TORONTO, Jan. 11, 2021 /CNW/ - Neo Lithium Corp. ("Neo
Lithium" or the "Company") (TSXV: NLC) (OTCQX: NTTHF) (FSE:NE2)
and its Argentinean subsidiary LIEX SA, is pleased to announce that
it has engaged Worley Chile and Worley Argentina, respectively, to
complete a Definitive Feasibility Study ("DFS")
of its flagship 3Q Project in Catamarca, Argentina. Worley
Argentina and Worley Chile are subsidiaries of Worley Limited
("Worley") (ASX: WOR).
Neo Lithium has engaged Worley to complete a comprehensive DFS
on its flagship, high-grade lithium brine project, 3Q, in
Catamarca, Argentina. The
development strategy focuses on production of 20,000 tonnes per
year of lithium carbonate with the flexibility to expand production
to 40,000 tonnes per year after phase one is completed and
operational. The DFS is scheduled for completion in Q3
2021.
"On the back of CATL's investment and involvement, we are
very pleased to have engaged and be working with Worley who bring a
wealth of lithium knowledge and experience to our 3Q Project.
Worley is a leading global engineering firm and has been involved
in all aspects of lithium brine operations which will be invaluable
in executing our DFS," said Gabriel Pindar, COO of Neo Lithium
Corp. "We have a very busy and exciting year ahead of us and look
forward to reporting further positive developments to all of our
stakeholders."
Results of the last pre-feasibility study ("PFS") performed by
GHD Chile SA ("GHD") and Groundwater Insight Inc. were filed on
May 8, 2019 for a project with 20,000
tonnes of lithium carbonate production annually with an after-tax
Net Present Value (8% discount rate) of US$1.143 billion, Internal Rate of Return of
49.9%, Capital Expenditures of US$318.9
million, Operating Expenses of US$2,912 per tonne of lithium carbonate, and a
pay-back of twenty months using a lithium carbonate price of
US$11,882 per tonne over a
thirty-five year mine life. The studies carried out by the Company
in its evaporation pilot plant at the salar site and the lithium
carbonate pilot plant in the town of Fiambalá confirm that the
general parameters defined in the PFS will be validated in the
DFS.
The last Reserve Estimation issued on our PFS is summarized
below:
Year
|
Brine
Volume
(Mm3) ***
|
Average Li
concentration
(mg/l) ***
|
Li metal
(tonnes)
|
Lithium
Carbonate
|
Resources*
(%)
|
Proven
|
Probable
|
Proven
|
Probable
|
1
|
3.3
|
1,177
|
1,113
|
2,542
|
5,923
|
13,526
|
0.5%
|
2-10
|
73
|
1,000
|
21,549
|
44,038
|
114,642
|
234,282
|
9%
|
11-20
|
101
|
841
|
20,211
|
53,472
|
107,524
|
284,472
|
10%
|
21-35
|
183
|
670
|
18,694
|
81,513
|
99,453
|
433,651
|
13%
|
Total 35
years
production**
|
360
|
790
|
61,600
|
182,000
|
328,000
|
966,000
|
32
%
|
*Total M&I
resources 4,005,000 tonnes of lithium carbonate @ 400 mg/l cut-off
/ ** Rounded / *** These two include some incidental capture from
the inferred resource, which is excluded from the reserve
estimate.
|
This reserve will be updated because two new wells yielding 160
meters with 1,128 mg/l Lithium (PB1-R-24) and 178 meters 1,117 mg/l
Lithium (PB1-R-25) were reported in June
2019, after the PFS was issued. The wells are outside the
previously considered ore body and therefore it is expected to have
a positive effect in the previously estimated resource and
reserve.
The decision to complete a DFS has been made in collaboration
with Contemporary Amperex Technology Co. Ltd. ("CATL"), the
Company's 8% shareholder, who will also participate in all
technical decisions. Neo Lithium has been operating pilot
evaporation ponds for more than three years, while the pilot
lithium carbonate plant has been in operation for nearly two years.
This has resulted in a meaningful ramp up in knowledge while
improving the process all the way through to validate the PFS and
take the project more efficiently into DFS with a view towards
future construction. As a result of our efforts to maintain steady
operations at pilot scale level, we continue to produce our own
lithium brine concentrate and lithium carbonate on a regular basis,
and believe that we are on track towards our goal of being in
production by the later stages of 2023.
The COVID-19 situation in Argentina has been improving the last weeks
with the arrival of warmer weather but a second wave of COVID-19
could affect the abovementioned timeline. The Company has taken all
the required measures to minimise any impact to the project and
look after its people.
Market Conditions
Due to resurgence of lithium
iron-phosphate (LFP) batteries and other battery technologies that
are able to use lithium carbonate in their cathode, lithium
carbonate prices have materially recovered over the past months.
This upward trend is expected to continue during 2021 and beyond.
Spot supply of lithium carbonate battery grade material is very
tight since most capacity has already been allocated on long term
contracts and demand has continued to outpace production of lithium
carbonate battery grade.
The Company believes that this upward trend in pricing will bode
well in its long-term price expectations for its pricing
assumptions on its DFS and more importantly in its continuous
financing strategy negotiations.
About Neo Lithium Corp.
Neo Lithium Corp. has quickly
become a prominent new name in lithium brine development by virtue
of its high quality 3Q Project and experienced team. Neo Lithium is
rapidly advancing its 100% owned 3Q Project - a unique high-grade
lithium brine lake and salar complex in Latin America's "Lithium Triangle".
The 3Q Project is located in the Catamarca Province, the largest
lithium producing area in Argentina covering approximately 35,000 ha
including a salar complex of approximately 16,000 ha.
Additional information regarding Neo Lithium Corp. is available
on SEDAR at www.sedar.com under the Company's profile and at its
website at www.neolithium.ca, including various pictures of ongoing
work at the project.
About Worley
Worley is a global company headquartered
in Australia and our purpose is
delivering a more sustainable world. Worley is a leading global
provider of professional project and asset services in the energy,
chemicals and resources sectors. As a knowledge-based service
provider, we use our knowledge and capabilities to support our
customers to reduce their emissions and move towards a low carbon
future. Worley Limited is listed on the Australian Securities
Exchange (ASX: WOR).
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release. The TSX Venture Exchange Inc. has in no
way approved nor disapproved the contents of this press
release.
Cautionary Note Regarding Forward Looking Statements -
Certain information set forth in this news release may contain
forward-looking statements. Such statements include but are not
limited to, statements as to lithium brine grades at depth being
consistent with surface results, the potential for resource
expansion at depth, the potential of the northern salar sediments,
and deeper sediments, for hosting brine, the ability to proceed to
scoping studies quickly, proceeding with continued work for
additional economic studies the potential for production expansion
in the Company's assessment of the economic potential of the 3Q
Project, that test results are indicative of future results, and
the additional of additional independent directors. Generally,
forward-looking statements can be identified by the use of words
such as "plans", "expects" or "is expected", "scheduled",
"estimates" "intends", "anticipates", "believes", or variations of
such words and phrases, or statements that certain actions, events
or results "can", "may", "could", "would", "should", "might" or
"will", occur or be achieved, or the negative connotations thereof.
These forward-looking statements are subject to numerous risks and
uncertainties, certain of which are beyond the control of the
Company, which could cause the actual results, performance or
achievements of the Company to be materially different from the
future results, performance or achievements expressed or implied by
such statements. These risks include, without limitation, risks
related to failure to obtain adequate financing on a timely basis
and on acceptable terms, political and regulatory risks associated
with mining and exploration activities, including environmental
regulation, risks and uncertainties relating to the interpretation
of drill and sample results, risks related to the uncertainty of
cost and time estimation and the potential for unexpected delays,
costs and expenses, risks related to metal price fluctuations, the
market for lithium products, competition for experienced directors
in the junior mineral exploration and development sector, and other
risks and uncertainties related to the Company's prospects,
properties and business detailed elsewhere in the Company's
disclosure record. Although the Company believes its expectations
are based upon reasonable assumptions and has attempted to identify
important factors that could cause actual actions, events or
results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended and undue reliance should not be placed on forward-looking
statements.
SOURCE Neo Lithium Corp.