FALCHANI LITHIUM PROJECT, PERU
PROJECT OVERVIEW
Our advanced-stage Falchani project is the 6th largest hard-rock lithium deposit in the world. It benefits from a highly sustainable business model in a geopolitically “friendly” jurisdiction.
Base Case
PROJECT HIGHLIGHTS
4.7 Years Payback
IRR 19.7% (after-tax using USD$12k/t Li2Co3 selling price)
Low CapEx
High Cash Flow
US$430M average annually
- Low second quartile operating costs (per Benchmark Mineral Intelligence)
- Scalable, 33-year mine life producing battery-grade lithium carbonate (“Li2CO3”)
- Estimated to be 6th largest hard rock lithium deposit globally*
- Resource estimate** based on only ~30% of target area
*Based on the Company's review of publicly available information as at March 2019
**NI 43-101 report titled the “Falchani Lithium Project NI 43-101 Technical Report – Preliminary Economic Assessment” prepared by John Joseph Riordan, David Thompson, Valentine Cotzee of DRA Pacific and Mr. Stewart Nupen of The Mineral Corporation
- Robust metallurgical testing indicates conventional processing will produce a high purity battery grade (>99.5%) lithium carbonate
ADVANTAGES
Location Advantages
Excellent Infrastructure
- Easy transport
- Low cost power
- Labour
- Water
- Close to Two Oceans highway
Supply Security (Peru)
- Mining supportive jurisdiction
- Responsible mining practices
Exploration Advantages
Quelcaya Target
- Outcrop mapping and sampling ~6 km west of Falchani deposit
- 1.5 km mapped extent; sampling average grade of 2,986 ppm Li
Tres Hermanas
- Three ridges of outcropping Li-rich tuff, interpreted as tilted upright compared to relatively horizontal at Falchani East and West
- Each ridge estimated at ~80m high x ~750m long east-west
- Surface samples up to 4,452 ppm Li, trenching in progress
Regional Targeting
- 6 km by 5 km interpreted collapsed caldera setting as target for future exploration
- ~ 20 km West, multiple surface samples up to 5,100 ppm Li from large Li-rich tuff outcrop
MINERAL RESOURCES
In March 2019, American Lithium released an updated resource estimate that increased the resource by more than 90 percent.
Minor discrepancies due to rounding may occur. Cut-off 1,000 ppm Li Tonnes are Metric Li Conversion Factors as follows: Li:Li2O=2.153; Li:Li2CO3=5.323; Li2O:Li2CO3=2.473 Geological losses of 5% or 10% have been applied, based on geological structure and data density. The average geological loss is 6%.
1 NI 43-101 report titled “Mineral Resource Estimates for the Falchani Lithium Project in the Puno District of Peru” prepared by Mr. Stewart Nupen, of The Mineral Corporation dated April 18, 2019
JUDICIAL RULING VALIDATES OWNERSHIP OF OCACASA 4 AND ALL DISPUTED 32 CONCESSIONS - POSITIVE IMPACT ON ECONOMICS
ALTERNATE CASE
*After-tax, average annual at steady state throughput of 3mtpa, based on a selling price of $12,000/t Li2CO3
US$844M, NPV (8%)
Base Case: US$1.5B
IRR 18.8%, after-tax*
Base Case: 19.7%
US$4,333 per tonne OPEX
Base Case: US$3,958 per tonne
US$587M Initial Capex
Base Case: US$587M
4.6yrs payback undiscounted
Base Case: 4.7yrs
26 years mine life
Base Case: 33 years
US$3,418M life of mine (LOM)
*cash flow after-tax
Base Case: US$8,977M
US$198M average annual LOM
*cash flow after-tax
Base Case: US$430M
23,000tpa Li2CO3,
Y1-Y7
*steady state quality production
Base Case: 23,000tpa
41,000tpa Li2CO3,
Y8-Y26
*steady state quality production
Base Case: 44,000tpa (Y8-Y12)
