Ramping up lithium carbonate production is a key part of the qualification process. Pic: via Getty Images
Mining
Anson has ramped up lithium carbonate production from its demonstration plant in Florida to meet demand from potential US offtakers, a clear sign of the deep need for new sources of the battery material.
This is a significant milestone for the company as it has only just started producing battery-grade lithium carbonate using direct lithium extraction (DLE) technology provided by its partner Sunresin to process brines sourced from the Paradox lithium project in Utah.
The region surrounding the project was originally the target of oil drilling in the 1960s, taking place over pressurised brines in a unit of the Pennsylvanian Paradox Formation.
While most of these wells were not analysed for lithium, two wells within 1km of the Paradox project claims returned average lithium values of 500 parts per million (ppm) lithium with a top value of 1,700ppm lithium.
Subsequent work carried out since Anson Resources (ASX:ASN) completed due diligence on the project back in October 2016 has led to the definition of an economically attractive DLE project which seeks to meet growing demand for lithium in North America.
A Definitive Feasibility Study completed last year outlined the project as a low-cost, long-life project with pre-tax net present value and internal rate of return – both measures of a project’s profitability – estimated at US$1,305 million and 47% respectively.
The current resource of 1.04Mt lithium carbonate equivalent and 5.27Mt bromine is more than sufficient to deliver revenues of US$5.08bn over a 23-year mine life.
This is due in no small part to the proposed use of Sunresin’s proven DLE technology, which is already used to produce 32,000tpa of lithium carbonate at seven projects.
Anson is also eyeing a potential resource upgrade once the acquisition of the Green Energy ground, which will add 8% to the land area covered by the Paradox project, is completed.
It could potentially increase the exploration target by 14% to between 310Mt and 350Mt of brine grading 108ppm to 200ppm lithium and 2,000ppm to 3,000ppm bromine.
Anson is now ramping up production at its demonstration plant as a key step in the qualification process with potential offtake partners.
Samples produced from the plant will be provided to vehicle manufactures and cathode active material manufacturers (CAMs) as part of the process to secure long term offtake deals.
Production is expected to reach 1tpa by the end of this year, enough to meet Stage 1 and 2 supply qualification requirements.
“Our qualification process for potential offtake partners is progressing very well,” Anson executive chairman Bruce Richardson said.
“The DLE technology Anson has selected for the Paradox lithium project has been proven commercially, and now we are in the process of providing battery-grade lithium carbonate samples to large vehicle manufactures and their CAM’s in the USA as part of a structured supply qualification process in order to qualify as a supplier to these end-users.
“We are also using this as an opportunity to assess new technologies as they are developed and processed to improve lithium extraction and processing plant efficiencies as part of a continual improvement agenda at our Lithium Innovation Centre.”
Richardson added that it was pleasing to see the fully operational demonstration plant produce samples to support the company’s goal of signing off-take agreements, which in turn are needed for project financing.
Besides the ramp-up of production at the demonstration plant, Anson is closing in on defining a maiden ore reserve – the economically mineable part of a measured and/or indicated mineral resource.
Additionally, progress is being made on the approvals process to start production at Paradox with the company nabbing a key air quality approval in early August.
Completion of the detailed Front-End Engineering & Design study (FEED) is also expected soon.
This article was developed in collaboration with Anson Resources, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
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