Core Lithium (ASX: CXO) has increased its overall lithium mineral resource estimate at the Finniss project in the Northern Territory by 52% and, significantly, the measured and indicated resource has been lifted 150%.
The company also expects additional reserves and resources can be added to Finniss with further drilling in 2020.
The resource now stands at 14.72 million tonnes at 1.32% lithium oxide, while the measured and indicated categories have increased to 7.62Mt at 1.41% lithium oxide, meaning that more than half the mineral resource estimate is now in the two higher confidence categories. The inferred resource stands at 7.1Mt.
Core describes itself as being well positioned to be Australia’s next lithium producer and said it is developing one of Australia’s most “capital efficient and lowest cost” spodumene lithium projects.
Finniss is located within 25km of Darwin, Australia’s nearest port to Asia, with access to electricity and gas. The workforce will be accommodated in the capital city, an hour’s drive away from the project.
Mining studies targeting an increased mine life of seven to 10 years are expected to be finalised this month and will be used to update the company’s pre-feasibility study.
Offtake talks and financing accelerate
Core managing director Stephen Biggins said the latest results are a further validation of the “enormous potential” of the Finniss project, especially as they improve the mine life projections.
“We continue to be encouraged by the ongoing confidence in lithium demand and project support,” he added.
This has been shown by the recent successful capital raising, with a placement of $5.5 million and a $1.5 million share purchase plan closing early and oversubscribed.
The company said further offtake negotiations and financing plans are accelerating as markets continue to improve, and the increase in mine life and economic outcomes “should be attractive to potential offtake and financing partners”.
In May, Core signed a non-binding memorandum of understanding with Geneva-based Transamine covering the supply of 50,000 tonnes per annum of spodumene concentrate over five years. Transamine is a trading house specialising in strategic materials.
The company also has a binding 75,000tpa supply deal with one of China’s leading lithium companies, Szechuan Yahua.
Resource expansion drilling planned
Mine planning studies are expected to show the high-grade continuous mineralisation is amenable to efficient underground mining methods after the initial development of the Grants deposit as an open pit.
Core said the latest mineral resource estimate has highlighted opportunities to extend and expand the resource with further drilling later this year.
Mine planning has also defined “numerous opportunities” to potentially add additional ore reserves and, as a result, further increase revenue over the extended life of the project.
Approvals have been received by the Northern Territory government.