Liontown Resources (ASX: LTR) has revealed more strong lithium results from a reverse circulation and diamond drilling program at its Kathleen Valley lithium-tantalum project in Western Australia.
The explorer today announced the completion of resource definition drilling at its 100% owned project, with the latest results reinforcing the continuity of high-grade lithium mineralisation over a strike length of 1.7km and a vertical depth of 600m.
Highlights from the latest results were 30.1m grading 2.8% lithium oxide from a depth of 322m, including 20.2m at 3.8% lithium oxide; and 19.9m at 2.6% lithium oxide from 393.1m, including 12.9m at 3.6% lithium oxide.
Today’s news follow other recent strong results from the drilling program, including “spectacular” intervals exceeding 5% lithium announced in February.
As a result of the ongoing positive drill results, Liontown also recently released an interim mineral resource estimate upgrade of 139 million tonnes at 1.3% lithium and 140 parts per million tantalum, confirming Kathleen Valley as a tier-one hard rock spodumene lithium resource.
Liontown said a new mineral resource estimate will now be prepared, which will be based on data from 445 holes (for 86,737m) drilled since work began on the project in 2017. Its release is anticipated in late April to early May.
Coronavirus changes project timeline
The mining industry has been hit hard by the flow-on effects of COVID-19 and Liontown said it too has reviewed its available capital and reassessed its priorities.
The company claims it is “adequately funded” but given the substantial increase in the mineral resource estimate and the delineation of a high-grade lithium zone at depth, it has decided to postpone the compilation of a definitive feasibility study.
Instead, Liontown said it will produce an upgraded pre-feasibility study “based on an optimised project configuration” in the 2020 fourth quarter.
This upgraded pre-feasibility study will incorporate the pending updated mineral resource estimate, updated lithium and tantalum test work results, revised process flowsheets based on the test work, revised mine designs that may include both open pit and underground plans, a revised site layout and revised capital and operating cost estimates.
Liontown has also reassessed its strategic objectives and funding position to ensure it can maintain development momentum at Kathleen Valley.
Non-executive directors have agreed to defer all fees they receive from the company from 1 April.
Liontown chief executive officer David Richards and chief operating officer Adam Smits also agreed to reduce the cash component of their renumeration by 45% and 40%, respectively, “for the foreseeable future”.
In addition, the company said it will reduce short to medium-term spending by pushing back lower priority corporate and field-based activities until 2021.