Frontier Lithium feasibility study lifts PAK reserves by 37%

Frontier Lithium (TSXV: FL) said a definitive feasibility study for the C$943 million capex PAK project in northern Ontario boosted reserves by 37%.The study, which calculates a net present value of C$932 million based on a discount rate of 8%, provides a “robust basis” for Frontier to target a final investment decision within two years, according to a statement issued Thursday. Frontier is making progress on project financing and has started the permitting process, which should also be completed by mid-2027.Frontier is working with Mitsubishi to develop PAK, which is located more than 1,400 km northwest of Toronto, near the Manitoba-Ontario border. The Japanese conglomerate last year agreed to invest an initial C$25 million for a 7.5% stake in a Frontier subsidiary with an option to increase to 25% after the definitive feasibility study, Frontier CEO Trevor Walker said at the time.The feasibility study “is a key milestone that builds the confidence to advance permitting, infrastructure, and strategic partnerships,” Walker said in Thursday’s release. “With strong projected economics, low costs and long-term earnings, the project could drive self-funded future growth and support Canada’s critical minerals strategy.”The 280-sq.-km project has proven and probable reserves of 31.1 million tonnes at 1.51% lithium oxide, a 37% increase over the company’s 2023 pre-feasibility study, Frontier said Thursday. The maiden inferred resource at the Bolt deposit is 5.5 million tonnes at 1.23%.Three depositsFrontier has identified three high-quality spodumene-bearing deposits — PAK, Spark, and Bolt — within 3 km of each other. Ongoing exploration has also led to the discovery of two additional spodumene-bearing pegmatites, Ember and Pennock, which both lie within the broader project area. PAK is located within the traditional territory of four First Nations.All deposits remain open at depth and with the recent Ember pegmatite discovery, located 1 km north of the Spark deposit. This further highlights the ongoing exploration upside and broader regional potential, Frontier said.PAK’s average annual pre-tax earnings are expected to be C$285 million in steady-state operations, leading to an after-tax internal rate of return of 17.9%, Frontier said. After-tax cash flow for the life of the project is now estimated at C$5.14 billion.All-in sustaining costs should amount to C$624 per tonne of spodumene concentrate, Frontier said. Annual concentrate output from the mine and mill is projected to average 200,000 tonnes over a 31-year mine life, resulting in total production of 6.1 million tonnes. Sustaining capital is forecast at C$137 million and closure capital at C$60 million.Tax revenuePAK is projected to generate more than C$1 billion in federal tax revenue over the life of the project, as well as C$699 million in provincial revenue, Frontier said. More than 230 jobs will be created at the site and sustained for the life of the project, according to the company.In March, Canada’s then natural resources minister Jonathan Wilkinson unveiled C$120 million in federal support – to be matched by a similar amount from Ontario – for PAK. The funds are slated for a new road and bridge to access the project in the province’s northwest. The announcement came after the federal government C$500 million in infrastructure spending for new applications.Frontier shares rose 1.9% to C$0.54 in Toronto Stock Exchange trading Thursday morning, giving the company a market capitalization of about C$123 million. The stock has ranged between C$0.38 and C$0.87 in the past year.Weiter zum vollständigen Artikel bei Mining.com Weiter zum vollständigen Artikel bei Mining.com