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Kidman increases Earl Grey lithium resources by 54%

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Kidman increases Earl Grey lithium resources by 54%

Kidman Resources Ltd. said March 19 that an updated estimate increased lithium resources at the Earl Grey deposit by 54%. The deposit forms part of the Mount Holland property in Western Australia, which forms part of a 50/50 lithium joint venture with Sociedad Quimica y Minera de Chile SA, or SQM.

Using a cutoff of 0.50% lithium oxide, or Li2O, the Earl Grey deposit hosts measured, indicated and inferred resources totaling 189 million tonnes grading 1.50% Li2O for 2.8 million tonnes of Li2O or 7 million tonnes of lithium carbonate equivalent.

The update incorporates data from drilling completed through Jan. 31, comprising 68,699.9 meters of reverse circulation and diamond drilling.

The company noted that 91% of the resource is classified in the higher-confidence measured and indicated categories.

Kidman also announced an exploration target for Earl Grey in addition to resources, comprising 20 million to 40 million tonnes grading 1.3% to 1.5% Li2O, with the mineralization to be subject to further drill testing.

The company also reported that a feasibility study on a spodumene mine and concentrator plant next to the Earl Grey deposit may be delayed due to additional sterilization drilling and design work required for a new tailings site, while no delay is expected for initial spodumene concentrate production.

The Bounty pegmatite at Mount Holland was originally going to be repurposed for tailings from the Earl Grey lithium processing circuit, but drill results reported in December 2017 indicated the potential definition of a second resource at Bounty.

An October 2017 scoping study on the Earl Grey deposit defined a posttax net present value of US$565 million, discounted at 10%, with a 57% internal rate of return.