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Nemaska Lithium: Updated feasibility study doubles Whabouchi NPV to C$1.16B

Nemaska LithiumInc. said April 4 that an updated feasibility study, encompassing acombined open pit and underground mine plan, on its Whabouchi lithium project in Quebec indicated significantimprovements in the project's economics.

Posttax net present value, using a discount rate of 8%, doubledto C$1.16 billion from C$581 million in the previousstudy in 2014, while the internal rate of return increased to 30.3%from 21%.

The updated study reflects the change of location of the hydrometplant to Shawinigan from Salaberry-de-Valleyfield, both in Quebec, and the optimizationof processes, said President and CEO Guy Bourassa.

These improvements will enable Nemaska Lithium to have a costper tonne for lithium hydroxide at C$2,693 and for lithium carbonate at C$3,441.The new costs of production for lithium hydroxide and lithium carbonate, respectively,are 22% and 18% lower than those of the previous study.

The study also considered current trends in the U.S. to Canadiandollar exchange rate, as well as the forecast prices of lithium compounds.

Total initial CapEx increased to C$549 million from C$500 million,but the payback period was shortened to 2.4 years from 3.7 years.

Revenue over Whabouchi's 26-year mine life jumped to C$9.2 billionfrom C$6.9 billion.

Life of mine production is at 5.5 million tonnes converted into714,000 tonnes of lithium hydroxide and 84,000 tonnes of lithium carbonate, bothbattery grade.

The open pit mine's proven and probable reserves are 20 milliontonnes at 1.53% lithium oxide, the same as the previous feasibility study.