Liontown to commence drilling program at Kathleen Valley

Liontown Resources (ASX: LTR) announced that it will undertake a new resource expansion drilling program at its Kathleen Valley Lithium-Tantalum Project in WA.

The company said that the new 15,000m RC/diamond core drilling program is aimed at expanding the current MRE and defining potential underground Resources and Reserves.

It may be noted that Kathleen Valley is Australia’s 5th largest lithium deposit. Thick, high-grade mineralisation has been defined over 1km and remains open along strike and at depth.

LTR said that the Scoping Study released in early 2019 based on the maiden MRE had confirmed the potential to develop a commercially viable, standalone mining operation.

The Company reported that its primary objectives in advancing Kathleen Valley are the completion of a PFS by end of 2019 and immediate transition to a DFS, and planning and execution of the transition from an exploration to a mineral development company.

LTR said that the DFS will incorporate data from the new drilling program, the results of which will be reported over the next few months.

Liontown also announced the drilling update on Buldania project.

Kathleen Valley Lithium-Tantalum project

Liontown’s 100%-owned Kathleen Valley Lithium-Tantalum project is located ~670 km NE of Perth and ~45 km NNW of Leinster in Western Australia. The Project comprises four granted mining leases – MLs 36/264, 265, 459, 460 and one Exploration License – E36/879.

Liontown had announced a 353% increase in the Kathleen Valley Mineral Resource Estimate (MRE) to 74.9Mt at 1.3% Li2O and 140ppm Ta2O5 in July 2019.

The previous drilling at Kathleen Valley had defined a thick (35 – 75m), high-grade pegmatite body which is interpreted to be the feeder zone for the outcropping Mt Mann and Kathleen Corner pegmatite swarms.

This body remains open both along strike and at depth, has been intersected over a strike length of at least 600m, and is part of larger high-grade mineralised system which has now been defined over a strike length of at least 1,000m.

New drilling program at Kathleen Valley

The company announced that it will undertake a new resource expansion drilling program at Kathleen Valley Lithium-Tantalum project as part of its strategy to fast-track the development of a significant new standalone lithium mining operation over the next 12-18 months.

It may be noted that Liontown had recently completed a landmark $18 million capital raising, making it fully-funded to expand Kathleen Valley Mineral Resource and complete feasibility studies within the next 12-18 months.

LTR said that the new drilling program formed part of a clear corporate strategy aimed at advancing the Kathleen Valley Project rapidly towards development as a significant new high-quality Australian lithium-tantalum mining and processing operation.

Liontown reported that the drilling program will comprise up to 31 RC/diamond core holes for a total of 15,000m.

LTR noted that given the grade, thickness, continuity, and orientation of the mineralisation at Kathleen Valley, the new drilling program has been designed to delineate potential open pit and underground resources, in addition to those already defined, which will be included in the DFS.

PFS by 2019 a priority

The Company announced that it has reviewed its corporate strategies and objectives and said that its immediate focus will be on the completion of a Pre-Feasibility Study (PFS) for Kathleen Valley by the end of 2019.

LTR said that the PFS is already well-advanced and will include results from comprehensive metallurgical test work; pit optimisation and scheduling; review of infrastructure requirements; financial analyses of open pit mining; and a Scoping Study on potential additional underground Resources.

Liontown also announced that based on the positive results from the Scoping Study completed earlier this year on the smaller maiden 21.2Mt MRE, it envisages transitioning into a Definitive Feasibility Study (DFS) immediately following the PFS.

New resource extension exploration target

Liontown reported that a resource extension Exploration Target of 25 – 50Mt @ 1.2 – 1.5% Li2O has been defined based on testing for extensions of the current Mineral Resource estimate from the limits of existing drill data to a vertical depth of ~500m below surface with holes 100m apart on 100m spaced lines. This Exploration Target is in addition the current 74.9Mt MRE.

The company said that the drilling will be staged to take into account ongoing results and is estimated to take 2-3 months to complete subject to the timely receipt of all statutory clearances.

Drilling update of Buldania

LTR reported that the resource definition drilling has finished at the Buldania Lithium Project located near Norseman in southern Western Australia with the rig relocating to Kathleen Valley. A total of 168 RC holes for 23,622m and 3 diamond core holes for 548.5m was completed.

The company reported that mineralised pegmatites were intersected over 1.4km strike at the Anna prospect with system remaining open.

LTR said that once all outstanding assays have been received, a maiden MRE is planned to be prepared by an independent resource consultant and scheduled for release on November 2019.

Management comments

Liontown’s Managing Director David Richards said: “We want to maintain the growth momentum that we have built up through the course of this year, which culminated in the recent MRE upgrade and successful $18 million capital raising.

The next round of drilling at Kathleen Valley is aimed at expanding the scale of this already very significant high-grade mineralised system. Drilling will continue for the next 2-3 months and should generate consistent news-flow, laying the foundations for a further resource upgrade.

In the meantime, we will focus on delivering a Pre-Feasibility Study, based on the current MRE, by the end of 2019 as the foundation for a DFS commencing in early 2020.”

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Written By Christopher Norris
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