European Metals Managing Director Keith Coughlan commented, “It is very pleasing to receive permission from the relevant Czech authorities to begin our DFS drilling programme. The timing allows us to begin the programme ahead of the winter season and provide an upgrade to the existing resource at Cinovec as part of the DFS -it is encouraging to be able to move quickly into the next stage of development. The drilling of the geotechnical holes for portal design and location has been completed in good time and will be followed by a second programme establishing ground conditions for the mine decline. Dorfner Anzaplan have begun testwork on proving up a flowsheet for the production of lithium hydroxide as announced to the market last month. We expect this work to be very positive for the predicted financial outcomes from the project and look forward to releasing the results.”
European Metals Holdings Limited (LON:EMH) today provided a project update highlighting further significant advancements made in the development of the Cinovec Lithium-Tin Project .
HIGHLIGHTS
· Permits required for the DFS resource drilling campaign have been granted.
· A total of 13 drill holes for a total drilled length of 3,386 metres have been permitted.
· The first 4 geotechnical drill holes at the proposed site of the mine portal have been completed.
· Testing of the revised lithium hydroxide product flowsheet commenced on schedule.
The Company has received permission from the relevant statutory authorities in the Czech Republic for the commencement of the planned comprehensive diamond drilling campaign. The drilling is aimed at converting a sufficient portion of the existing Indicated Mineral Resource to the Measured Resource category to cover the first 2 years of the scheduled mining plan. A total of 8 diamond drill holes will be completed for 2,560 metres. This is a key activity in terms of the ongoing ramp up of the project’s definitive feasibility study (DFS).
A second round of drilling to define Measured Resources to extend coverage to the first 5 years of mining may be undertaken subsequently depending on feedback from on-going discussions with financing entities and their requirements.
The Company is also pleased to report the completion of the initial 4 geotechnical holes reported on 4 September 2018 (CINOVEC PROJECT UPDATE – SIGNIFICANT ADVANCEMENTS), for the portal area. Geotechnical logging of the four holes will be completed by 7 October 2018. The rig is continuing with drilling a further five geotechnical holes along the planned mining decline route to allow final development ready designs to be completed for the portal and decline designs.
The Company can also report that testwork at Dorfner Anzaplan in Germany commenced on schedule. The first stage of the testwork is focused on proving up a flowsheet developed for the production of lithium hydroxide. It is the intention that this work will be followed by locked cycle testing of the flowsheet settled upon.
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 348Mt @ 0.45% Li2O and 0.04% Sn and an Inferred Mineral Resource of 309Mt @ 0.39% Li2O and 0.04% Sn containing a combined 7.0 million tonnes Lithium Carbonate Equivalent and 263kt of tin. An initial Probable Ore Reserve of 34.5Mt @ 0.65% Li2O and 0.09% Sn has been declared to cover the first 20 years mining at an output of 20,800tpa 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%. 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.
