Study consultants DRA Global has placed a whopping AUD$862 million independent net present value on European Lithium’s proposed Wolfsberg Lithium Project in Austria.

Aiming to tap into demand from one of the world’s biggest electric vehicle markets at a time when lithium prices are soaring, European Lithium (ASX:EUR) has divulged the new estimate ahead of a final DFS release in the third quarter of 2022.

While that has been delayed by Covid-19 travel restrictions and the Ukraine conflict, today’s NPV figure today provides investors with a taste of what is to come, among a series of other interim headline numbers EUR has released to the market.

Company chairman Tony Sage pointed to the need to deliver projects like Wolfsberg as Europe aims to pick up the pace of its shift from fossil fuels like coal and gas to renewables.

“Calculation of a positive interim NPV provides confidence in the future commercialisation of the Wolfsberg Project that comes during a buoyant market for lithium and increased urgency for decisive action to accelerate the green energy transition, specifically in Europe,” he said.

The Wolfsberg Lithium Project will be the first mining project in Europe to form part of an integrated supply chain on the continent for the key battery metal.

Wolfsberg will be include underground mining and surface processing of lithium hydroxide. Pic: EUR

Filling the market gap

European Lithium plans to produce 10,500t of lithium hydroxide at a mining rate of 770,000tpa over a maximum period of 20 years, providing a long-term supply of high quality lithium chemicals to the European battery market.

That is an outcome of detailed mechanical and chemical process flow based on complex pilot plant test work and advanced engineering work to deploy the process on an industrial scale, as well as advanced mine scheduling and planning work as part of the DFS.

It comes out of a resource of 9.7Mt at 1% Li2O. 44% of resources incorporated in the production targets are in the measured category, with 56% in the indicated category, the highest standards of resource classification.

European Lithium expects to produce lithium hydroxide at Wolfsberg for up to 20 years. Pic: EUR

EUR also sees a strong market for lithium hydroxide pricing of US$26,800/t. That is very conservative compared to spot prices of ~US$69,000/t being paid at the moment by battery makers.

It sets up the company well for its accelerated production path to become Europe’s first on shore supplier of battery chemicals.

Alongside its AUD$862m NPV figure, other updated numbers for Wolfsberg ahead of the DFS include an increase in capex of 20% to US$508.32m and increase in opex by 20% on the 2018 PFS.

The company anticipates a funding mix of 60% debt to 40% equity to finance the construction of the project.



This article was developed in collaboration with European Lithium, 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.