19 Nov Prospect Resources delivers positive DFS for Zimbabwe lithium project
The Arcadia Lithium Project in Zimbabwe is one step closer to production after Prospect Resources completed a definitive feasibility study (DFS) for the lithium and tantalum resource.
ASX-listed Prospect has forecasted average annual spodumene concentrate production of around 212,000 tonnes, 216,000 tonnes of petalite concentrate and 188,000 pounds of tantalite concentrate over a 12-year mine life.
Outcomes of the DFS on the 2.4 million tonnes (Mt) per annum base case included life of mine revenue of US$2.93 billion (excluding tantalum credits) and average annual profit of $106 million.
The pre-tax net present value at a 10% discount rate is calculated at $511 million, delivering a payback for the project of 2.5 years from first production and an IRR of 44%.
Capital costs for developing the project are estimated at $165 million, with operating costs of $285 per tonne from open-pit mining.
Arcadia is Africa’s second largest undeveloped lithium project with a mineral resource of 43.2 Mt, behind only the Manono project in the Democratic Republic of the Congo.
“This DFS represents a significant milestone for Prospect as we transition into development,” said managing director Sam Hosack. “We are excited by the opportunity to capitalise on the strong fundamentals of the lithium market, initially through the production of lithium concentrates.
“Based on the mine economics and financial strength of the project, we are moving swiftly to finance, develop and commence production at Arcadia.”