Scoping Study Update: on 9th November 2023, INF released the results of an Updated Scoping Study for the fully integrated production of battery grade lithium hydroxide monohydrate (LHM or LiOH) at the San José project in Spain.
San José Lithium Project: With 1.6 million tonnes of Lithium Carbonate Equivalent (LCE) in mineral resources, the San José Lithium Project is the second largest JORC defined hard-rock mineral resource in the EU and is strategically located to benefit from booming demand from the emerging gigafactories in the region.
Recoveries: the innovative new lithium conversion process Li-Stream RPKTM locked cycle test work has confirmed 90% lithium recoveries from Run-of-Mine to Product compared to an overall recovery of 53% in the Oct 2021 Scoping Study (made of 66.5% for the beneficiation and 79.6% for the hydrometallurgy). One of the key features of the the Li-Stream RPKTM process is to leach the crushed and milled Run-of-Mine ore meaning there is no beneficiation losses compared to most other process flowsheets including Dense Media Separation or Flotation. The Li-Stream RPKTM process is patent protected and has been developed specifically for the San José mineralisation. The novel process is focused on the leaching unit, while the back end is essentially “off the shelf” as per other LiOH conversion plants globally.
Demonstration Plant: The on-going test work leads to process flowsheet development and continuous improvement program. INF is assessing the next stages for the scale up facility and demonstration plant planned to be built and run in Spain.
Production: thanks to improved recoveries, the same underground mine plan and mining rate of 2 million tpa deliver a steady state LHM production in excess of 33,000 tpa (+71%) over 26 years. With such production profile, San José currently represents the largest planned lithium hydroxide annual production in Europe.
Partnerships: INF has signed a binding MOU with Enalter for a photovoltaic, methane and green hydrogen project aligned with the San José project. INF has also signed a non-binding off-take MOU with LG Energy Solution for 10,000 tpa lithium hydroxide for a minimum of 5 years (ASX announcements 22 Jun & 21 Dec 2022). The granting of the exploration permit in March 2023 has generated increased interest from third parties for material offtakes volumes and strategic involvement in the project.
Government Support: in November 2023, the San José project was awarded a €18.8m (A$31m) grant from the Spanish Government. At this time, the grant funding awarded and secured is aligned to the acquisition of capital equipment relating to San José. Considering the European strategy regarding the EV supply chain, additional grants can be reasonably expected. The EU Council and European Parliament are establishing a regulatory framework to ensure a secure and sustainable supply of critical raw materials, the so called Critical Raw Materials Act.
Permitting: in line with the Government financial support, San José can potentially be recognised as a project of regional significance (PREMIA) and an accelerated permitting timeline. INF is moving forward with an application. On 15 Nov 2023, INF announcement it had received positive urban compatibility report received from the Cáceres Local Government, this report will assist the Exploitation Concession Application (ECA). The ECA will be submitted at the regional level. PREMIA projects will be recognised as regional projects of public interest and are subject to accelerated permitting and administrative assessment. INF has also secured land rights and access through an agreement with landowners to enter into an option over a 35-year lease period covering the life of the Project.
Proven Expertise: INF technical team includes engineers and chemists such as Jon Starink and Dr David Maree, who have a successful track record in developing and commissioning chemical plants for the production of Li2CO3 and LiOH.
Lithium market outlook: despite a significant decrease in lithium products prices since early 2023, the sustained demand for lithium products over the next decades will support lithium prices well in excess of Steady state C1 Costs (post ramp up) of US$5,723/t LiOH after by-product credits.
News flow: Beyond the acceleration of on-the-ground evaluation and the progress of feasibility studies, the key catalysts include agreements with existing and new blue-chip partners to support the development of the project in parallel to the demonstrated support from the local government to the European Union.
INF valuation: our sum of the parts valuation is supported by the current market valuation of lithium peers. Our company valuation amounts to A$296m or $0.62 per share using a ratio market value to NPV of only 5%.
