Projects

Authier Lithium Project

Authier Lithium Project

 

Sayona’s Authier Lithium Project is a hard rock spodumene lithium deposit scheduled for development as an open cut mine initially producing a 6% spodumene concentrate. Production is planned to commence in 2020.

 

Sayona Mining acquired 100% of the Authier project in July 2016 for CAD$4 million. The company believes it will create significant share value-uplift for shareholders as the project is advanced towards development. 

The key attractions of the Authier lithium project is its near-term development potential – the company has completed a Definitive Feasibility Study (DFS) and is targeting construction commencing second half 2019 and commissioning second half 2020.

In parallel, studies on producing a premium value-added lithium carbonate product are progressing.

The Authier JORC compliant Mineral Resource estimate is tabulated below at a 0.55% Li20 cut-off grade.

Authier JORC Mineral Resource Estimate (0.55% Li2O cut-off grade)
CategoryTonnes (Mt)Grades % Li2OContained Li2O
TOTAL20.941.01%211,000
Measured Resource6.581.02%67,100
Indicated Resource10.601.01%107,100
Measured + Indicated Resource17.181.01%174,200
Inferred Resource3.760.98%36,800

 

Definitive Feasibility Study demonstrates technical and economic viability.

The DFS, completed in September 2018, has confirmed the Authier Project’s viability as a profitable and sustainable new lithium mine that will provide new jobs, investment and strong returns for all stakeholders.

  • Updated Resource and Reserve estimates – JORC Ore Reserves totalling 12.10Mt @ 0.55% Li20 and
  • JORC Mineral Resource expanded to 20.94MT @ 0.55% Li20.
  • Simple deposit and processing – resources defined in one spodumene bearing pegmatite based on 31,000 metres of diamond drilling. Deposit amenable to low-cost open pit mining techniques. Processing based on a conventional crush, grind and flotation flowsheet.
  • Excellent infrastructure – situated in close proximity to mining support services, low-cost electricity, gas, and road networks to export ports.

The company’s strategy is to initially develop Authier and sell lithium concentrates whilst it completes the test work and feasibility study for a downstream processing facility. Sayona has previously completed a scoping study, demonstrating the economic viability of building a lithium carbonate and/or hydroxide production conversion facility to enhance the project value, and improve the long-term competitive position of the project. A test work programme is currently underway at SGS Canada Inc. in Lakefield, Ontario, to produce lithium carbonate and hydroxide from Authier spodumene concentrate. The results will be incorporated into a pre-feasibility study for a downstream processing plant.

Definitive Feasibility Study highlights

DescriptionUnitResults
Average Annual Ore Feed to the Planttonnes675,000
Annual Average Spodumene Productiontonnes87,400
Life-of-Mineyears18
Life-of-Mine Strip Ratiowaste to ore6.9:1
Average Spodumene PriceUS$/tonne675
Development Capital CostsC$ million89.9
Total Life of Mine Capital CostsC$ million83.6
Total Net Revenue (real terms)C$ million1.394
Total Project EBITDA (real terms)C$ million460
Average Life of Mine Cash Costs (Mine-gate)C$/tonne416
Average Life of Mine Cash Costs (Montreal Port FOB basis)C$/tonne482
Net Present Value (real terms @ 8% discount rate)C$ million184.8
Pre-Tax Internal Rate of Return%33.7
Project Payback Periodyears2.6
Exchange RateCAD : USD0.76

Mineral Rights

The project area comprises 19 mineral claims totalling 653 hectares, and extends 3.4 kilometres in an east-west, and 3.1 kilometres in a north-south direction, respectively. The mineral claims are located over Crown Lands.

Location

The Authier project is situated 45 kilometres northwest of the city of Val d’Or, a major mining service centre in the, Province of Quebec. Val d’Or is located approximately 466 kilometres north-east of Montreal. The project is easily accessed by a rural road network connecting to a national highway a few kilometres east of the project site.

Regional Infrastructure

Val d’Or and other nearby cities have experienced mining work forces and other mining related support services. Regional support services, include:

  • 5 kilometres by dirt road to a sealed highway connecting to Val d’Or;
  • 5 kilometres from an electricity grid supplied by hydro-electric power; and
  • 20 kilometres to rail facilities connecting to an export port.
 
Mineralisation

The deposit is hosted in a spodumene-bearing pegmatite intrusion. The deposit is 825 metres long, striking east-west, with an average thickness of 25 metres, minimum 4 metres and maximum 55 metres, dipping at 40 degrees to the north. The current pit optimisation has the mineralisation extending down to 200 metres depth but the deposit remains open in all directions.

 


Isometric views of the Authier pit with the mineralised envelope on the left from the February 2017 PFS

 
Historical Drilling

The Authier project has been subject to more than 31,000 metres of drilling. Between 2010 and 2012 Glen Eagle, the previous tenement holder, completed 8,990 metres of diamond drilling in 69 diamond drill holes (DDH) of which 7,959 metres were drilled on the Authier deposit; 609 metres (five DDH) were drilled on the northwest and 422 metres on the south-southwest of the property.

Sayona Mining has completed three phases of drilling totalling more than 11,000 metres in 81 DDH. All the holes completed by Sayona and included in the Mineral Resource Estimate have used standard DDH, HQ or NQ core diameter size, using a standard tube and bit. The drilling programmes have been subject to very robust QA/QC procedures.

 

The Mineral Resource has been estimated and reported in accordance with the guidelines of the Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code 2012). A summary of the estimation methodology and competent person statement is included in this announcement.

The Company believes there is further potential to optimise the main resource area including:

  • Infill drilling within the main deposit where there is no resource due to lack of drilling density (shown as block circles on Figure 1), especially in the east and west, and to add the resource base; and
  • Converting inferred resources into a higher resource classifications by further higher density drilling (shown as blue on the diagram).

Black circles represent areas where further density of drilling is required to increase the resource. Additionally, some of the blue Inferred Resource areas have the potential to be converted to higher resource categories with further drilling

 

The mineralisation remains open in all directions (see Figure below). Currently, the Company is not looking to expand the current Mineral Resource estimate given the current resource provides more than 20 years mine life. However, future target areas to expand the resource could include:

  • Testing for further mineralisation in the east and west strike extensions;
  • Defining further mineralisation at depth; and
  • Assessing the resource potential of Authier North.

Lithium solid showing the location of all the historical drill holes and the potential areas for expansion of the resource in future drilling programs.

 

Environmental, Community and First Nations

Environmental Baseline Studies were completed in October 2017 for the Authier project. Additional studies were undertaken in May and June 2018 to complete information required based on the change of the location of some infrastructure.

In May 2018, the company delivered its Environmental Assessment Study (EAS) that presented the results of the baseline studies (physical, biological and social environment), the project description and the effect of the project on the environment. These were updated for the DFS and resubmitted. Mitigation measures and environmental follow-ups were also presented

A Community Relations Programme has been developed to approach and engage local stakeholders. This programme includes information sessions and consultations with municipalities, landowners, First Nations communities, non-governmental environmental organisations and recreational associations.

The objective of this programme was to provide baseline information to address some of the communities’ concerns and take them into consideration in the permitting process and in the design of the operation phase. The involvement of stakeholders will continue throughout the various project stages.

In addition, the company has been engaging with the broader community outside the immediate project area. Meetings have been held with regional councils, other mining companies successfully operating in the region, Government organisations, and other key business stakeholders in the region.

At the same time, the closure plan has been completed and submitted to the Ministry of Energy and Natural Resources (MERN) for public consultation.

The results of the EAS showed that the project will have no impact on the water quality of the Esker Saint-Mathieu-Berry, a local source of potable water, and that any other impacts arising from the operations will be low after the application of mitigation measures.

 
Permittting

The company is currently continuing its consultation process to comply with the permitting process required by both the MERN and the Ministry of Sustainable Development, Environment and the Fight against Climate Change (MDDELCC).

A Mining Lease will be granted only when the following conditions are fulfilled:

  • Completion of a feasibility study (complete);
  • Completion of a scoping and marketing study for processing within Quebec (in progress);
  • Rehabilitation and restoration plans have been approved; (submitted for approval)
  • The MDDELCC authorisation required under the Environment Quality Act has been issued for the project (in progress); and
  • A survey plan has been formalised by the Office of the Surveyor-General of Québec. (Submitted for assessment)

Before a Mining Lease can be granted for a metal mine project where the mine has a production capacity of less than 2,000 metric tons per day, a public consultation initiated by the proponent must be held in the region in which the mine will be located.

The company has now facilitated five public consultation sessions and more than 40 information meetings with different stakeholders located near the project including the La Motte Council and the Abitibiwinni First Nations community. Further information sessions are planned during follow-up meetings in late 2018. The purpose of the meetings is to present the results of the environmental studies and address any stakeholder concerns about the project

Sayona is confident that all necessary approvals can be achieved within the planned development timetable.

Project Implementation

The Company’s project development plan encompasses the following activities:

  • Detailed engineering;
  • Procurement and ordering of long lead items;
  • Completion of environmental and Mining Lease permitting;
  • Community and First Nations consultation;
  • Binding off-take agreements;
  • Finance; and
  • Construction and commissioning.

Sayona is targeting construction commencing second half 2019 and commissioning second half 2020.

The company’s strategy is to initially develop Authier and sell lithium concentrates whilst it completes the test work and feasibility study for a downstream processing facility. Sayona has previously completed a scoping study, demonstrating the economic viability of building a lithium carbonate and/or hydroxide production conversion facility to enhance the project value, and improve the long-term competitive position of the project. A test work programme is currently underway at SGS Canada Inc. in Lakefield, Ontario, to produce lithium carbonate and hydroxide from Authier spodumene concentrate. The results will be incorporated into a pre-feasibility study for a downstream processing plant.

 

Tansim Project

In January 2018, Sayona announced the expansion of its Canadian lithium footprint with the staged acquisition of the Tansim lithium exploration project, 82 kilometres south west of the Authier project in Quebec.

The project comprises 65 mineral claims of 12,000 hectares and is prospective for lithium, tantalum, and beryllium.

Activities to date comprised reinterpretation of historic geophysical data, an airborne geophysics survey, surface mapping and sampling of the pegmatites to define drilling targets.

Exploration is being closely coordinated with the local First Nations group, Long Point First Nation, who will provide support services for the future work programmes.

 

The Lithium Market

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SAYONA MINING LIMITED

+61 7 3369 7058
info@sayonamining.com.au
Suite 68, 283 Given Tce, Paddington QLD 4064
PO Box 1357, Milton QLD 4064

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