Bacanora to publish Sonora project feasibility study before year end

VANCOUVER (miningweekly.com) – TSX-V- and Aim-listed lithium explorer Bacanora expects to publish a feasibility study on its Sonora lithium project before the end of the year, the company announced on Wednesday.

The explorer is currently targeting first production for 2019/20, following an 18-month build programme.

The study is focused on a two-phase openpit mine and lithium carbonate processing facility, with a mine life of more than 20 years.

Phase 1 entails processing 17 500 t/y of battery-grade lithium carbonate (Li₂CO₃) for the first two years. It will then ramp up to the planned second-phase capacity of 35 000 t/y of Li₂CO₃, the company advised.

Operating and capital cost work for the project is nearing completion, while flow sheet testwork, focused on optimising output, is also progressing.

IMC Mining Consultants, in Tucson, is continuing mine plan optimisation and equipment selection for the openpit mining operation. Local infrastructure at Sonora, as well as consumable chemicals and final design for heavy-vehicle access to the site continue to be a focus, according to Bacanora.

Further, one of the previous schedule priorities for getting energy to the operation has been resolved, with the company receiving five independent proposals from local energy and pipeline groups for supplying energy to Sonora. These include both gas and electrical energy supplies.

Ahead of the completion of the feasibility study, strategic partner and 9.35% shareholder Hanwa is continuing to facilitate discussions in Japan on long-term debt to fund the construction of the mine.

Bacanora added that it had also started preliminary discussions with supplementary debt providers for “more traditional” project financing packages.

Lithium prices continue to strengthen and are nearing $15 000/t, about triple the price that Li₂CO₃ hovered at for years, before prices started to surge early in 2015.

“In anticipation of this and assisted by our strategic partner Hanwa, discussions with long-term debt providers are already under way with regards to funding the construction of what we believe will be a world-class lithium operation in Sonora. This is to allow us to commence the estimated 18-month build programme, subject to final board approval, as we look to capitalise on the anticipated need for new battery-grade supplies of lithium carbonate,” said chief executive Peter Secker.

Meanwhile, a feasibility study continues at Bacanora’s joint venture Zinnwald lithium project, in Germany, which is expected to take between 12 to 18 months to complete.

An application to mine a large bulk ore sample has been approved and this should get under way in the next few weeks, while an infill drilling programme is expected to start in the fourth quarter.

Initial laboratory testwork has demonstrated that higher-value lithium products can be produced from Zinnwald’s concentrates.

Bacanora’s partner at Zinnwald, SolarWorld, recently filed for bankruptcy protection in Germany, but Bacanora said it remains confident that the insolvency process will have “no material impact” on its interest.