CleanTech Lithium scoping study confirms strong economics for its Chilean lithium project
( ), a Chile-focused lithium explorer, released results of the recently completed scoping study for its Laguna Verde Project in South America's lithium triangle.
The study estimated an annual production of 20,000 tonnes of battery-grade lithium carbonate for an operational life of 30 years based on measured + indicated resource.
Accumulated net cashflows of US$6.3bn were calculated over the operational life of the project, with an operating cost of US$3,875/tonne of lithium carbonate. Capex was estimated at US$383.6m, based on CleanTech's direct lithium extraction (DLE) plant.
Overall, the study returned an attractive economic outlook for the project, with a post-tax NPV of US$1.83bn using a discount rate of 8%, post-tax IRR of 45.1% and a payback period of 1 year and 8 months, based on a long-term lithium carbonate price of US$22,500 per tonne from 2027.
Aldo Boitano, CEO, commented: "The Scoping Study provides added confidence in the robust economics of the Laguna Verde project; based on low operating and capital costs, with a post-tax NPV of US$1.83 billion and IRR of 45.1%, and a payback period of 1 year and 8 months. The study further advances the process and technical design concept for the project, with strong ESG principles incorporated at each step. With the completion of this study, the Company is proceeding to a Pre-Feasibility Study (PFS) for the project. The PFS will utilise technical data generated by our planned pilot plant, the DLE unit of which was recently ordered from SunResin, to produce a high level of process design verification for a PFS level study."
View from Vox
This scoping study marks a major milestone for CleanTech Lithium and supports the prospect for Laguna Verde to become a major source of battery-grade lithium to European and US markets, based on direct lithium extraction (DLE) technology.
The scoping study outlines a plan to produce battery-grade lithium with a low environmental footprint using DLE methods, underpinning CleanTech Lithium's excellent ESG credentials.
DLE or direct lithium extraction is a greener method of lithium extraction that minimises aquifer depletion and has a smaller geographical footprint than conventional evaporation brines. In addition to employing DLE methods, CleanTech is committed to using 100% renewable energy in processing LCE, and is therefore an attractive option for clients, investors, and governments that have set net zero goals.
As outlined above, the study reaffirmed the economics of Laguna Verde as a compelling investment case. With an operational life of over 30 years at an estimated 20 tonnes/annum of lithium carbonate from an estimated resource of over 800Mt (measured + indicated), and a total recovery rate of 85.2%, the asset is shaping up to be profitable for years to come.
Further supporting the investment case is a low operating cost of $3,875/tonne and a low capex of US$383.6m, underpinning a post-tax NPV of US$1.83bn and IRR of 45.1%, with a payback period of 1 year and 8 months. The costs are competitive even in comparison with projects using traditional extraction processes (solar evaporation).
Furthermore, the study's evaluation period indicated strong demand and sustained high prices for lithium as demand for EVs continues to increase.
CleanTech's other Chilean asset, Francisco Basin, appears equally promising thus far. In October, CleanTech Lithium reported a maiden JORC resource estimate of 0.53m for Francisco Basin, bringing the total LCE resource across the company's two active projects to over 2 million tonnes LCE. New wells at Francsico Basin should support a significant expansion in the maiden resource estimate this year.
Francsico Basin is currently undergoing its own scoping study, expected to complete in 1Q 2023 with results announced in 1H 2023. This will be followed by data from Laguna Verde's pre-feasibility study, expected in 2H 2023. Production at Laguna Verde is targeted for late 2025.
Regional Map of Laguna Verde and Francisco Basin projects
Based on results so far, CleanTech Lithium is well-positioned for continued growth in 2023. In the short amount of time since IPO in March 2022, CleanTech has moved at a fast pace through its work programmes at Laguna Verde and Francisco Basin, and added a third asset at Llamara. The company has indicated active interest in its projects from potential future offtake partners and said it is in early-stage discussions with companies of "substantial scale", including car manufacturers, trading houses, battery manufacturers, and large miners.
The next step for Laguna Verde is a pre-feasibility study (PFS), to commence immediately and conclude in 2H 2023. The PFS is expected to address conversion of lithium carbonate to a potentially more attractive lithium hydroxide, which will further enhance the value of the project.
Investors should also note; the report assumes commencement of production in 2026, though CleanTech is targeting late 2025.
Follow News & Updates from CleanTech Lithium:
Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.