Wealth Minerals Ltd. (TSXV: WML | OTCQB: WMLLF) has announced a positive preliminary economic assessment (PEA) for its Kuska lithium project in Chile. The property, formerly called Ollague, is located about 200km north from Atacama in the Salar de Ollagüe of the Antofagasta region.
The PEA estimates the project at a pre-tax, pre-royalty NPV with a 10% discount of US$1.65B, an internal rate of return of 33%, an after-tax NPV of US$1.15B, and a project IRR of 28%.
“We are extremely happy with the positive PEA results and this important milestone to develop the Kuska project at our Ollagüe salar concessions,” commented Wealth CEO, Henk van Alphen.
“Given Wealth’s long experience with direct lithium extraction technology (DLE), we paid particular attention to this aspect of the PEA, incorporating an extensive selection process for the most suitable DLE equipment and technology providers.”
Mining operations will consist of a well field with brine pumping capacity and a reinjection feed system to return depleted brine into the salar. A direct lithium extraction method to be followed by a refining will produce >99.5% lithium carbonate. The initial operation will produce 10,000tpa lithium carbonate equivalent (LCE), and that rate will be doubled with the addition of a second production module within two years.
The resource estimate, published a year ago, has indicated resources of 741,000t LCE in material grading 175mg/L. There is also an inferred resource grading 185mg/L.
“Our Kuska project is being developed consistently with the national lithium strategy defined earlier this year by the Chilean government,” said Operative CEO (Chile) Franciso Lepeley.
“We are incorporating into our development plan the use of environmentally friendly DLE technology, the active involvement and collaboration of the Quechua indigenous community, and prospective industry partnerships that may facilitate downstream processing of lithium into value-added products.”
Baseline capital expenditures have been estimated at US$749M, including US$44M that will be spent on additional exploration and permitting. Operating expenses have been estimated at US$5,849/t of lithium carbonate produced.
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