Latin Resources has taken a significant step into the global realm of lithium exploration by pumping up the resource at its still-growing Salinas project in Brazil to 70.3 million tonnes going 1.27 per cent lithium oxide.
The enhanced figure includes a 41 per cent increase to its Colina deposit resource, which now sits at more than 63 million tonnes grading 1.3 per cent lithium oxide – and with an expansion program planned for next year. It also features a maiden resource estimate for its Fog’s Block operation of 6.8 million tonnes at 0.9 per cent lithium oxide.
Management says the substantial increase of the overall resource at Salinas will have a positive effect on the economics of its definitive feasibility study (DFS) that is due for completion mid-next year.
The new numbers are impressive given Latin earlier this year revealed a massive 241 per cent increase to its Colina mineral resource up to 45.2 million tonnes at 1.34 per cent lithium oxide, representing a lithium carbonate equivalent of 1.477 million tonnes. The June upgrade at the company’s 38,000-hectare, 100 per cent-owned Brazilian project was based on 135 holes for 39,033m of drill core, with the previous December 2022 maiden resource based on 47 holes for 10,528m of drill core.
Its latest results from last month show a peak intercept at Colina of 13.56m reading 2.03 per cent lithium oxide from just 98.44m, with a maximum width of 26.85m going 1.39 per cent lithium oxide from 260.75m. Other headline results include a 15.7m hit at 1.59 per cent lithium oxide from 206.09m, 20.74m grading 1.42 per cent lithium oxide from 335.45m and 17m going 1.55 per cent lithium oxide from 139m.
Latin has also delivered positive assays from its campaign at Fog’s Block, about 12km south-west of Colina, with peak results of 17.52m at 1.48 per cent lithium oxide from 250.58m and 12.6m grading 1.15 per cent lithium oxide from 173.4m.
The initial preliminary economic assessment (PEA) mining plan for Salinas predicted phase-one production would kick off in 2026, with an expected phase-two average production set to begin in 2029. The increase of the mineral resource will now include a phase-three extension and expansion to production, which will be evaluated in the DFS.
The increase in size of the JORC resource will have an extremely positive impact on our DFS economics as the resource increase allows us to evaluate building phase 3 of the project lifting output significantly. The lithium market sentiment is low at the moment, however, no-one can say Latin hasn’t delivered what it has promised over the last 2 years. Latin Resources managing director Chris Gale
Gale also said the consistent uplift in grade through infill drilling reflected a quality mineral resource. The company’s vice president of operations (Americas) Tony Greenaway was adamant the overall resource would soon grow further to beyond 80 million tonnes, making Salinas “one of the largest global lithium projects”.
In August, Latin proved it was able to produce a 5.5 per cent lithium oxide concentrate from the Colina deposit, with a 93.1 per cent recovery rate. Management says the results are a reliable indication of the potential for simple and cost-effective commercial lithium production by using the dense media separation (DMS) process.
The company used a DMS pilot plant to beneficiate spodumene from waste and says the outcome proved up a reliable indication of the method’s commercial potential. It says the grade of the produced concentrate and the “impressive” recovery rate proves the ability of Colina ore to be produced using a DMS-only flowsheet.
In September, Latin put the finishing touches to a preliminary economic assessment (PEA) that outlined an after-tax average annual free cash flow of US$383 million (AU$601 million) in a mine life of 11 years. The PEA – which is similar in nature to an Australian JORC scoping study – forecast an after-tax net present value of US$2.5 billion (AU$3.6 billion), with an extraordinary internal rate of return of 132 per cent, in addition to a remarkable after-tax project payback period of about seven months.
With a 70-million-tonne resource and further expansion planned, including at the recently-discovered Planalto prospect about 1.8km south-west of the Colina deposit, Latin is in the box seat to deliver a producing operation at one of Brazil’s most promising lithium districts.
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