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MINING |AVZ Minerals
AVZ MINERALS A monstrous lithium project in the DRC
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MINING |AVZ Minerals
Scoping out Roche Dure AVZ Minerals’ 60%-owned Manono Lithium and Tin Project “Our exploration consultant spent two weeks mapping the whole project area. He in the Democratic Republic suggested that Roche Dure was the best of Congo (DRC) was recently place to start because it was ‘low hanging christened the ‘Escondida of fruit’. Roche Dure is just 1.6 km of the total lithium’ by the Chinese Ministry 15.5 km strike length at Manono, so we’ve of Land and Agriculture after only touched approximately 10% of the entire they learned of the potential project area.” size of the resource. “We’ve only drilled a small portion of The Roche Dure scoping study was published the total project area and are to the ASX in May 2019 and contained strong economics, including a massive US$2.63 extremely excited that we have billion pre-royalties, pre-tax NPV, a 64% IRR a 400 million tonnes (Mt) JORC resource at 1.65% lithium,” says and a three-year payback time. The scale and longevity of the project was also confirmed AVZ’s managing director Nigel Ferguson. The Manono resource by the study, which was modelled on a 20year mine life based on a 5 million tonnes also includes additional tin and per annum (Mtpa) open pit mine scenario, tantalum credits, making it consuming only 25% of the resource. one of the largest undeveloped spodumene projects in the world. This model provides for annual production of 1.1 Mt at a minimum of 5.8% lithium. AVZ has only drilled one of six known
However, Ferguson tells RGN it would be
pegmatites across the 188 km2 project area
difficult for the company to justify flooding
– the Roche Dure pegmatite. Roche Dure is
the market with Manono product so AVZ
the ASX-listed company’s initial exploration
plans to recalibrate the annual production
and development focus at Manono,
down to 750,000 tonnes of concentrate,
primarily due to the presence of historical
which puts throughput at 4.5 Mtpa.
geological data from the 1950s and 60s when the area was mined for tin.
“This still allows AVZ flexibility in terms of feeding new clients by increasing production,”
A total of 42 vertical drill holes were made
said Ferguson. “We retain the ability to ‘turn’
to depths of between 50 and 150 metres to
up production to supply new customers if we
produce a lithium concentrate grade of 6.8%
want to.”
at a 10mm crush. Since then, AVZ has drilled 86 drill holes totalling 27,466 metres.
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MINING |AVZ Minerals
A credible offtake partner
several staged expansions to further increase hydroxide production to about 100,000
AVZ is working towards securing its first
tpa, making Yibin Tianyi one of the largest
customer for the lithium produced at
hydroxide suppliers in China.
Manono and is hopeful it will be Chinese lithium chemicals producer Yibin Tianyi
“They have said that by the end of their
Lithium Industry Co after the two struck a
four-phase plant expansion they will need
strategic investment deal in November.
approximately 750,000 tonnes of material. If they turn to us and say, ‘we need all of
The deal will see Yibin Tianyi take a AUS$14.1
it’, then we can certainly supply it,” says a
million share placement in AVZ for 12% of
confident Ferguson.
the company along with a commitment to agreement for lithium products from the
A phased processing approach
Manono Project.
AVZ has its own plans for processing the
‘negotiate in good faith’ a binding offtake
spodumene ore from Manono but it will take Yibin Tianyi is currently building a 25,000
a phased approach, commencing first with
tpa lithium hydroxide plant in China that
Dense Media Separation (DMS) – a simple
should be completed by June. They plan
process which can produce up to 6.3% lithium oxide without the need for flotation.
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Meeting with the President of the DRC The company will then consider a two-phase
The DRC is perhaps the single most
addition of a flotation circuit followed by a
important player in the growing battery
hydroxide circuit, although further test work
metals revolution with around 60% of the
is required to match the flotation cells to the
world’s cobalt – a vital component in mobile
exact characteristics of the Manono ore.
phones, laptops, tablets and electric vehicle batteries – produced in the central African
“We are aware of the problems some players
country.
have had in Western Australia by going straight into DMS, flotation and hydroxide
However, the DRC’s struggles with conflict-
plant production all in one go so we need to
driven mining, human rights abuses and
be careful and understand how we progress.
child exploitation at artisanal cobalt mine sites have been well documented during the
“One idea we have is to maintain the
last few years, leading to consumers directly
750,000 tpa throughput and use the rest
pressuring tech manufacturers to clarify their
of the production to feed into a 25,000 tpa
supply chains all the way to source.
hydroxide plant for other clients that want the material for battery manufacturing in the
Conflict-free mining
automotive space, but also for power banks
So, how will AVZ verify to the global lithium
and storage.”
market that its product has been sourced
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MINING |AVZ Minerals from an industrial mining operation and hasn’t been tainted by conflict mining at any stage of the supply chain? All Manono products will conform to iTSCi standards whereby a ‘source-to-market’ trace will be placed on the material before being sealed in containers and shipped across the world. “Once it’s tagged to international standards and sealed away it’s hard to say it’s come from anywhere else other than Manono,” Ferguson declares. As part of AVZ’s wider commitment to the local communities and social engagement, the AVZ Foundation has also been established. The Foundation has supported a local polio vaccination for more than two years and is also funding the construction of a new school and a hospital in the local area, along with many other smaller infrastructure projects. In addition, AVZ has safely employed more than 800 local people on a casual basis, including 320 displaced artisanal workers, while the Manono project is expected to employ up to 150 local people either directly or indirectly, supporting some 500 families.
A massive two years ahead Ferguson describes this year and 2021 as the ‘crescendo’ of AVZ’s workload at the Manono
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“We’ve only drilled a very small portion of the total project area and we’re very excited by the fact that we have a 400 million tonnes (Mt) JORC resource at 1.65% lithium” Nigel Ferguson, managing director AVZ Minerals
MINING |AVZ Minerals
Nigel Ferguson, managing director AVZ Minerals Project. The definitive feasibility study is approximately 95% complete at the time of writing and should be published by the end of Q1 2020. “Once we have the DFS out, I am hoping all of our financing will follow on the back of that. That’s going to take a bit of effort to organise but if we have Yibin Tianyi onboard it will happen quicker. “We are talking to a couple of major financiers who are interested in participating,
This opportunity to power the mine from
it’s really a case of getting them to sign on the
a hydroelectric plant is likely to generate
dotted line.”
significant longer-term cost savings for AVZ while also providing an environmentally
In mid-January, AVZ signed an MoU with the
cleaner alternative to the current diesel-
DRC government to investigate the feasibility
powered option.
of refurbishing the Mpiana-Mwanga hydroelectric power station located approximately
Finally, AVZ hopes to strike another
85 km from the proposed Manono mine site.
agreement with the DRC government for
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the designation of a Special Economic Zone
developers to become involved and set up
(SEZ) for the Manono Project. The creation
new businesses in the local area.
of a SEZ would generate sustainable growth and prosperity and give increased confidence to potential investors and infrastructure
ASX:AVZ
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Published by Anderson Murray Media Ltd
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