Name of the Project
Mina do Barroso lithium project.

Location
Near Boticas, northern Portugal.

Project Owner/s
Savannah Resources.

Project Description
A scoping study has confirmed that Mina do Barroso has the potential to be a major European producer of spodumene lithium, with robust project economics and the potential to deliver substantial shareholder value.

The study is considered a base case for the project, and is based on a mine and concentrator-only development for the production of spodumene concentrate.

The project will use a contract miner and fleet.

Conceptual openpit mine planning has been developed, targeting a plant feed rate of 1.3-million tonnes a year, with an estimated average life-of-mine (LoM) mill head grade of 1.02% (diluted) lithium oxide and an average overall strip ratio of 5.2:1 (waste:ore ratio). The project LoM will exceed 11 years.

The flowsheet comprises a combined 1.3-million-tonne-a-year dense-media separation and flotation circuit, with an overall plant availability of 85% for the recovery of spodumene. The study estimates average production of 175 000 t/y of spodumene concentrate at 6% lithium oxide.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at an 8% discount rate, of $356-million and an internal rate of return of 63.2%, with a payback of 1.7 years.

Capital Expenditure
Initial capital expenditure is estimated at $109-million.

Planned Start/End Date
Construction is expected to start in the second quarter of 2019, with production expected to start in the first quarter of 2020.

Latest Developments
Savannah has reported that Barosso faces an additional environmental licensing step.

Agência Portuguesa do Ambiente (APA) has determined that the environmental-impact assessment move into the Article 16 phase – an intermediate and optional step designed to allow for adjustments to the project in accordance with the feedback of the stakeholders.

The additional step in the licensing will add to the overall development schedule, but it does have a clearly-defined timeline in law.

“Savannah's team . . . will . . . submit any revised plans to APA as soon as practicable , but under the legislation, a DIA [declaration of environmental impact] decision point would be reached no later than March 2023.

"Assuming a positive DIA decision is received at that time, we believe the project's development would still be on track . . . to supply concentrate to Europe's first generation of lithium conversion plants as they come on line in the mid-2020s,” Interim CEO Dale Ferguson has said.

Savannah’s healthy cash position will comfortably see it through the licensing process and into the next phase of the definitive feasibility study.

Key Contracts, Suppliers and Consultants
Hatch (engineering services); PayneGeo (geological model and resource estimations); Minesure (analysis and definition of the scoping level mining inventory and contractor costs); Primero Group (primary engineering group and lead manager for the feasibility study); Knight Piésold (lead geotechnical and hydrological engineering); Quadrant (consultant on transport and logistics requirements); Nagrom and ALS (assay and metallurgical testwork services); VISA Consultores (environmental-impact statement assessment); CV&A Consultores and S317 Consulting (stakeholder management strategy, community engagement plan and sourcing of European Union funding); and Noah’s Rule (financial adviser).

Contact Details for Project Information
Savannah Resources, David Archer, tel +44 20 7117 2489.