaningful and
transparent engagement and information disclosure are essential to facilitate
community and stakeholder acceptance.

 

Permitting and Environmental

Zinnwald Lithium continues to collaborate with key stakeholders, such as SOBA,
the Landesdirektion Sachsen (State Directorate responsible for spatial
planning) and local municipal, district, state, and federal authorities. In
December 2024, Zinnwald Lithium submitted updates to its spatial planning
scoping documents for its sites and expects to receive feedback on the
proposed assessments required for its Environmental Impact Assessment ('EIA')
by the end of Q1 2025. This will initiate the submission of its full spatial
planning application. In addition to the ongoing hydrogeological work noted
above, in October 2024, the Project commenced its 12-month baseline flora and
fauna studies at the proposed plant site as part of the EIA process. The
assessment areas were defined by Schulz Umweltplanung and approved by the
lower nature conservation authority.

 

Environmental Social Impact Assessment ('ESIA')

A comprehensive ESIA for the Project will be completed to meet the standards
required by International Financing Institutions ('IFIs'), which are generally
more rigorous and extensive than national permitting requirements. In October
2024, Zinnwald Lithium contracted ERM to provide the initial ESIA Scoping
Study phase. Zinnwald Lithium will issue this Scoping Report to SOBA and
publish it following completion of the PFS for wider stakeholder
participation.

 

Direct stakeholder engagement

Zinnwald Lithium continues to undertake regular engagement with the local
communities directly impacted by the planned site locations and other
stakeholders. The Company has established a physical presence in Altenberg,
providing access for interested parties to obtain information about the
Project. The Company will continue to hold town hall events in the coming
months to provide further details on the development of the Project, its
benefits, and its aim to mitigate impact on the environment and community.

 

Corporate and other Matters

The Company has signed a letter of intent ('LOI') with P+S Projektentwicklung
Solar-Bau GmbH ('Solar-Bau') to explore the purchase of solar-generated power.
Solar-Bau, a solar development company, plans to establish several solar power
generation facilities near the Project. This partnership could therefore
minimise environmental impact by using solar energy close to its source,
thereby reducing energy transfer losses and infrastructure costs, while
providing Zinnwald Lithium with a clean energy source to lower the CO(2)
content of its final product.

 

In August 2024, Zinnwald Lithium applied for Critical Raw Materials Act
("CRMA") strategic project designation under the Extraction and Processing
categories. The European Commission ('EC') has confirmed the application has
passed the initial evaluation stage and anticipates informing applicants of
the final outcome in March 2025, following the high number of applications
(170 in total, of which 121 were from within the EU). Zinnwald Lithium
believes the Project meets the criteria for recognition as a Strategic
Project, given its significant contribution to LiOH production in the EU, its
resource scale, feasibility, sustainability credentials and broader EU
benefits.

 

As announced on 27 June 2024, Zinnwald Lithium was invited to apply for Phase
2 of the Temporary Crisis and Transition Framework ('TCTF') grant programme to
support Germany's battery cell manufacturing ecosystem. The review by the
German Federal Ministry for Economic Affairs and Climate Action is ongoing.
While the invitation does not guarantee funding, it acknowledges the Project's
strong potential. Updates will be provided as more information becomes
available. The upcoming general election in Germany on 23 February 2025 may
affect the timeline for decision-making.

 

On 16 December 2024, the Christlich Demokratische Union Deutschlands ('CDU'),
which won the highest individual share of the state elections in September
2024, approved a coalition agreement with the Sozialdemokratische Partei
Deutschlands ('SPD') to form a minority coalition government. Zinnwald Lithium
was delighted that this agreement specifically refers to the importance of the
raw material industry to Saxony and establishes as a key goal the ability to
simplify and speed up the planning and approval of mining projects. The
agreement specifically refers to the Zinnwald Lithium Project in this context
and is the only project formally referenced. Notably, in August and December
2024, Zinnwald Lithium attended meetings with German Federal Chancellor Olaf
Scholz to discuss raw material security and the Project's potential.

 

OUTLOOK

The Company remains on track to publish its PFS during Q1 2025 before further
refining its plans with a Definitive Feasibility Study. To support this, the
Company plans to conduct a large-scale continuous pilot test to refine and
validate the flowsheet design, which will serve as the basis for process
guarantees that are crucial for future financing options.

 

The Company remains well financed with a cash position as at 27 January 2025
of €5.0 million  and the Board looks forward to updating the market on
progress on all of fronts as its various workstreams continue.

 

*ENDS*

 

 For further information visit www.zinnwaldlithium.com
(http://www.zinnwaldlithium.com/)  or contact:

 

 Anton du Plessis       Zinnwald Lithium plc  info@zinnwaldlithium.com (mailto:info@zinnwaldlithium.com)

 Cherif Rifaat
 David Hart             Allenby Capital       +44 (0) 20 3328 5656

 Dan Dearden-Williams   (Nominated Adviser)
 Michael Seabrook       Oberon Capital Ltd    +44 (0) 20 3179 5300

 Adam Pollock           (Joint Broker)
 Richard Greenfield     Tamesis Partner LLP   +44 (0) 20 3882 2868

 Charles Bendon         (Joint Broker)
 Isabel de Salis        St Brides Partners    zinnwald@stbridespartners.co.uk (mailto:zinnwald@stbridespartners.co.uk)

 Paul Dulieu            (Financial PR)

 

Notes

AIM quoted Zinnwald Lithium plc (EPIC: ZNWD.L) is focused on becoming an
important supplier of lithium hydroxide to Europe's fast-growing battery
sector. The Company owns 100% of the Zinnwald Lithium Project in Germany,
which has an approved mining licence, is located in the heart
of Europe's chemical and automotive industries and has the potential to be
one of Europe's more advanced battery grade lithium projects.

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