Name of the Project
Cinovec lithium project.

Location
The project is located in the Krusne Hory mountains, which straddle the border between the Czech Republic and the state of Saxony, in Germany.

Project Owner/s
European Metals Holdings.

Project Description
European Metals Holdings has updated the process flowsheet previously developed for the project to allow for lithium hydroxide production. The project has total indicated and inferred mineral resources of 695.9-million tonnes grading 0.195% lithium, 0.014% tungsten and 0.04% tin. Studies are based on only 9.3% of indicated mineral resource and a mine life of 21 years, processing an average of 1.68-million tonnes a year of ore.

The geometry of the payable ore is largely flat or shallow dipping and massive enough to mechanise using longhole open stope mining. The mine will be accessed through a twin decline system. A conveyor will be installed from the underground primary crusher on 590 m elevation to the surface in the conveyor decline. The second decline will be used as a service decline for workers, material and as an intake airway. The project aims to produce about 25 267 t/y of battery-grade lithium oxide.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has an after-tax net present value, at an 8% discount rate, of $1.11-billion and an internal rate of return of 28.8%.

Capital Expenditure
The project is estimated at $482.6-million.

Planned Start/End Date
The project is expected to take two years to complete.

Latest Developments
European Metals Holdings could begin operations at its Cinovec lithium project by mid-2022, and is holding preliminary discussions with potential customers, it has said.

Czech utility CEZ, in which the state holds a 70% share, has said it has conditionally agreed to provide $2.2-million through a convertible loan to European Metals Holdings, which paves the way for it to become one of the company's largest shareholders.

European Metals controls the exploration licences to the Cinovec lithium/tin project and could help CEZ shift to renewable energy and supply Europe's electric car industry.

The CEZ loan is only a small part of the project’s total capital expenditure, but European Metals MD Keith Coughlan has said it is a commitment that has inspired confidence while CEZ conducts due diligence on the project.

CEZ can convert the principal to shares at any time before the loan's expiry at the end of the year. Czech Prime Minister Andrej Babis has supported the deal if analysis shows mining the project will be promising.

European Metals is working on a definitive feasibility study and says it could begin project construction in mid-2020.

The CEZ loan will make it easier to talk to other financiers, Coughlan has said, adding that he has held preliminary discussions with buyers, including carmakers and battery producers. All are European, although some are units of companies with headquarters beyond Europe.

Key Contracts and Suppliers
Widenbar and Associates (resource estimation); Bara Consulting (mine design and scheduling); Ausenco (front-end communition and beneficiation); and Hath Associates (lithium carbonate and hydroxide plants).

On Budget and on Time?
Not stated.

Contact Details for Project Information
European Metals Holdings, tel + 61 8 6245 2050.