Lithium producer Sayona Mining (ASX:SYA) has published a Definitive Feasibility Study (DFS) for its Moblan Lithium Project in Canada, highlighting a post-tax net present value (NPV) of C$2.2 billion.
The DFS forecasts annual production from Moblan, which forms the centrepiece of Sayona’s Eeyou Istchee James Bay Hub in Quebec, of 300,000 tonnes per annum of spodumene concentrate over a 21-year mine life.
The production is set to come from open-pit mining at a rate of 1.8 million tonnes (Mt) per annum, based on an ore reserves estimate of 34.5Mt @ 1.36% Li2O.
With a forecast process plant feed of 4,800 tonnes per day and an average life-of-mine recovery of 74.7% spodumene concentrate at 6% Li2O, Sayona is predicting net cashflow of C$6 billion over the project’s life from net revenues of C$14.4 billion.
The DFS outlines a post-tax internal rate of return of 34.4% and a payback period of 2.3 years, with the project to operate on all-in sustaining costs of C$748 per tonne.
Essentially, Sayona, which has a $658.8 million market capitalisation, says the DFS highlights a ‘low-risk’ operation in the prolific James Bay region.
Sayona Interim CEO James Brown says the DFS positions Moblan as an ‘incredibly strategic and valuable’ asset for the company, representing one of the ‘single largest hard rock lithium resources’ in North America.
“Forming the centrepiece of our northern lithium hub, Moblan has an extremely bright future supplying Québec-produced lithium derivatives into the expanding North American battery and EV sector.
Moblan has an amenable orebody that will deliver product from an integrated process of both dense medium separation (DMS) and floatation circuits supported by ore sorting technology.
The offset of delivering such high recoveries is an increase in capital intensity relative to simpler DMS plants. The high expected product recovery will benefit project economics and extend the life of mine.”
Brown adds that recent ‘challenging’ market conditions in the lithium space highlight the importance of developing top-tier lithium projects, and Moblan meets the criteria necessary to deliver high-grade lithium concentrate at ‘industry-low’ and competitive operating costs.
Looking ahead, Sayona now plans to continue advancing regulatory approvals, seeking community support, and securing financing and potential project partners to advance Moblan to production.
However, the company says it will review its development timelines in light of current market conditions, although it’s confident the lithium market will recover over the medium term.
Sayona Mining had around $156 million in cash and $193.5 million in unused finance facilities at the end of December 2023, according to its latest quarterly report.
Images: Sayona Mining
