Frontier Lithium Inc. said March 2 that a preliminary feasibility study for the PAK lithium project in Ontario pegged a posttax net present value, discounted at 8%, of C$301 million and a 38.3% internal rate of return.
The study is based on an updated open pit and underground ore reserve of 5.8 million tonnes grading 2.0% lithium oxide, or Li2O, and a measured and indicated mineral resource of 151,143 tonnes Li2O contained in 8.5 million tonnes grading 1.78% Li2O at a 0.4% Li2O equivalent cutoff.
Lithium prices were pegged at US$1,250 per tonne for technical grade and US$750 per tonne for chemical grade.
Initial CapEx is estimated at C$147 million, including a 10% contingency, covering the entire two-year preproduction period. Sustaining capital is C$37 million.
Posttax cash flow for the operation is estimated at C$700 million over the 16-year mine life.
Average throughput is estimated at 1,090 tonnes per day at a processing cost of C$18.01 per tonne produced.
"Despite the strong PFS results, I see room to further optimize the resource and engineering designs and have already transitioned to feasibility level work," said Frontier President and CEO Trevor Walker.
Meanwhile, the company is also progressing potential off-take deals for output from the project.
