Piedmont Lithium (NASDAQ:PLL) Inc (ASX:PLL, NASDAQ:PLL, XETRA:)'s joint venture partner, Sayona Mining Ltd (ASX:SYA) has released a definitive feasibility study (DFS) for the jointly-owned North American Lithium (NAL) project and has increased lithium mineral resources at its 60% owned Moblan Lithium Project, both in the Canadian province of Quebec.
Piedmont holds a 25% stake in NAL and an equity interest of approximately 14% in Sayona, which conducted the technical studies for the two projects.
Upward-revised production
The NAL DFS predicts increased annual spodumene concentrate production averaging 190,000 tonnes per year over a 20-year mine life, with a target of 226,000 tonnes annually in years one through four of steady state operations and around 186,000 tonnes beginning in year five.
The revised production targets, combined with higher spodumene concentrate pricing, represent an increase in the net present value for the NAL project compared to the pre-feasibility study done in 2022.
As part of the DFS and mine restart efforts, Sayona undertook a strategic review of mineral resources and ore reserves to create opportunities to focus on higher-grade, open-pit material and to improve project net present value.
The revised block model has resulted in a reduction in ore reserves and certain indicated resources have been reclassified as inferred resources based on new model interpretation.
The elimination of underground mining results in a shortened mine life in the DFS of 20 years, reduced from the pre-feasibility study estimate of 27 years.
Piedmont holds an offtake agreement with Sayona Quebec to purchase the greater of 113,000 tonnes per year or 50% of the joint venture's spodumene concentrate production.
The company also has agreements with LG Chem and Tesla (NASDAQ:TSLA) to provide spodumene concentrate from NAL beginning in the second half of this year.
Sayona Quebec is undertaking a pre-feasibility study to explore downstream production at NAL and expects results in Q2, 2023.
Increase in resource at Moblan
Sayona has also announced a significant increase in mineral resources at its 60%-owned Moblan project in northern Quebec.
Measured and indicated mineral resources at Moblan now total 41.1 million tonnes at 1.32% LEO using a 0.55% lithium cut-off grade, making Moblan one of North America's most significant spodumene ore bodies.
"The results of the DFS underscore NAL's role as a significant lithium producer positioned to meet the requirements of the Inflation Reduction Act of 2022,” Piedmont's chief operating officer Patrick Brindle said.
“Production is ramping up at NAL and we look forward to making initial shipments to our customers LG Chem and Tesla later in 2023.
“Further, we congratulate our partners at Sayona on the significant mineral resource expansion at their 60%-owned Moblan project.
“We are very pleased with our positions as Sayona's joint venture partner in the Abitibi Hub lithium projects and as Sayona Mining's largest shareholder.
"Quebec is an ideal location for lithium chemicals in the future, given the province's abundant mineral resources, low-cost hydroelectricity, proximity to US markets and supportive provincial government."