Lepidico takes further steps towards high-grade lithium production in Canada

Lithium developer Lepidico (ASX: LPD) is zeroing in on a probable location for its phase 1 lithium concentrate production plant near Sudbury, Canada following “excellent progress” during the past quarter in optimising its L-Max process – a means of extracting high grade lithium concentrate from hard rock lithium deposits.

L-Max technology currently has several patent applications still pending in Europe, the US and Japan, having already secured an Australian innovation patent last year.

The emerging lithium developer said that the nominal output rate for the phase 1 plant remains 2,500-3,000 tonnes per annum of lithium carbonate; however, the company added that installed capacity for major capital equipment could potentially increase to allow an output of 5,000-6,000tpa.

Lepidico is considering implementing a “cPlant” design as opposed to a traditional flotation plant, with the company saying that such a step could potentially deliver significantly lower EPC project costs, 20% lower capital investment and would require 30% less labour to put into operation.

Furthermore, Lepidico says 95% of installation and pre-commissioning of cPlant is done prior to delivery and requires minimal civil engineering work that could be easily relocated if needed.

With an industrial park near Sudbury selected as the preferred location for its upcoming phase 1 plant, Lepidico is also improving the lithium recovery rate of its L-Max process, which is hoped will lead to both improved lithium recoveries, and substantial operating and capital cost savings for the phase 1 plant project.

Financial metrics

The company spent A$434,000 on the development of its lithium processing technology in Q1 2018 — ironically, almost the same as it spent on administration and corporate costs (A$401,000) in the same period. Lepidico reports that it has around A$6 million in cash still available with zero debt on its balance sheet.

“The vendor testwork program is scheduled to be completed during the June 2018 quarter and will allow trade-offs between capacity and cost to be understood,” according to a statement from Lepidico. The company also said that a feasibility study for its intended plant remains on track and budget for completion during the second half of 2018.

In further news, Lepidico reported that testing of its L-Max residue could prove to be benign and therefore allow Lepidico to become a “zero-waste” lithium carbonate producer and avoid future residue storage costs.

Samples of several L-Max residue streams were produced earlier this year and shipped to Knight Piésold Consulting (KP Consulting) in Ontario to commence residue characterisation work with results pending.

Lepidico is currently collaborating with KP Consulting and the Laurentian University as part of a consultation process with regional officials in the City of Greater Sudbury regarding possible commercial uses for the benign L-Max residue.

If successful, Lepidico says its future phase 1 plant will serve as a zero waste facility, that generates significant capital and operating cost savings.

However, Lepidico warns that depending on the initial assessment of the work being undertaken with Laurentian University, the timing of its feasibility study may be revised to accommodate the use of L-Max residue as a commercial product into its calculations.

If its feasibility study delivery is delayed, the wait could well be worth it considering the envisaged economic benefits.