The PEA outlines initial annual production of 1,000 tons, rising to more than 23,000 metric tons per annum (mtpa) of battery-grade lithium hydroxide monohydrate (LHM) over 19 years, and a pre-tax NPV of $1.5bn at an 8% discount rate (NPV8) and IRR of 45%
Volt will develop Rainbow Lake project in three phases. (Credit: Alex Banner from Pixabay)
Canada-based lithium company Volt Lithium has announced results from its Preliminary Economic Assessment (PEA) for its Rainbow Lake Lithium Project in Alberta, Canada.
Sproule Associates compiled the PEA, integrating the work of Sproule and other consultants with adequate qualifications.
The PEA outlines initial annual production of 1,000 tons, rising to more than 23,000 metric tons per annum (mtpa) of battery-grade lithium hydroxide monohydrate (LHM) over 19 years.
It estimates a pre-tax NPV of $1.5bn at an 8% discount rate (NPV8) and IRR of 45% for the project, and an after-tax NPV of $1.1bn NPV8 and IRR of 35%.
The PEA also predicts operating expenses (OPEX) of around $3,276/ton LHM in the Muskeg formation and around $4,545/ton in the Keg River formation.
It shows project economics assumed at $25,000/ton LHM and provides strong leverage to higher lithium prices.
Volt president and CEO Alex Wylie said: “We are very pleased with the results of the PEA. Volt’s focus on extracting lithium from oilfield brines allows for significant project returns and economics that will allow Volt to grow its lithium production in a measured and responsible way.”
Volt is a lithium brine exploration and development company focused on advancing its Rainbow Lake Project, which is based on an LHM plant with a potential production life of 19 years.
The Canadian mining company plans to expand the Rainbow Lake project in three phases.
The initial phase development will target 1,000 tons per annum (tpa) production, focused on the Muskeg formation with an average lithium grade of 92 mg/L.
In the second phase, the company aims to expand the production to 5,000tpa of LHM, which will also be focused on the Muskeg formation.
The last, third phase of development will expand production to an average of around 23,000tpa of LHM focused on the Muskeg and Keg River formations.
Volt would require $60m expenditure for the initial phase, $242m for the second phase and $946m for the final phase of the lithium project.
The company would require $1.5bn in capital expenditure (capex) for the administration, infrastructure, and contingency of the processing facility.
The PEA suggests treating brines using Volt’s unique direct lithium extraction (DLE) technology, also known as IES-300 technology to selectively extract lithium from brine.
The IES-300 technology was tested during the company’s pilot programme in the second quarter of 2023 and was used as the basis for the PEA.