Evolution Energy Minerals (ASX: EV1) reports that a recently-completed fixed loop electromagnetics (FLEM) program has highlighted the potential for a material expansion in graphite resources and mine life at its Chilalo Project in southern Tanzania.
The EM surveys identified over 33km of high or ultra-high-conductance graphite targets in addition to the existing Chilalo mineral resource, which itself is situated on a 2km high-conductance response. Given graphite’s high conductivity level, these conductors are expected to represent near-surface, ‘high-grade’ and thick graphite deposits.
The company notes that the discovery of additional near-surface ‘high-grade’ graphite is expected to enhance the economics of the project by reducing mining costs with shallower pits, lowering strip ratio, extending mine life, and providing scope for production expansions in line with the growing demand for graphite in batteries.
Speaking on the survey results, Evolution Energy Minerals Managing Director Phil Hoskins, said: “We are extremely encouraged by these results, demonstrating the scope for significant growth in the Chilalo mineral resource. We already have an 18-year mine life based on Ore Reserves and resource growth is therefore not a pre-requisite for the financing or development of Chilalo.
It is our intention however to demonstrate that Chilalo has globally significant scale with the potential for significant resources and reserve growth and the ability to ramp-up production to meet the rapid growth in demand for lithium-ion batteries, in which graphite makes up over 50% of the contained raw materials. Delineation of near-surface, high-grade graphite is expected to defer waste stripping, reduce mining costs, extend mine life and ultimately enhances Chilalo’s project economics.
“Chilalo has globally significant scale with the potential for significant resources and reserve growth”
Previous work at Chilalo has found that high-conductance EM targets correlate with high grades and mineralisation thickness. We are confident that continuing to target high conductance EM targets will continue to deliver exploration success.”
EV1’s most recent FLEM results identified 8km of very-high-conductance, 25km of high conductance, and 22km of low-conductance. There remains 31km of targets identified by airborne EM that are yet to be followed up by ground-based FLEM. Importantly, the 8km ‘very-high’ region is stronger than Chilalo.
The Chilalo Project hosts a high-grade mineral resource of 20.1Mt at 9.9% total graphitic carbon for 1,991 Kt of contained graphite. Chilalo is described as a ‘robust’ project with an 18-year mine life, and resource growth is not a requirement to obtain finance for construction. EV1 is targeting a final investment decision by Q2 2022.
The Chilalo definitive feasibility study had identified a number of opportunities that could improve the project’s economics, one of which was exploration upside. The discovery of any additional near-surface high-grade deposits has the potential to contribute to a reduction in mining operating costs compared to those in the DFS, by deferring the need to mine the existing deposit to the depth assumed in the DFS.
The company is currently carrying out a trenching program across priority areas to determine surface projections, grade, and thickness of the graphite deposits. Subject to the results of the trenching, which are expected in Q2 2022, a reverse circulation drilling program is projected to commence in May 2022.
Images: Evolution Energy Minerals Limited