THE BOURSE WHISPERER: AVZ Minerals (ASX: AVZ) released extended results of a Scoping Study for five million tonnes per annum capacity on the company’s Manono lithium and tin project in the Democratic Republic of Congo (DRC).
AVZ Minerals explained the study evaluated the technical, transport, power and potential economic viability of an open pit mine development at the Manono project, where a JORC Mineral Resource of 400 million tonnes of 1.65 per cent lithium oxide (Li2O) has been defined.
All costings and projections in the financial model were prepared on all classifications of resources namely, Measured, Indicated and Inferred Resource tonnages.
Measured and Indicated portions combined, account for approximately 67.25 per cent of the existing Mineral Resource while the Inferred category resources accounts for the remaining 32.75 per cent.
The company said the lower categorised resource provides a lower level of confidence in the figures and reduces the reliability of the estimated returns.
The study considered various processing options to optimise throughput capacity and recoveries, with consideration given to managing early stage cash flow and upfront capital costs.
Mining and processing parameters were investigated at US$750 per tonne selling price (base price based on 5.8 per cent Li20 concentrate).
This scoping study plan is to develop Manono as a 5 million tonnes per annum (Case 2) high-grade open pit mine to supply material to a conventional crushing, high pressure grinding, dense media separation (DMS) and flotation plant.
The estimates presented by the Scoping Study were based on 100 per cent project interest although currently AVZ holds 60 per cent interest in the Manono project.
The 5Mtpa capital costs for the processing plant and associated project infrastructure are estimated at approximately US$380 to US$400M (C5 ±35% and includes US$78M contingency).
“Not only does the results of the five million tonnes per annum (Case 2) study confirm the excellent quality of the Manono project, it further underlines the expandability of the project,” AVZ Minerals managing director Nigel Ferguson said in the company’s announcement to the Australian Securities Exchange.
“Management will now turn its attention to selecting the optimal throughput level in conjunction with consultants working on the DFS.”
AVZ has commenced a Definitive Feasibility Study on the Manono lithium and tin project that is aimed at improving the accuracy of cost estimates and to provide additional definition on the project’s infrastructure requirements such as water, power and transport.
The Resources Roadhouse sat down with AVZ managing director Nigel Ferguson at the recent RIU Sydney Resources Roundup. WATCH THE INTERVIEW HERE