Central African lithium hopeful, AVZ Minerals has taken a significant step towards the ultimate development of its massive Manono lithium and tin project in the Democratic Republic of the Congo, this week awarding a front-end engineering and design study contract to Melbourne-based engineering firm Mincore. AVZ says the study will also contain a project execution schedule for the proposed US$545 million development of Manono.
Perth-based AVZ says key elements of the FEED study include firming up a processing flow sheet, pricing for bulk supplies and selected equipment, and designs for early capital works.
According to the company, Mincore’s decision to accept part payment for the FEED study in AVZ shares represents a strong vote of confidence in the viability of the project.
AVZ Minerals Managing Director, Nigel Ferguson said: “Progressing the design of the Manono project at this time is standard practice and has the benefit of bringing the technical design parameters to finality, thereby providing potential investors and financiers with comfort on the Manono project schedule, capital and opex costs.”
“It will also save significant time moving forward, as the results of the FEED study will be delivered to the successful company that is awarded the process plant EPC (engineering, procurement and construction) contract.”
Latest published proved and probable ore reserve numbers for Manono’s Roche Dure deposit stand at 93 million tonnes grading an impressive average of 1.58 per cent lithium oxide.
AVZ’s definitive feasibility study, or “DFS” on the project development last year showed the current reserves would support an operation producing up to 700,000 tonnes per annum of lithium spodumene going 6.1 per cent for an initial mine life of 20 years.
Financial metrics in the DFS were headlined by a compelling EBITDA figure averaging more than US$400 million a year from a fully developed Manono.
However, in the wake of a recent spate of spectacular broad drill intersections in previously undrilled areas, management says it intends revisiting the geological model for Roche Dure.
AVZ will now look to plug in the fresh drilling data, which may in turn lead to the company refreshing the already impressive DFS parameters including financial, resources, mineable ore and strip ratios.
New stand-out intercepts from AVZ’s latest round of diamond drilling on the Roche Dure pit floor included a 203-metre intersection that went an average grade of 1.59 per cent lithium oxide and 1,014 parts per million tin from surface, 173m at 1.63 per cent lithium oxide and 1,134ppm tin and 95m at 1.52 per cent lithium oxide and 1,057ppm tin, both also from surface.
The company says pegmatitic rock encountered in the previously undrilled areas below the historical open pit were, prior to the latest drilling, classified as waste material – that is, until now. As a result, AVZ aims to release a new mineral resource estimate in the current quarter.
Roche Dure, potentially one of the world’s largest open-pittable lithium-rich pegmatite resources anyway, hosts an indicated, measured and inferred resource – including the reserves – of 400 million tonnes of ore at an average grade of 1.65 per cent lithium oxide, based on last year’s Manono DFS.
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By Matt Birney
