Mina do Barroso, Portugal

Key Info

The Mina do Barroso Lithium Project in northern Portugal is Western Europe’s largest new spodumene lithium discovery. Thanks to the project’s grade, scale and location Savannah has the unique and highly strategic opportunity to become the first significant lithium producer in Europe. With a granted Mining Lease (valid until 2036, extendable for 20 years), a 27Mt Mineral Resource which has the potential to increase further, robust project economics, established infrastructure, and preliminary metallurgical test work indicating that a high-grade (over 6% Li2O), clean, low iron spodumene concentrate can be produced, Mina do Barroso offers significant and very attractive near-term production potential.

Savannah acquired the final 25% stake in June 2019, resulting in an 100% interest in the project, and has maintained a fast paced development approach.

Mineral Resources

Based on results received to date Savannah, believes Mina do Barroso is the closest European analogue to the very successful Australian hard-rock, open cut mine developments, which produce highly sought-after lithium spodumene concentrates for international markets.

The project has a current Mineral Resource of 27.0Mt at 1.06% Li₂O for 285,000t of contained Li₂O. Of this, 17.7Mt at 1.04% Li₂O for a total contained Li₂O of 181,800t has been defined at the Grandao deposit, with ~73% now reported at the higher confidence Measured and Indicated category, which represents the first 4-5 years of the mining inventory. The remaining Mineral Resources have been defined at the NOA, Reservatorio, Pinheiro and Aldeia deposits.  Crucially, significant expansion potential remains and the project has an Additional Resource Target* of 11-19Mt at 1.0-1.2% Li₂O, giving a potential mineral inventory of over 40Mt.

*Cautionary Statement: The potential quantity and grade of the Additional Resource Targets is conceptual in nature, there has been insufficient prospecting work to estimate a mineral resource and it is uncertain if further prospecting will result in defining a mineral resource.

 

Scoping Study 

The Scoping Study published in June 2018 highlights the robust features and outstanding investment appeal of Mina do Barroso with a very high-IRR of 63% and strong cash generation, even with conservative spodumene prices. The project, which is anticipated to produce average annual production of ~175,000tpa of spodumene concentrate at 6% Li₂O, has demonstrated an excellent base case pre-tax NPV8 of US$356m and a life of mine revenue of US$1,555m. This is matched by an attractive initial CAPEX estimate of US$109m, which includes the circuit for feldspar and quartz. The Project’s cash costs put it at the lower end of the spodumene lithium cost curve at US$271 per tonne of concentrate (CIF China).

The feasibility study is now being undertaken to build on the Scoping Study results. 

Development Plan

It is Savannah's intention to be in a position to make a decision for a mine development once the current Feasibility Study has been completed. To be able to advance a project from acquisition to making a development decision within two years will undoubtedly be a significant achievement. Hard rock lithium production has been identified as the key for future lithium supply to meet burgeoning international demand especially for batteries for Electric Vehicles. Savannah believes Mina do Barroso's location and near-term production potential will make its product highly sought after and it can be a strategic up-stream feature for the build-out of the European lithium value chain.

Work has also begun to modify the licencing conditions under the Mining Lease Savannah currently has for the project; the Company has the right to mine approximately 7Mt of lithium, quartz and feldspar ore from seven mining nucleos and will be modifying the conditions for the extraction of additional tonnages and to build a plant specific to lithium processing.

The Company is also looking to secure offtakes with existing spodumene lithium converters.

Expansion Potential

Mina do Barroso is one of a number of prospective areas identified by Savannah in Northern Portugal that covers existing identified pegmatites that could host lithium mineralisation.  The Company is currently awaiting a decision regarding prospecting licence applications for three additional areas that are located close to Mina do Barroso - Calvelo, Meda and Ponte de Lima - and in July 2018 Savannah entered into an exclusive due diligence and option agreement with a view to acquiring a Mining Lease, once granted, over areas of land abutting the southern end and adjacent to Mina do Barroso.

Market Opportunity

Mainland Europe currently consumes around 24% of the world's lithium and is an early adopter of EVs and battery storage solutions. With battery production by major European manufacturers rapidly expanding, any potential local supplies from mainland Europe are being keenly sought; Savannah believes that the Mina do Barroso project, together with its portfolio of lithium prospecting areas, is ideally positioned to address this strategic need.

The Mina do Barroso Lithium Project, June 2018

Related pages

Lithium Overview

Lithium Market Dynamics

E-mobility in Europe

Lithium Battery Industry Initiatives in Europe


Western Europe’s largest spodumene (a lithium bearing mineral) deposit

Opportunity to become the first significant lithium producer in Europe

Approved Mining Plan, Environmental Impact Assessment and Mining Licence

27Mt Mineral Resource including 15Mt in the Measured & Indicated categories

Significant expansion potential including an 11-19Mt Exploration Target across three existing orebodies

Scoping Study demonstrates robust project economics with excellent base case pre-tax NPV8 of US$356m, an IRR of 63% and attractive initial CAPEX estimate of US$109m

Preliminary test work has indicated that a high-grade (over 6% Li₂O), clean, low iron, lithium spodumene concentrate product can be produced

Located in a low-cost and stable political jurisdiction

Ideally positioned to cater to significant European demand from battery / EV markets

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