Arcadia’s economy refined in new study

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PERTH (miningweekly.com) – The Direct Optimized Feasibility Study (OFS) of the Arcadia lithium project in Zimbabwe has confirmed the technical viability of the project as part of a single-stage development pathway at 2.4 million tons per year.

ASX-listed Prospect Resources told shareholders on Tuesday that OFS Direct had cut capital expenditure on the project to $ 192 million, from $ 212 million envisioned in the OFS in stages completed earlier this year. .

The OFS in stages envisaged the construction of two modules of 1.2 million tonnes per year, the operation of stage 1 requiring a capital investment of 140 million dollars and the operation of stage 2 a additional capital expenditure of $ 72 million.

The OFS direct also increased the average production of spodumene to 147,000 t / a, against 133,000 t / a considered in the OFS in stages, while the production of technical petalite increased from 86,000 t / a to 94 000 t / a and chemical petalite from 22,000 t / year to 24,000 t / year.

The initial mine life of the project has decreased slightly from 20 years to just over 18 years.

Meanwhile, OFS Direct increased the project’s after-tax net present value from $ 408 million to $ 929 million, and its internal rate of return from 34% to 60%, while the average profit before interest, taxes, depreciation and amortization fell from $ 97 million to $ 175 million.

“While the OFS in stages presented a strong development case for Arcadia with a lower initial capital requirement, the single stage construction at 2.4 million tonnes per year always had to be more convincing in terms of capital and cost. economic efficiency. This expectation was broadly validated by the results of the OFS direct ”, said Prospect MD Sam hosack.

“OFS Direct further strengthens Arcadia’s positioning as one of the world’s leading hard rock lithium assets, with exceptional projected returns under a range of lithium price scenarios. It builds on the detailed technical assessments undertaken as part of the 2019 final feasibility study and has set up the OFS to present a strong and very attractive mining development case for Arcadia.

“As one of the only stand-alone, ready-to-go projects in the world without a fully blocked levy, it is no surprise that interest in the Arcadia strategic partnership process currently being undertaken by Prospect is strong.”

Prospect is currently reviewing financing options for Arcadia.


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