TIDMEMH
RNS Number : 7640U
European Metals Holdings Limited
02 April 2019
For immediate release
2 April 2019
EUROPEAN METALS HOLDINGS LIMITED
CINOVEC PROJECT UPDATE - BATTERY GRADE LITHIUM HYDROXIDE SAMPLE
PRODUCED
HIGHLIGHTS
-- Flowsheet successfully developed and tested for the
production of lithium hydroxide from Cinovec ore.
-- A potential production rate in excess of 25,000 tpa lithium
hydroxide has been demonstrated to be possible utilising a robust
process route proven in the lithium production sector.
-- A formal update of the project PFS reflecting the production
of lithium hydroxide is underway and will be completed within the
next 6 weeks.
European Metals Holdings Limited ("European Metals" or "the
Company") is pleased to provide a project update highlighting the
outcomes from a recently completed engineering assessment of the
flowsheet and subsequent testwork aimed at demonstrating the
ability to produce lithium hydroxide from Cinovec ore. The move by
the company to develop a process for the production of lithium
hydroxide from the Cinovec project is in response to market forces
that continue to move Czech and European manufacturers towards the
production of advanced technology batteries.
The engineering assessment and associated testwork were
conducted on aspects of the hydrometallurgical portion of the
flowsheet of the Preliminary Feasibility Study (PFS) reported on 19
April 2017 (PFS confirms potential low-cost lithium carbonate
producer).
A series of tests were completed in recent months by Dorfner
Anzaplan in Germany looking initially at the direct production of
lithium hydroxide from leach liquors and subsequently testing a
more traditional route of converting lithium carbonate through to
lithium hydroxide.
While both process routes were successful in producing battery
grade lithium hydroxide, assessment of the relevant process risks
indicated that the more robust flowsheet involved the production of
battery grade lithium carbonate followed by conversion to battery
grade lithium hydroxide.
This data is now being used as the foundation for an update of
the PFS such that the final product from the process will be
battery grade lithium hydroxide with the option to produce battery
grade lithium carbonate should the market support both
products.
European Metals MD Keith Coughlan commented, "The clear majority
of European battery producers are indicating a requirement for
lithium input to be supplied as battery grade lithium hydroxide.
The fact that EMH has now demonstrated the ability to produce this
product from Cinovec ore is an exciting development that will
enable the Company to supply its final product into the European
marketplace.
Meeting the European battery market's requirements and
expectations is foremost in our considerations. EMH's next step is
a formal update of the 2017 PFS, the outcomes from which will be
reported shortly."
BACKGROUND INFORMATION ON CINOVEC
PROJECT OVERVIEW
Cinovec Lithium/Tin Project
European Metals, through its wholly owned subsidiary, Geomet
s.r.o., controls the mineral exploration licenses awarded by the
Czech State over the Cinovec Lithium/Tin Project. Cinovec hosts a
globally significant hard rock lithium deposit with a total
Indicated Mineral Resource of 372.4Mt @ 0.45% Li(2) O and 0.04% Sn
and an Inferred Mineral Resource of 323.5Mt @ 0.39% Li(2) O and
0.04% Sn containing a combined 7.18 million tonnes Lithium
Carbonate Equivalent and 263kt of tin reported 28 November 2017
(Further Increase in Indicated Resource at Cinovec South). An
initial Probable Ore Reserve of 34.5Mt @ 0.65% Li(2) O and 0.09% Sn
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 reported 11 July
2018 (Cinovec Production Modelled to Increase to 22,500tpa of
Lithium Carbonate).
This makes Cinovec the largest lithium deposit in Europe, the
fourth largest non-brine deposit in the world and a globally
significant tin resource.
The deposit has previously had over 400,000 tonnes of ore mined
as a trial sub-level open stope underground mining operation.
EMH has completed a Preliminary Feasibility Study, conducted by
specialist independent consultants, which indicated a return post
tax NPV of USD540m and an IRR of 21% reported 19 April 2017 (PFS
Confirms Potential Low Cost Lithium Carbonate Producer). It
confirmed the deposit is amenable to bulk underground mining.
Metallurgical test work has produced both battery grade lithium
carbonate and high-grade tin concentrate 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.
CONTACT
For further information on this update or the Company generally,
please visit our website at www. http://europeanmet.com or
contact:
Mr. Keith Coughlan
Managing Director
COMPETENT PERSON
Information in this release that relates to exploration results
is based on information compiled by Dr Pavel Reichl. Dr Reichl is a
Certified Professional Geologist (certified by the American
Institute of Professional Geologists), a member of the American
Institute of Professional Geologists, a Fellow of the Society of
Economic Geologists and is a Competent Person as defined in the
2012 edition of the Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves and a Qualified Person
for the purposes of the AIM Guidance Note on Mining and Oil &
Gas Companies dated June 2009. Dr Reichl consents to the inclusion
in the release of the matters based on his information in the form
and context in which it appears. Dr Reichl holds CDIs in European
Metals.
The information in this release that relates to Mineral
Resources and Exploration Targets has been compiled by Mr Lynn
Widenbar. Mr Widenbar, who is a Member of the Australasian
Institute of Mining and Metallurgy, 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 consents to the inclusion in this report of
the matters based on his information in the form and context that
the information appears.
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 Convert to Convert to Li(2)
Li Li(2) O CO(3)
------------------- ------- ----------- ----------- -----------------
Lithium Li 1.000 2.153 5.324
Li(2)
Lithium Oxide O 0.464 1.000 2.473
Li(2)
Lithium Carbonate CO3 0.188 0.404 1.000
------------------- ------- ----------- ----------- -----------------
WEBSITE
A copy of this announcement is available from the Company's
website at www.europeanmet.com.
TECHNICAL GLOSSARY
The following is a summary of technical terms:
"ball and rod indices" Indicies that provide an assessment of the
energy required to grind one tonne of material
in a ball or rod mill
"carbonate" refers to a carbonate mineral such as calcite,
CaCO(3)
"comminution" The crushing and/or grinding of material to
a smaller scale
"cut-off grade" lowest grade of mineralised material considered
economic, used in the calculation of Mineral
Resources
"deposit" coherent geological body such as a mineralised
body
"exploration" method by which ore deposits are evaluated
"flotation" selectively separating hydrophobic materials
from hydrophilic materials to upgrade the
concentration of valuable minerals
"g/t" gram per metric tonne
"grade" relative quantity or the percentage of ore
mineral or metal content in an ore body
"heavy liquid separation" is based on the fact that different minerals
have different densities. Thus, if a mixture
of minerals with different densities can
be placed in a liquid with an intermediate
density, the grains with densities less than
that of the liquid will float and grains
with densities greater than the liquid will
sink
"Indicated" or "Indicated as defined in the JORC and SAMREC Codes,
Mineral Resource" is that part of a Mineral Resource which
has been sampled by drill holes, underground
openings or other sampling procedures at
locations that are too widely spaced to ensure
continuity but close enough to give a reasonable
indication of continuity and where geoscientific
data are known with a reasonable degree of
reliability. An Indicated Mineral Resource
will be based on more data and therefore
will be more reliable than an Inferred Mineral
Resource estimate
"Inferred" or "Inferred as defined in the JORC and SAMREC Codes,
Mineral Resource" is that part of a Mineral Resource for which
the tonnage and grade and mineral content
can be estimated with a low level of confidence.
It is inferred from the geological evidence
and has assumed but not verified geological
and/or grade continuity. It is based on information
gathered through the appropriate techniques
from locations such as outcrops, trenches,
pits, working and drill holes which may be
limited or of uncertain quality and reliability
"JORC Code" Joint Ore Reserve Committee Code; the Committee
is convened under the auspices of the Australasian
Institute of Mining and Metallurgy
"kt" thousand tonnes
"LCE" the total equivalent amount of lithium carbonate
(see explanation above entitled Explanation
of Lithium Classification and Conversion Factors)
"LiOH" lithium hydroxide monohydrate (LiOH.H(2) O),
the commercial form of lithium hydroxide
"lithium" a soft, silvery-white metallic element of
the alkali group, the lightest of all metals
"lithium carbonate" the lithium salt of carbonate with the formula
Li(2) CO(3)
"magnetic separation" is a process in which magnetically susceptible
material is extracted from a mixture using
a magnetic force
"metallurgical" describing the science concerned with the
production, purification and properties of
metals and their applications
"Mineral Resource" a concentration or occurrence of material
of intrinsic economic interest in or on the
Earth's crust in such a form that there are
reasonable prospects for the eventual economic
extraction; the location, quantity, grade
geological characteristics and continuity
of a mineral resource are known, estimated
or interpreted from specific geological evidence
and knowledge; mineral resources are sub-divided
into Inferred, Indicated and Measured categories
"mineralisation" process of formation and concentration of
elements and their chemical compounds within
a mass or body of rock
"Mt" million tonnes
"optical microscopy" the determination of minerals by observation
through an optical microscope
"ppm" parts per million
"recovery" proportion of valuable material obtained in
the processing of an ore, stated as a percentage
of the material recovered compared with the
total material present
"resources" Measured: a mineral resource intersected and
tested by drill holes, underground openings
or other sampling procedures at locations
which are spaced closely enough to confirm
continuity and where geoscientific data are
reliably known; a measured mineral resource
estimate will be based on a substantial amount
of reliable data, interpretation and evaluation
which allows a clear determination to be made
of shapes, sizes, densities and grades. Indicated:
a mineral resource sampled by drill holes,
underground openings or other sampling procedures
at locations too widely spaced to ensure continuity
but close enough to give a reasonable indication
of continuity and where geoscientific data
are known with a reasonable degree of reliability;
an indicated resource will be based on more
data, and therefore will be more reliable
than an inferred resource estimate. Inferred:
a mineral resource inferred from geoscientific
evidence, underground openings or other sampling
procedures where the lack of data is such
that continuity cannot be predicted with confidence
and where geoscientific data may not be known
with a reasonable level of reliability
"SAGability" testing material to investigate its performance
in a semi-autonomous grinding mill
"spiral concentration" a process that utilises the differential density
of materials to concentrate valuable minerals
"stope" underground excavation within the orebody
where the main production takes place
"t" a metric tonne
"tin" A tetragonal mineral, rare; soft; malleable:
bluish white, found chiefly in cassiterite,
SnO(2)
"treatment" Physical or chemical treatment to extract
the valuable metals/minerals
"tungsten" hard, brittle, white or grey metallic element.
Chemical symbol, W; also known as wolfram
"W" chemical symbol for tungsten
ADDITIONAL GEOLOGICAL TERMS
"apical" relating to, or denoting an apex
"cassiterite" A mineral, tin dioxide, SnO2. Ore of tin with
specific gravity 7
"cupola" A dome-shaped projection at the top of an
igneous intrusion
"dip" the true dip of a plane is the angle it makes
with the horizontal plane
"granite" coarse-grained intrusive igneous rock dominated
by light-coloured minerals, consisting of
about 50% orthoclase, 25% quartz and balance
of plagioclase feldspars and ferromagnesian
silicates
"greisen" A pneumatolitically altered granitic rock
composed largely of quartz, mica, and topaz.
The mica is usually muscovite or lepidolite.
Tourmaline, fluorite, rutile, cassiterite,
and wolframite are common accessory minerals
"igneous" said of a rock or mineral that solidified
from molten or partly molten material, i.e.,
from a magma
"muscovite" also known as potash mica; formula: KAl(2)
(AlSi(3) O(10) )(F,OH)(2) .
"quartz" a mineral composed of silicon dioxide, SiO2
"rhyolite" An igneous, volcanic rock of felsic (silica
rich) composition. Typically >69% SiO(2)
"vein" a tabular deposit of minerals occupying a
fracture, in which particles may grow away
from the walls towards the middle
"wolframite" A mineral, (Fe,Mn)WO(4) ; within the huebnerite-ferberite
series
"zinnwaldite" A mineral, KLiFeAl(AlSi(3) )O(10) (F,OH)(2)
; mica group; basal cleavage; pale violet,
yellowish or greyish brown; in granites, pegmatites,
and greisens
ENQUIRIES:
European Metals Holdings Limited Tel: +61 (0) 419 996 333
Keith Coughlan, Managing Director Email: keith@europeanmet.com
Kiran Morzaria, Non-Executive Tel: +44 (0) 20 7440 0647
Director Tel: +61 (0) 8 6245 2057
Julia Beckett, Company Secretary Email: julia@europeanmet.com
Beaumont Cornish (Nomad & Tel: +44 (0) 20 7628 3396
Broker) Email: corpfin@b-cornish.co.uk
Michael Cornish
Roland Cornish
Joint Broker Tel: +44 (0) 20 7186 9950
Damon Health
Erik Woolgar
Shard Capital
The information contained within this announcement is considered
to be inside information, for the purposes of Article 7 of EU
Regulation 596/2014, prior to its release. The person who arranged
for the release of this announcement on behalf of the Company was
Keith Coughlan, Managing Director.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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