Latin Resources Ltd (ASX:LRS, OTC:LRSRF) has significantly improved the world-class credentials of the 100%-owned Salinas Lithium Project in Brazil through an updated resource estimate which has increased the overall resource and boosted JORC confidence levels with greatly enhanced project economics expected.
The mineral resource estimate (MRE), which now stands at 77.7 million tonnes at 1.24% Li2O, is 11% higher than previously while an impressive 95%, or 67.27 million tonnes at 1.27% Li2O, of the Colina Deposit resource is now in the higher confidence measured and indicated categories.
This key outcome underpins the definitive feasibility study (DFS) for Salinas, which is due for release next quarter, and is expected to have a significant positive effect on project economics by targeting improved cash flow and longer mine life.
Among largest deposits
Colina Deposit’s resource of 70.9 million tonnes at 1.25% Li2O places it amongst one of the largest-scale, Tier-One, undeveloped lithium deposits globally.
Latin Resources managing director Chris Gale said: "This is another fantastic result from the Latin Resources exploration team, delivering another uplift in MRE tonnage and significantly improving the confidence in the Colina Lithium Deposit.
"This truly cements the project as hosting one of the largest scale undeveloped lithium deposits on a global scale.
Updated MRE for the Colina Lithium Deposit and Global Salinas Project, reported above a 0.50% Li2O cut-off grade.
"What is particularly pleasing to me is the likely impact on the economics of our upcoming DFS to be released in Q3 2024.
“The PEA we delivered in 2023 clearly demonstrated the compelling case for developing the Salinas Lithium Project, with robust economics including an IRR of 132% and Life of Mine revenue of A$12.6 billion (US$8.4 billion).
“Early belief validated”
"We are proud that our early belief in this world-class Tier-One lithium deposit continues to be validated, and with each key milestone we have hit along the way, to demonstrate the significant financial returns to be delivered to our shareholders.
"Latin is on the cusp of developing a fully sustainable lithium mine, becoming a Tier-One, low-cost producer, with significant cost saving benefits and competitive market advantage from its geographical location in Minas Gerais, Brazil.”
About the MRE update
The MRE update has also increased contained Lithium Carbonate Equivalent (LCE) to 2.2 million tonnes from 2.05 million tonnes.
Colina Deposit’s MRE includes a measured resource of 28.64 million tonnes at 1.31% Li2O, the indicated resource at 38.63 million tonnes at 1.23% Li2O and the inferred resource at 3.6 million tonnes at 1.10% Li2O.
This Salinas MRE upgrade was based on 297 holes for 98,958 metres, an increase of 99 holes and 36,308 metres since the December 2023 MRE.
As well as Colina, the Salinas resource also includes the Fog’s Block deposit where a further exploration target of 7.0 to 18.0 million tonnes at a grade ranging from 0.8% to 1.1% Li2O provides near-term potential to increase the global resource to in excess of 80 million tonnes with further drilling.
Providing even more upside potential for Latin at Salinas is the nearby Planalto Prospect where ongoing diamond drilling is providing the opportunity to take resources beyond 100 million tonnes.
Plan view of the Salinas Project, showing location of the updated Colina Deposit, Planalto discovery and Fog’s Block Deposit.
“Beyond our expectations”
“We are extremely pleased with the outcome of the Colina mineral resource update. Our program of infill drilling which started late last year has resulted in a significant increase in both the size and confidence levels of the mineral resource estimate at Colina," vice president of Operations - Americas Tony Greenaway said.
"We now have approximately 95% of our 71 million tonnes resource in the measured and indicated JORC classification, which is beyond our initial expectations, and means that we have a very solid basis underpinning the declaration of mining reserves.”
The latest Colina MRE update again prepared by SGS, an independent resource consulting firm based in Toronto, is the fourth in the MRE’s history:
- 13.3 million tonnes in December 2022, based on 47 holes for 10,528 metres;
- 45.2 million tonnes in June 2023, based on 135 holes for 39,033 metres;
- 63.5 million tonnes at 1.3% Li2O in December 2023, based on 198 drill holes for 64,769 metres; and
- 70.9 million tonnes at 1.25% Li2O in May 2024, based on 297 drill holes for 98,958 metres of diamond drilling.
Growth potential
"While this is an excellent result, work doesn’t stop at the Salinas Project. We are pivoting our focus back to exploration and the further expansion of our already formidable resource base,” Greenaway said.
"We have five drilling rigs focused at the Planalto Prospect, which is located less than two kilometres from the proposed Colina processing infrastructure.
"Our initial drilling has shown that we have good continuity of the pegmatite swarm intersected in the discovery hole last year, up-dip and closer to surface.
"We will continue to delineate this emerging new deposit, with the aim of potentially generating a maiden resource later in the year.”
Meanwhile, the company is continuing to progress offtake discussions with several credible parties selected to provide low-cost funding.
Salinas Lithium Project tenure.