Frontier Lithium’s pre-feasibility study on a potential US$1 billion-plus integrated lithium project in Ontario, Canada, contains “more conservative costing assumptions than prior studies, with recent inflationary pressures having a substantial impact on both capital expenditures and operating costs”, the company says.
Toronto-listed Frontier, which has lost about one-third of its market value since February this year, said it was advancing definitely feasibility study and permitting work on the back of its PFS, which outlines a phased approach to openpit mining, spodumene concentrate production and potential lithium chemical refining.
The company has defined two “premium spodumene-bearing lithium deposits [PAK and Spark]”, 2.3km apart, north of Red Lake, with PAK said to be North America’s highest-grade lithium resource and second largest in size with 7.2 million tonnes measured and indicated grading an average 1.8% Li2O outlined so far.
“The PFS confirms that the 100%-owned project could be the continent’s largest and lowest-cost producer of lithium hydroxide able to supply the rapidly growing electric vehicle industry in North America,” Frontier said this week.
The PFS estimates a 4.9-year payback on a US$468 million phase-one operation producing 12,520 tonnes of lithium hydroxide monohydrate (LiOH-H2O) per year and 7360tpa of lithium carbonate at $7433/t lithium carbonate equivalent cash costs. It projects average selling prices of US$22,000/t LiOH-H2O and $20,500/t lithium carbonate.
A chemical grade concentrator and chemical plant could cost a further $576 million.
“We are committed to further optimising the project through definitive feasibility level work,” Frontier CEO Trevor Walker said.
“We are confident that this milestone paves the way for strategic resource development and facilitates deeper discussions with potential offtake partners.”
Frontier said northern Ontario was endowed with exceptional infrastructure, a deep local talent pool, low-cost and low carbon energy, and proximity to an emerging local electric vehicle manufacturing market.
“The North American electric vehicle market is experiencing significant growth, as evidenced by commitments of over C$25 billion to build Ontario battery capacity by 2030,” the company said.
Frontier is currently trading around C$1.95, capitalising the company at $444 million. It was at $2.95 in mid-February this year.