Sal de Vida DFS confirms project potential - Galaxy
PERTH (miningweekly.com) – A definitive feasibility study (DFS) into lithium miner Galaxy Resources’ Sal de Vida project, in Argentina, has confirmed the potential for a low-cost, long-life mine.
Galaxy reported on Friday that the project would require a capital investment of some $369.2-million, to support yearly production of 25 000 t/y of battery-grade lithium carbonate and 95 000 t/y of potash, over a 40-year mine life.
“The DFS confirms Sal de Vida has excellent promise as a future low-cost brine mine and lithium carbonate and potash processing facility. We have the potential to add reserves and mine life to this project and maintain belief it will become our flagship asset,” said Galaxy MD Iggy Tan.
He added that the results of the DFS vindicated Galaxy’s decision to merge with Lithium One last year, in order to gain access to the Sal de Vida asset.
The DFS has indicated that the Sal de Vida project has a net present value of some $645-million, and has the potential to generate total yearly revenue of around $215-million, with an operating cash flow before interest and tax of $118-million a year, at full production rates.
Galaxy’s joint venture partners, Korea Resources, LG International and GS Caltex, collectively referred to as the Korea Cornsortium, funded some $15-million towards the prefeasibility study of the Sal de Vida project, with a farm-in agreement to earn a 30% interest in the project.
The Korean Consortium has earned a 4% interest in the project to date, and has 90 days from the completion of the DFS to exercise its option to earn the full 30% interest.
If the option is exercised, the Korea Consortium would provide a project completion guarantee for Galaxy’s portion of the project debt financing until completion, and would use commercially best efforts to obtain project finance.
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