For immediate
release
31 July 2024
CINOVEC LITHIUM PROJECT
UPDATE
European Metals Holdings Limited (ASX & AIM:
EMH) ("European
Metals" or the
"Company") is pleased to provide the following
update regarding the Cinovec Lithium Project ("Cinovec" or the
"Project").
The Company advises that the
timeline for the completion of the Definitive Feasibility Study
("DFS") and therefore
construction of the Cinovec lithium processing plant continue to be
worked on.
Given the change to the location of
the lithium processing plant from Dukla to Prunéřov, additional geotechnical work
is currently underway to confirm the optimal construction method
and layout at the new site. Results from this geotechnical work are
expected to be available at the end of September. DRA Global is
then expected to provide a detailed timeline and begin the DFS
finalisation program of work.
The Company will provide a further
update to the market once it has received a revised timeline for
completion of the DFS.
The Project team continues to
progress several DFS-related programs on the Front-End Comminution
and Beneficiation circuit ("FECAB") and Lithium Chemical
Plant circuit ("LCP") to improve the overall flowsheet which are expected to
positively impact Project economics.
Process Flowsheet Improvements - FECAB
The Company previously announced
changes to the FECAB process flowsheet from beneficiation based
entirely on magnetic separation to a process incorporating both
magnetic separation and flotation, (see the
Company's ASX/AIM announcement of 31 October 2022
"Simplified Extraction Process Delivers Exceptionally Clean
Battery-Grade Lithium Product with Improved
Economics"). This improvement
yielded a total FECAB lithium recovery of >87%, with 7-8% lost
to the fines fraction and the balance of 5-6% losses due to process
inefficiency. By mass, the proportion of the ore recovered to
concentrate achieved was 30% of the total feed and the grade of the
concentrate entering the LCP was 1.198% lithium (2.58%
Li2O).
To improve FECAB performance,
targeting a higher-grade concentrate, additional flotation testwork
has been carried out. Representative ore samples were utilised,
milled to P80<150μm and tested without removing the <20μm
slimes fraction before flotation.
Results, benefits and impacts of
this testwork are:
· Potential for complete elimination of the magnetic separation
step from the FECAB flowsheet;
· Flotation process without desliming has been successfully
optimised, which improves the recovery of zinnwaldite from the
<20μm fraction whilst not impacting reagent consumption or other
process beneficiation performance factors;
· A
capability to deliver overall FECAB lithium recovery improvements
from >87% to >94.7%, proven on a repeated basis;
· Uplift
in concentrate grade from 1.198% Li (2.58% Li2O) to
produce almost pure zinnwaldite concentrate with average grade of
1.46% Li (3.14% Li2O);
· The
grades of concentrate produced in the flotation testwork are the
highest to date, based on the recoveries achieved and mass
rejection (of gangue) of 80% on average;
· The
flotation testwork program was carried out at neutral pH and there
was no need for chemical addition to adjust pH;
· The
above results are from repeated locked cycle testwork;
· The
locked cycle testwork achieved optimisation of recirculation in the
flotation circuit, such that the final circuit contained only a
single recirculation stream;
· The
improved lithium grade and purity of concentrate recovered are
expected to significantly impact both the operating costs per tonne
("Opex/t") of battery-grade end-product as well as the capital
expenditure per tonne ("Capex/t") for the
LCP;
· The
results of this recent testwork have translated into impacts on the
DFS which include re-sizing of kilns for roasting the concentrate
and reagent and energy consumption reductions for the same overall
process outputs, with the intensive magnetic separation
plant Capex/t and Opex/t
eliminated;
· Expected economic improvements include a reduction in roasting
reagents (gypsum, limestone and sodium sulphate) required for the
same output;
· The
purity of the flotation concentrate achieved further supports
production of exceptionally clean battery-grade end products for
Cinovec;
· A
flotation-only process simplifies the FECAB operationally (in
addition to reducing Capex/t and Opex/t);
· The
measured Particle Size Distribution ("PSD") of the flotation concentrate is close to the ideal PSD for
kiln feed. As a result, the need for a concentrate regrind
mill currently in the process flowsheet is being
re-assessed.
The flotation testwork has yielded
excellent results and the Project team is now considering the full
ramifications in bulk materials handling, tailings storage and
backfilling, should a positive decision be made to change the FECAB
process flowsheet to 100% flotation beneficiation. The Company will
provide an update when a decision has been made.
Process Flowsheet Improvements - Lithium Chemical
Plant
The principal roasting reagents
mixed with lithium-bearing ore (zinnwaldite) concentrate, as stated
above, are gypsum, limestone and sodium sulphate. The LCP process
produces a waste stream of mixed sulphate, including sodium
sulphate, potassium sulphate, rubidium sulphate, with a residual
component of lithium sulphate derived from lithium which is not
converted into lithium phosphate during its first pass through the
lithium phosphate reactor tank.
The Company has recently managed
locked cycle tests that demonstrate the effects of replacing sodium
sulphate roasting reagent entirely with the mixed sulphate waste
stream, targeting reduced overall reagent consumption.
Nine locked cycles were performed
with fully-representative zinnwaldite concentrate roasted in each
test. This testwork was undertaken at Nagrom Laboratories in Perth,
WA.
These tests have been successful,
with the overall lithium recovery in the LCP circuit remaining in
the previously announced range of 88-93% (see the Company's ASX/AIM announcement of 31
October 2022 "Simplified Extraction Process
Delivers Exceptionally Clean Battery-Grade Lithium Product with
Improved Economics").
The recycling of this mixed sulphate
waste stream is a key component of the patent pending for the
Cinovec LCP process.
The benefits and impacts of this
optimisation testwork of the LCP circuit are:
· Elimination of sodium sulphate as a roasting reagent, reducing
Opex/t for the project;
· Lithium not recovered in its first pass through the lithium
phosphate reactor tank circuit is reprocessed, enabling higher
overall lithium recovery. Modelling, based on the results of cycles
5 and 6 of the 2022 Locked Cycle Test program (see
the Company's ASX/AIM
announcement of 31 October 2022 "Simplified Extraction Process
Delivers Exceptionally Clean Battery-Grade Lithium Product with
Improved Economics") assuming fresh,
pure (>98%) sodium sulphate addition upfront, estimates the
amount of lithium lost to the mixed sulphate waste stream as 1.2%.
This is now available for recovery in the revised LCP circuit
design; and
· Reduction in the overall mixed sulphate waste stream required
to be onwards-treated has been achieved, further reducing Opex/t of
the end-product.
The updated LCP circuit design with
recycling of mixed sulphate into the roast mix results in recycling
of approximately 50% of the total mixed sulphate produced. The
remaining mixed sulphate will be reprocessed as waste.
Just Transition Fund
Representatives of Geomet met with
the Regional Standing Conference ("RSK") in the Czech Republic
which is one of the bodies that approves and recommends Just
Transition Fund ("JTF") support.
Geomet has submitted an initial
application for funding of a part of the project (called a
"sub-project"), which initially included the preliminary mine
portal area works - a box-cut (mine entrance), an exploration adit,
work on a portal access road. These construction works are able to
take place under the existing exploration licenses and not
requiring an Environmental Impact Assessment ("EIA"). The total initial grant requested from the JTF has in
turn been reduced from CZK 1.12 billion to CZK 0.8 billion
(approximately EUR 31 million).
The RSK meeting has recommended the
sub-project for JTF support. The next step will be the final
funding approval by the Ministry of Environment.
Keith Coughlan, Executive Chairman,
commented: "Whilst it is disappointing to not be able to
provide a formal completion timeline for the Definitive Feasibility
Study at this time, it is very pleasing to see the progress made
and the positive outcomes of the recent testwork optimising our
processing plant, in particular in respect to the anticipated
reductions in capex and opex. The recent commencement of the site
geotechnical work is expected to deliver a suitable base for the
recommencement of the DFS. These optimisation works, together with
the new site, are expected to deliver stronger project
economics.
The progress made by Geomet with regards to Just Transition
Fund support and the approval given by the Regional Standing
Conference for funding again indicates the level of support for the
Cinovec Project has at all levels of government in the Czech
Republic."
This announcement has been approved
for release by the Board.
CONTACT
For further information on this
update or the Company generally, please visit our website at
www.europeanmet.com
or see full contact details at the end of this
release.
BACKGROUND INFORMATION ON CINOVEC
PROJECT OVERVIEW
Cinovec Lithium Project
Geomet s.r.o. controls the mineral
exploration licenses awarded by the Czech State over the Cinovec
Lithium Project. Geomet has been granted a preliminary mining
permit by the Ministry of Environment and the Ministry of Industry.
The company is owned 49% by EMH and 51% by CEZ a.s. through its
wholly owned subsidiary, SDAS. Cinovec hosts a globally significant
hard rock lithium deposit with a total Measured Mineral Resource of
53.3Mt at 0.48% Li2O, Indicated Mineral Resource of
360.2Mt at 0.44% Li2O and an Inferred Mineral Resource
of 294.7Mt at 0.39% Li2O containing a combined 7.39
million tonnes Lithium Carbonate Equivalent (refer to the Company's ASX/ AIM release dated
13 October 2021)
(Resource Upgrade at
Cinovec Lithium Project).
An initial Probable Ore Reserve of 34.5Mt at
0.65% Li2O reported 4 July 2017 (Cinovec Maiden Ore Reserve -
Further Information) has been declared to cover
the first 20 years mining at an output of 22,500tpa of lithium
carbonate (refer to the Company's ASX/ AIM release dated
11 July 2018) (Cinovec Production Modelled
to Increase to 22,500tpa of Lithium
Carbonate).
This makes Cinovec the largest hard rock
lithium deposit in Europe and the fifth largest non-brine deposit
in the world.
The deposit has previously had over 400,000
tonnes of ore mined as a trial sub-level open stope underground
mining operation.
On 19 January 2022, EMH provided an update to
the 2019 PFS Update. It confirmed the deposit is amenable to bulk
underground mining (refer to the Company's ASX/ AIM release dated
19 January 2022) (PFS Update delivers
outstanding results). Metallurgical test-work
has produced both battery-grade lithium hydroxide and battery-grade
lithium carbonate at excellent recoveries. In February 2023 DRA
Global Limited ("DRA") was appointed to complete the Definitive
Feasibility Study ("DFS").
Cinovec is centrally located for European
end-users and is well serviced by infrastructure, with a sealed
road adjacent to the deposit, rail lines located 5 km north and 8
km south of the deposit, and an active 22 kV transmission line
running to the historic mine. The deposit lies in an active mining
region.
The economic viability of Cinovec has been
enhanced by the recent push for supply security of critical raw
materials for battery production, including the strong increase in
demand for lithium globally, and within Europe specifically, as
demonstrated by the European Union's Critical Raw Materials Act
(CRMA).
BACKGROUND INFORMATION ON
CEZ
Headquartered in the Czech Republic,
CEZ a.s. is one of the largest companies in the Czech Republic and
a leading energy group operating in Western and Central Europe.
CEZ's core business is the generation, distribution, trade in, and
sales of electricity and heat, trade in and
sales of natural gas, and coal extraction. The foundation of power
generation at CEZ Group are emission-free sources. The CEZ
strategy named Clean Energy for Tomorrow is based on ambitious
decarbonisation, development of renewable sources and nuclear
energy. CEZ announced that it would move forward its climate
neutrality commitment by ten years to 2040.
The largest shareholder of its
parent company, CEZ a.s., is the Czech Republic with a stake
of approximately 70%. The shares of CEZ a.s. are traded on the
Prague and Warsaw stock exchanges and included in the PX and
WIG-CEE exchange indices. CEZ's market capitalization is
approximately EUR 20.3 billion.
As one of the leading Central
European power companies, CEZ intends to develop
several projects in areas of energy storage and battery
manufacturing in the Czech Republic and in
Central Europe.
CEZ is also a market leader for
E-mobility in the region and has installed and operates a network
of EV charging stations throughout Czech Republic. The automotive
industry in the Czech Republic is a significant contributor to GDP,
and the number of EV's in the country is expected to grow
significantly in the coming years.
COMPETENT PERSONS
Information in this release that relates to the FECAB metallurgical testwork
is based on, and fairly reflects, technical data and supporting
documentation compiled or supervised by Mr Walter Mädel, a
full-time employee of Geomet s.r.o an associate of the Company. Mr
Mädel is a member of the Australasian Institute of Mining and
Metallurgy ("AUSIMM") and a mineral
processing professional with over 27 years of experience in
metallurgical process and project development, process design,
project implementation and operations. Of his experience, at least
5 years have been specifically focused on hard rock pegmatite
Lithium processing development. Mr Mädel consents to the inclusion
in the announcement of the matters based on this information in the
form and context in which it appears. Mr Mädel is a
participant in the long-term incentive plan of the
Company.
Information in this release that
relates to exploration results is based on, and fairly reflects,
information and supporting documentation compiled by
Dr Vojtech Sesulka. Dr Sesulka is a Certified Professional
Geologist (certified by the European Federation of Geologists), a
member of the Czech Association of Economic Geologist, and a
Competent Person as defined in the JORC Code 2012 edition of the
Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves. Dr Sesulka has provided his prior
written consent to the inclusion in this report of the matters
based on his information in the form and context in which it
appears. Dr Sesulka is an independent consultant with more than 10
years working for the EMH or Geomet companies. Dr Sesulka does not
own any shares in the Company and is not a participant in any
short- or long-term incentive plans of the
Company.
Information in this release that
relates to metallurgical test work and the process design criteria
and flow sheets in relation to the LCP is based on, and fairly
reflects, information and supporting documentation compiled by Mr
Grant Harman (B.Sc Chem Eng, B.Com). Mr Harman is an independent
consultant and the principal of Lithium Consultants Australasia Pty
Ltd with in excess of 14 years of lithium chemicals experience. Mr
Harman has provided his prior written consent to the inclusion in
this report of the matters based on his information in the form and
context that the information appears. Mr Harman is a participant in
the long-term incentive plan of the Company.
The information in this release that
relates to Mineral Resources and Exploration Targets is
based on, and fairly reflects, information
and supporting documentation prepared by Mr Lynn Widenbar. Mr
Widenbar, who is a Member of the Australasian Institute of Mining
and Metallurgy and a Member of the Australasian Institute of
Geoscientists, is a full-time employee of Widenbar and Associates
and produced the estimate based on data and geological information
supplied by European Metals. Mr Widenbar has sufficient experience
that is relevant to the style of mineralisation and type of deposit
under consideration and to the activity that he is undertaking to
qualify as a Competent Person as defined in the JORC Code 2012
Edition of the Australasian Code for Reporting of Exploration
Results, Minerals Resources and Ore Reserves. Mr Widenbar has
provided his prior written consent to the inclusion in this report
of the matters based on his information in the form and context
that the information appears. Mr Widenbar does not own any shares
in the Company and is not a participant in any short- or long-term
incentive plans of the Company.
The Company confirms that it is not aware of
any new information or data that materially affects the information
included in the original market announcement and, in the case of
estimates of Mineral Resources or Ore Reserves, that all material
assumptions and technical parameters underpinning the estimates in
the relevant market announcement continue to apply and have not
materially changed. The Company confirms that the form and context
in which the Competent Person's findings are presented have not
been materially modified from the original market
announcement.
CAUTION REGARDING FORWARD LOOKING STATEMENTS
Information included in this release
constitutes forward-looking statements. Often, but not always,
forward looking statements can generally be identified by the use
of forward looking words such as "may", "will", "expect", "intend",
"plan", "estimate", "anticipate", "continue", and "guidance", or
other similar words and may include, without limitation,
statements regarding plans, strategies and
objectives of management, anticipated production or construction
commencement dates and expected costs or production
outputs.
Forward looking statements inherently involve known and unknown risks,
uncertainties and other factors that may cause the company's actual
results, performance, and achievements to differ materially from
any future results, performance, or achievements. Relevant factors
may include, but are not limited to, changes in commodity prices,
foreign exchange fluctuations and general economic conditions,
increased costs and demand for production inputs, the speculative
nature of exploration and project development, including the risks
of obtaining necessary licences and permits and diminishing
quantities or grades of reserves, political and social risks,
changes to the regulatory framework within which the company
operates or may in the future operate, environmental conditions
including extreme weather conditions, recruitment and retention of
personnel, industrial relations issues and litigation.
Forward looking statements are based on the company and its management's good
faith assumptions relating to the financial, market, regulatory and
other relevant environments that will exist and affect the
company's business and operations in the future. The company does
not give any assurance that the assumptions on which forward
looking statements are based will prove to be correct, or that the
company's business or operations will not be affected in any
material manner by these or other factors not foreseen or
foreseeable by the company or management or beyond the company's
control.
Although the company attempts and
has attempted to identify factors that would cause actual actions,
events or results to differ materially from those disclosed in
forward looking statements, there may be other factors that could
cause actual results, performance, achievements or events not to be
as anticipated, estimated or intended, and many events are beyond
the reasonable control of the company. Accordingly, readers are cautioned not to place undue reliance
on forward looking statements. Forward looking statements in these
materials speak only at the date of issue. Subject to any
continuing obligations under applicable law or any relevant stock
exchange listing rules, in providing this information the company
does not undertake any obligation to publicly update or revise any
of the forward looking statements or to advise of any change in
events, conditions or circumstances on which any such statement is
based.
LITHIUM CLASSIFICATION AND CONVERSION
FACTORS
Lithium grades are normally
presented in percentages or parts per million (ppm). Grades of
deposits are also expressed as lithium compounds in percentages,
for example as a percent lithium oxide (Li2O) content or
percent lithium carbonate (Li2CO3)
content.
Lithium carbonate equivalent
("LCE") is the industry
standard terminology for, and is equivalent to,
Li2CO3. Use of LCE is to provide data
comparable with industry reports and is the total equivalent amount
of lithium carbonate, assuming the lithium content in the deposit
is converted to lithium carbonate, using the conversion rates in
the table included below to get an equivalent
Li2CO3 value in percent. Use of LCE assumes
100% recovery and no process losses in the extraction of
Li2CO3 from the deposit.
Lithium resources and reserves are
usually presented in tonnes of LCE or Li.
The standard conversion factors are
set out in the table below:
Table: Conversion Factors for Lithium Compounds and
Minerals
|
Convert from
|
|
Convert to Li
|
Convert to Li2O
|
Convert to Li2CO3
|
Convert to LiOH.H2O
|
|
Lithium
|
Li
|
1.000
|
2.153
|
5.325
|
6.048
|
|
Lithium Oxide
|
Li2O
|
0.464
|
1.000
|
2.473
|
2.809
|
|
Lithium Carbonate
|
Li2CO3
|
0.188
|
0.404
|
1.000
|
1.136
|
|
Lithium Hydroxide
|
LiOH.H2O
|
0.165
|
0.356
|
0.880
|
1.000
|
|
Lithium Fluoride
|
LiF
|
0.268
|
0.576
|
1.424
|
1.618
|
WEBSITE
A copy of this
announcement is available from the Company's website at
www.europeanmet.com/announcements/.
ENQUIRIES:
|
European Metals Holdings Limited
Keith Coughlan, Executive
Chairman
Kiran Morzaria, Non-Executive
Director
Henko Vos, Company
Secretary
|
Tel: +61 (0) 419 996 333
Email: keith@europeanmet.com
Tel: +44 (0) 20 7440 0647
Tel: +61 (0) 400 550 042
Email: cosec@europeanmet.com
|
|
WH
Ireland Ltd (Nomad & Broker)
James Joyce / Darshan Patel / Isaac
Hooper
(Corporate Finance)
Harry Ansell (Broking)
|
Tel: +44 (0) 20 7220 1666
|
|
Blytheweigh (Financial PR)
Tim Blythe
Megan Ray
Chapter 1 Advisors (Financial PR - Aus)
David Tasker
|
Tel: +44 (0) 20 7138 3222
Tel: +61 (0) 433 112
936
|
|
|
|
The information contained within
this announcement is deemed by the Company to constitute inside
information under the Market Abuse Regulation (EU) No. 596/2014
("MAR") as it forms part of UK domestic law by virtue of the
European Union (Withdrawal) Act 2018 and is disclosed in accordance
with the Company's obligations under Article 17 of MAR.
JORC Code, 2012 Edition - Table
1
Section 1 Sampling Techniques and
Data
|
Criteria
|
JORC Code explanation
|
Commentary
|
|
Sampling techniques
|
·
Nature and
quality of sampling (eg cut channels, random chips, or specific
specialised industry standard measurement tools appropriate to the
minerals under investigation, such as down hole gamma sondes, or
handheld XRF instruments, etc). These examples should not be taken
as limiting the broad meaning of sampling.
·
Include
reference to measures taken to ensure sample representivity and the
appropriate calibration of any measurement tools or systems
used.
·
Aspects of the
determination of mineralisation that are Material to the Public
Report.
·
In cases where
'industry standard' work has been done this would be relatively
simple (eg 'reverse circulation drilling was used to obtain 1 m
samples from which 3 kg was pulverised to produce a 30 g charge for
fire assay'). In other cases more explanation may be required, such
as where there is coarse gold that has inherent sampling problems.
Unusual commodities or mineralisation types (eg submarine nodules)
may warrant disclosure of detailed information.
|
· Between 2014 and 2021, the Company commenced a core drilling
program and collected samples from core splits in line with JORC
Code guidelines.
· Sample
intervals honour geological or visible mineralisation boundaries
and vary between 50cm and 2m. The majority of samples are 1m in
length.
· The
samples are half or quarter of core; the latter applied for large
diameter core.
· Between 1952 and 1989, the Cinovec deposit was sampled in two
ways: in drill core and underground channel samples.
· Channel samples, from drift ribs and faces, were collected
during detailed exploration between 1952 and 1989 by Geoindustria
n.p. and Rudne Doly n.p., both Czechoslovak State companies. Sample
length was 1m, channel 10x5cm, sample mass about 15kg. Up to 1966,
samples were collected using hammer and chisel; from 1966 a small
drill (Holman Hammer) was used. 14179 samples were collected and
transported to a crushing facility.
· Core
and channel samples were crushed in two steps: to -5mm, then to
-0.5mm. 100g splits were obtained and pulverized to -0.045mm for
analysis.
|
|
Drilling techniques
|
·
Drill type (eg
core, reverse circulation, open-hole hammer, rotary air blast,
auger, Bangka, sonic, etc) and details (eg core diameter, triple or
standard tube, depth of diamond tails, face-sampling bit or other
type, whether core is oriented and if so, by what method,
etc).
|
· In
2014, three core holes were drilled for a total of 940.1m. In 2015,
six core holes were drilled for a total of 2,455.0m. In 2016,
eighteen core holes were drilled for a total of 6,459.6m. In 2017,
six core holes were drilled for a total of 2697.1m. In 2018, 5 core
holes were drilled for a total of 1,640.3 and in 2020, 22 core
holes were drilled for a total of 6,621.7m.
· In
2014 and 2015, the core size was HQ3 (60mm diameter) in upper parts
of holes; in deeper sections the core size was reduced to NQ3 (44mm
diameter). Core recovery was high (average 98%). Between 2016 and
2021 up to four drill rigs were used, and select holes employed PQ
sized core for upper parts of the drillholes.
· Historically only core drilling was employed, either from
surface or from underground.
· Surface drilling: 149 holes, total 55,570 meters; vertical and
inclined, maximum depth 1596m (structural hole). Core diameters
from 220mm near surface to 110 mm at depth. Average core recovery
89.3%.
· Underground drilling: 766 holes for 53,126m; horizontal and
inclined. Core diameter 46mm; drilled by Craelius XC42 or DIAMEC
drills.
|
|
Drill sample recovery
|
·
Method of
recording and assessing core and chip sample recoveries and results
assessed.
·
Measures taken
to maximise sample recovery and ensure representative nature of the
samples.
·
Whether a
relationship exists between sample recovery and grade and whether
sample bias may have occurred due to preferential loss/gain of
fine/coarse material.
|
· Core
recovery for historical surface drill holes was recorded on drill
logs and entered into the database.
· No
correlation between grade and core recovery was
established.
|
|
Logging
|
·
Whether core and
chip samples have been geologically and geotechnically logged to a
level of detail to support appropriate Mineral Resource estimation,
mining studies and metallurgical studies.
·
Whether logging
is qualitative or quantitative in nature. Core (or costean,
channel, etc) photography.
·
The total length
and percentage of the relevant intersections
logged.
|
· In
2014-2021, core descriptions were recorded into paper logging forms
by hand and later entered into an Excel database.
· Core
was logged in detail historically in a facility 6km from the mine
site. The following features were logged and recorded in
paper logs: lithology, alteration (including intensity divided into
weak, medium and strong/pervasive), and occurrence of ore minerals
expressed in %, macroscopic description of congruous intervals and
structures and core recovery.
|
|
Sub-sampling techniques and sample
preparation
|
·
If core, whether
cut or sawn and whether quarter, half or all core
taken.
·
If non-core,
whether riffled, tube sampled, rotary split, etc and whether
sampled wet or dry.
·
For all sample
types, the nature, quality and appropriateness of the sample
preparation technique.
·
Quality control
procedures adopted for all sub-sampling stages to maximise
representivity of samples.
·
Measures taken
to ensure that the sampling is representative of the in situ
material collected, including for instance results for field
duplicate/second-half sampling.
·
Whether sample
sizes are appropriate to the grain size of the material being
sampled.
|
· In
2014-21, core was washed, geologically logged, sample intervals
determined and marked then the core was cut in half. Larger core
was cut in half and one half was cut again to obtain a quarter core
sample. One half or one quarter samples was delivered to ALS
Global for assaying after duplicates, blanks and standards were
inserted in the sample stream. The remaining drill core is stored
on site for reference.
· Sample
preparation was carried out by ALS Global in Romania, using
industry standard techniques appropriate for the style of
mineralisation represented at Cinovec.
· Historically, core was either split or consumed entirely for
analyses.
· Samples are considered to be representative.
· Sample
sizes relative to grain sizes are deemed appropriate for the
analytical techniques used.
|
|
Quality of assay data and laboratory tests
|
·
The nature,
quality and appropriateness of the assaying and laboratory
procedures used and whether the technique is considered partial or
total.
·
For geophysical
tools, spectrometers, handheld XRF instruments, etc, the parameters
used in determining the analysis including instrument make and
model, reading times, calibrations factors applied and their
derivation, etc.
·
Nature of
quality control procedures adopted (eg standards, blanks,
duplicates, external laboratory checks) and whether acceptable
levels of accuracy (ie lack of bias) and precision have been
established.
|
· In
2014-21, core samples were assayed by ALS Global. The most
appropriate analytical methods were determined by results of tests
for various analytical techniques.
· The
following analytical methods were chosen: ME-MS81 (lithium borate
fusion or 4 acid digest, ICP-MS finish) for a suite of elements
including Sn and W and ME-4ACD81 (4 acid digest, ICP-AES finish)
additional elements including lithium.
· About
40% of samples were analysed by ME-MS81d (ME-MS81 plus whole rock
package). Samples with over 1% tin are analysed by XRF. Samples
over 1% lithium were analysed by Li-OG63 (four acid and ICP
finish).
· Standards, blanks and duplicates were inserted into the sample
stream. Initial tin standard results indicated possible
downgrading bias; the laboratory repeated the analysis with
satisfactory results.
· Historically, Sn content was measured by XRF and using wet
chemical methods. W and Li were analysed by spectral
methods.
· Analytical QA was internal and external. The former
subjected 5% of the sample to repeat analysis in the same
facility. 10% of samples were analysed in another laboratory,
also located in Czechoslovakia. The QA/QC procedures were set to
the State norms and are considered adequate. It is unknown whether
external standards or sample duplicates were used.
· Overall accuracy of sampling and assaying was proved later by
test mining and reconciliation of mined and analysed
grades.
|
|
Verification of sampling and assaying
|
·
The verification
of significant intersections by either independent or alternative
company personnel.
·
The use of
twinned holes.
·
Documentation of
primary data, data entry procedures, data verification, data
storage (physical and electronic) protocols.
·
Discuss any
adjustment to assay data.
|
· During
the 2014-21 drill campaigns Geomet indirectly verified grades of
tin and lithium by comparing the length and grade of mineral
intercepts with the current block model.
|
|
Location of data points
|
·
Accuracy and
quality of surveys used to locate drill holes (collar and down-hole
surveys), trenches, mine workings and other locations used in
Mineral Resource estimation.
·
Specification of
the grid system used.
·
Quality and
adequacy of topographic control.
|
· In
2014-21, drill collar locations were surveyed by a registered
surveyor.
· Down
hole surveys were recorded by a contractor.
· Historically, drill hole collars were surveyed with a great
degree of precision by the mine survey crew.
· Hole
locations are recorded in the local S-JTSK Krovak grid.
· Topographic control is excellent.
|
|
Data spacing and distribution
|
·
Data spacing for
reporting of Exploration Results.
·
Whether the data
spacing and distribution is sufficient to establish the degree of
geological and grade continuity appropriate for the Mineral
Resource and Ore Reserve estimation procedure(s) and
classifications applied.
·
Whether sample
compositing has been applied.
|
· Historical data density is very high.
· Spacing is sufficient to establish Measured, Indicated and
Inferred Mineral Resource Estimates.
· Areas
with lower coverage of Li% assays have been identified as
Exploration Targets.
· Sample
compositing to 1m intervals has been applied mathematically prior
to estimation but not physically.
|
|
Orientation of data in relation to geological
structure
|
·
Whether the
orientation of sampling achieves unbiased sampling of possible
structures and the extent to which this is known, considering the
deposit type.
·
If the
relationship between the drilling orientation and the orientation
of key mineralised structures is considered to have introduced a
sampling bias, this should be assessed and reported if
material.
|
· In
2014-21, drill hole azimuth and dip was planned to intercept the
mineralized zones at near-true thickness. As the mineralized
zones dip shallowly to the south, drill holes were vertical or near
vertical and directed to the north. Due to land access
restrictions, certain holes could not be positioned in sites with
ideal drill angle.
· Geomet
has not directly collected any samples underground because the
workings are inaccessible at this time.
· Based
on historic reports, level plan maps, sections and core logs, the
samples were collected in an unbiased fashion, systematically on
two underground levels from drift ribs and faces, as well as from
underground holes drilled perpendicular to the drift
directions. The sample density is adequate for the style of
deposit.
· Multiple samples were taken and analysed by the Company from
the historic tailing repository. Only lithium was analysed (Sn and
W too low). The results matched the historic
grades.
|
|
Sample security
|
·
The measures
taken to ensure sample security.
|
· In the
2014-21 programs, only Geomet's employees and contractors handled
drill core and conducted sampling. The core was collected from the
drill rig each day and transported in a company vehicle to the
secure Geomet premises where it was logged and cut. Geomet
geologists supervised the process and logged/sampled the
core. The samples were transported by Geomet personnel
in a company vehicle to the ALS Global laboratory pick-up station.
The remaining core is stored under lock and key.
· Historically, sample security was ensured by State norms
applied to exploration. The State norms were similar to
currently accepted best practice and JORC guidelines for sample
security.
|
|
Audits or reviews
|
·
The results of
any audits or reviews of sampling techniques and
data.
|
· Review
of sampling techniques was carried out from written records. No
flaws found.
|
Section 2 Reporting of Exploration
Results
(Criteria listed in section 1 also
apply to this section.)
|
Criteria
|
JORC Code explanation
|
Commentary
|
|
Mineral tenement and land tenure status
|
·
Type, reference
name/number, location and ownership including agreements or
material issues with third parties such as joint ventures,
partnerships, overriding royalties, native title interests,
historical sites, wilderness or national park and environmental
settings.
·
The security of
the tenure held at the time of reporting along with any known
impediments to obtaining a licence to operate in the
area.
|
· In
June 2020, the Czech Ministry of the Environment granted Geomet
three Preliminary Mining Permits which cover the whole of the
Cinovec deposit. The permits are valid until 2028.
· Geomet
plans to amalgamate these into a single Final Mining
Permit.
|
|
Exploration done by other parties
|
·
Acknowledgment
and appraisal of exploration by other parties.
|
· There
has been no acknowledgment or appraisal of exploration by other
parties.
|
|
Geology
|
·
Deposit type,
geological setting and style of mineralisation.
|
· Cinovec is a granite-hosted tin-tungsten-lithium
deposit.
· Late
Variscan age, post-orogenic granite intrusion tin and tungsten
occur in oxide minerals (cassiterite and wolframite). Lithium
occurs in zinnwaldite, a Li-rich muscovite.
· Mineralization in a small granite cupola. Vein and
greisen type. Alteration is greisenisation,
silicification.
|
|
Drill hole Information
|
·
A summary of all
information material to the understanding of the exploration
results including a tabulation of the following information for all
Material drill holes:
o easting and northing of the
drill hole collar
o elevation or RL (Reduced
Level - elevation above sea level in metres) of the drill hole
collar
o dip and azimuth of the
hole
o down hole length and
interception depth
o hole
length.
·
If the exclusion
of this information is justified on the basis that the information
is not Material and this exclusion does not detract from the
understanding of the report, the Competent Person should clearly
explain why this is the case.
|
· Reported previously.
|
|
Data aggregation methods
|
·
In reporting
Exploration Results, weighting averaging techniques, maximum and/or
minimum grade truncations (eg cutting of high grades) and cut-off
grades are usually Material and should be stated.
·
Where aggregate
intercepts incorporate short lengths of high grade results and
longer lengths of low grade results, the procedure used for such
aggregation should be stated and some typical examples of such
aggregations should be shown in detail.
·
The assumptions
used for any reporting of metal equivalent values should be clearly
stated.
|
· Reporting of exploration results has not and will not include
aggregate intercepts.
· Metal
equivalent not used in reporting.
· No
grade truncations applied.
|
|
Relationship between mineralisation widths and intercept
lengths
|
·
These
relationships are particularly important in the reporting of
Exploration Results.
·
If the geometry
of the mineralisation with respect to the drill hole angle is
known, its nature should be reported.
·
If it is not
known and only the down hole lengths are reported, there should be
a clear statement to this effect (eg 'down hole length, true width
not known').
|
· Intercept widths are approximate true widths.
· The
mineralization is mostly of disseminated nature and relatively
homogeneous; the orientation of samples is of limited
impact.
· For
higher grade veins care was taken to drill at angles ensuring
closeness of intercept length and true widths.
· The
block model accounts for variations between apparent and true
dip.
|
|
Diagrams
|
·
Appropriate maps
and sections (with scales) and tabulations of intercepts should be
included for any significant discovery being reported These should
include, but not be limited to a plan view of drill hole collar
locations and appropriate sectional views.
|
· Appropriate maps and sections have been generated by Geomet
and independent consultants. Available in customary vector and
raster outputs and partially in consultant's reports.
|
|
Balanced reporting
|
·
Where
comprehensive reporting of all Exploration Results is not
practicable, representative reporting of both low and high grades
and/or widths should be practiced to avoid misleading reporting of
Exploration Results.
|
· Balanced reporting in historic reports guaranteed by norms and
standards, verified in 1997 and 2012 by independent
consultants.
· The
historic reporting was completed by several State institutions and
cross validated.
|
|
Other substantive exploration data
|
·
Other
exploration data, if meaningful and material, should be reported
including (but not limited to): geological observations;
geophysical survey results; geochemical survey results; bulk
samples - size and method of treatment; metallurgical test results;
bulk density, groundwater, geotechnical and rock characteristics;
potential deleterious or contaminating
substances.
|
· Data
available: bulk density for all representative rock and ore types;
(historic data + 92 measurements in 2016-21 from current core
holes); petrographic and mineralogical studies, hydrological
information, hardness, moisture content, fragmentation
etc.
|
|
Further work
|
·
The nature and
scale of planned further work (eg tests for lateral extensions or
depth extensions or large-scale step-out
drilling).
·
Diagrams clearly
highlighting the areas of possible extensions, including the main
geological interpretations and future drilling areas, provided this
information is not commercially sensitive.
|
· Grade
verification sampling from underground or drilling from
surface. Historically-reported grades require modern
validation in order to improve resource classification.
· The
number and location of sampling sites will be determined from a 3D
wireframe model and geostatistical considerations reflecting grade
continuity.
· The
geologic model will be used to determine if any infill drilling is
required.
· The
deposit is open down-dip on the southern extension, and locally
poorly constrained at its western and eastern extensions, where
limited additional drilling might be required.
· No
large-scale drilling campaigns are required.
|
Section 3 Estimation and Reporting
of Mineral Resources
(Criteria listed in section 1, and
where relevant in section 2, also apply to this
section.)
|
Criteria
|
JORC Code explanation
|
Commentary
|
|
Database integrity
|
·
Measures taken
to ensure that data has not been corrupted by, for example,
transcription or keying errors, between its initial collection and
its use for Mineral Resource estimation purposes.
·
Data validation
procedures used.
|
· Assay
and geologic data were compiled by Geomet staff from primary
historic records, such as copies of drill logs and large scale
sample location maps.
· Sample
data were entered in to Excel spreadsheets by Geomet
staff.
· The
database entry process was supervised by a Professional Geologist
who works for Geomet.
· The
database was checked by independent competent persons (Lynn
Widenbar of Widenbar & Associates).
|
|
Site visits
|
·
Comment on any
site visits undertaken by the Competent Person and the outcome of
those visits.
·
If no site
visits have been undertaken indicate why this is the
case.
|
· The
site was visited by Dr Pavel Reichl who identified the previous
shaft sites, tails dams and observed the mineralisation underground
through an adjacent mine working and was previously the Competent
Person for exploration results.
· The
current Competent Person for exploration results, Dr Vojtech
Sesulka, has visited the site on multiple occasions and has been
involved in 2014 to 2021 drilling campaigns.
· The
site was visited in June 2016 by Mr Lynn Widenbar, the Competent
Person for Mineral Resource Estimation. Diamond drill rigs were
viewed, as was core; a visit was carried out to the adjacent
underground mine in Germany which is a continuation of the Cinovec
Deposit.
|
|
Geological interpretation
|
·
Confidence in
(or conversely, the uncertainty of) the geological interpretation
of the mineral deposit.
·
Nature of the
data used and of any assumptions made.
·
The effect, if
any, of alternative interpretations on Mineral Resource
estimation.
·
The use of
geology in guiding and controlling Mineral Resource
estimation.
·
The factors
affecting continuity both of grade and geology.
|
· The
overall geology of the deposit is relatively simple and well
understood due to excellent data control from surface and
underground.
· Nature
of data: underground mapping, structural measurements, detailed
core logging, 3D data synthesis on plans and maps.
· Geological continuity is good. The grade is highest and
shows most variability in quartz veins.
· Grade
correlates with degree of silicification and greisenisation of the
host granite.
· The
primary control is the granite-country rock contact. All
mineralization is in the uppermost 200m of the granite and is
truncated by the contact.
|
|
Dimensions
|
·
The extent and
variability of the Mineral Resource expressed as length (along
strike or otherwise), plan width, and depth below surface to the
upper and lower limits of the Mineral Resource.
|
· The
Cinovec Deposit strikes north-south, is elongated, and dips gently
south parallel to the upper granite contact. The surface
projection of mineralization is about 1km long and 900m
wide.
· Mineralization extends from about 200m to 500m below
surface.
|
|
Estimation and modelling techniques
|
·
The nature and
appropriateness of the estimation technique(s) applied and key
assumptions, including treatment of extreme grade values,
domaining, interpolation parameters and maximum distance of
extrapolation from data points. If a computer assisted estimation
method was chosen include a description of computer software and
parameters used.
·
The availability
of check estimates, previous estimates and/or mine production
records and whether the Mineral Resource estimate takes appropriate
account of such data.
·
The assumptions
made regarding recovery of by-products.
·
Estimation of
deleterious elements or other non-grade variables of economic
significance (eg sulphur for acid mine drainage
characterisation).
·
In the case of
block model interpolation, the block size in relation to the
average sample spacing and the search employed.
·
Any assumptions
behind modelling of selective mining units.
·
Any assumptions
about correlation between variables.
·
Description of
how the geological interpretation was used to control the resource
estimates.
·
Discussion of
basis for using or not using grade cutting or
capping.
·
The process of
validation, the checking process used, the comparison of model data
to drill hole data, and use of reconciliation data if
available.
|
· Block
estimation was carried out in Micromine 2021.5 using Ordinary
Kriging interpolation.
· A geological domain model was
constructed using Leapfrog software with solid wireframes
representing greisen, granite, greisenised granite and the
overlying barren rhyolite. This was used to both control
interpolation and to assign density to the model (2.57 for granite,
2.70 for greisen and 2.60 for all other material).
· Analysis of sample lengths indicated that compositing to 1m
was necessary.
· Search
ellipse sizes and orientations for the estimation were based on
drill hole spacing, the known orientations of mineralisation and
variography.
· An
"unfolding" search strategy was used which allowed the search
ellipse orientation to vary with the locally changing dip and
strike.
· After
statistical analysis, a top cut of 5% was applied to Sn% and W%; a
1.2% top cut is applied to Li%.
· Sn%
and Li% were then estimated by Ordinary Kriging within the
mineralisation solids.
· The
primary search ellipse was 150m along strike, 150m down dip and
7.5m across the mineralisation. A minimum of 4 composites and a
maximum of 8 composites were required.
· A
second interpolation with search ellipse of 300m x 300m x 12.5m was
carried out to inform blocks to be used as the basis for an
exploration target.
· Block
size was 10m (E-W) by 10m (N-S) by 5m
· Validation of the final resource has been carried out in a
number of ways including section comparison of data versus model,
swath plots and production reconciliation. All methods produced
satisfactory results.
|
|
Moisture
|
·
Whether the
tonnages are estimated on a dry basis or with natural moisture, and
the method of determination of the moisture
content.
|
· Tonnages are estimated on a dry basis using the average bulk
density for each geological domain.
|
|
Cut-off parameters
|
·
The basis of the
adopted cut-off grade(s) or quality parameters
applied.
|
· A
series of alternative cutoffs was used to report tonnage and grade:
Lithium 0.1%, 0.2%, 0.3% and 0.4%.
· The
final reporting cutoff of 0.1% Li was chosen based on underground
mining studies carried out By Bara Consulting in 2017 while
developing an initial Probable Ore Reserve Estimate.
|
|
Mining factors or assumptions
|
·
Assumptions made
regarding possible mining methods, minimum mining dimensions and
internal (or, if applicable, external) mining dilution. It is
always necessary as part of the process of determining reasonable
prospects for eventual economic extraction to consider potential
mining methods, but the assumptions made regarding mining methods
and parameters when estimating Mineral Resources may not always be
rigorous. Where this is the case, this should be reported with an
explanation of the basis of the mining assumptions
made.
|
· Mining
is assumed to be by underground methods, with fill.
· An
updated Preliminary Feasibility Study prepared in 2019 established
that it was feasible and economic to use large-scale, long-hole
open stope mining.
· The
2022 updated Preliminary Feasibility Study establishes that it is
feasible and economic to mine using long hole open stoping with
paste backfill.
· Using
a total processing cost of $41/t and a recovery of 77% of Li grade
in ROM ore, a gross payable value per ROM ore tonne of $96/t ($55/t
net margin) has been assumed before inclusion in the mine
plan.
|
|
Metallurgical factors or assumptions
|
·
The basis for
assumptions or predictions regarding metallurgical amenability. It
is always necessary as part of the process of determining
reasonable prospects for eventual economic extraction to consider
potential metallurgical methods, but the assumptions regarding
metallurgical treatment processes and parameters made when
reporting Mineral Resources may not always be rigorous. Where this
is the case, this should be reported with an explanation of the
basis of the metallurgical assumptions made.
|
· Successful locked-cycle tests ("LCT") results carried out in
2022 and a pilot programme carried out in 2023 demonstrate the
Cinovec project's ability to produce battery-grade lithium
carbonate.
• European Metals has also demonstrated that
Cinovec battery grade lithium carbonate can be easily converted
into lithium hydroxide monohydrate with a commonly utilised liming
plant process.
• Six LCTs were run in 2022 and the crude lithium
carbonate from LCTs 4, 5 and 6 was successfully converted to
battery grade lithium carbonate.
• Lithium recoveries of up to 93% were achieved in
the LCTs performed.
• The LCTs and the pilot programme tested
zinnwaldite concentrate from the southern part of Cinovec,
representative of the
first five years of mining.
· The
2023 pilot
programme successfully demonstrated the
hydrometallurgical process flowsheet on a semi-industrial
batch-continuous basis.
· Nine
LCTs performed at Nagrom Laboratories in 2024 successfully
demonstrated that the sodium sulphate roast reagent can be replaced
with the mixed sulphate waste stream. These LCT results were
incorporated into the SysCAD software model, which determined 89.5%
overall lithium recovery for the LCP flowsheet.
· Extensive testwork was conducted on Cinovec ore in the past.
Testing culminated with a pilot plant trial in 1970, where three
batches of Cinovec ore were processed, each under slightly
different conditions. The best result, with a tin recovery of
76.36%, was obtained from a batch of 97.13t grading 0.32% Sn. A
more elaborate flowsheet was also investigated and with flotation
produced final Sn and W recoveries of better than 96% and 84%,
respectively.
· Historical laboratory testwork also demonstrated that lithium
can be extracted from the ore (lithium carbonate was produced from
1958-1966 at Cinovec).
|
|
Environmental factors or assumptions
|
·
Assumptions made
regarding possible waste and process residue disposal options. It
is always necessary as part of the process of determining
reasonable prospects for eventual economic extraction to consider
the potential environmental impacts of the mining and processing
operation. While at this stage the determination of potential
environmental impacts, particularly for a greenfields project, may
not always be well advanced, the status of early consideration of
these potential environmental impacts should be reported. Where
these aspects have not been considered this should be reported with
an explanation of the environmental assumptions
made.
|
· Cinovec is in an area of historic mining activity spanning the
past 600 years. Extensive State exploration was conducted until
1990.
· The
property is located in a sparsely populated area, most of the land
belongs to the State. Few problems are anticipated with regards to
the acquisition of surface rights for any potential underground
mining operation.
· The
envisaged mining method will see much of the waste and tailings
used as underground fill.
|
|
Bulk density
|
·
Whether assumed
or determined. If assumed, the basis for the assumptions. If
determined, the method used, whether wet or dry, the frequency of
the measurements, the nature, size and representativeness of the
samples.
·
The bulk density
for bulk material must have been measured by methods that
adequately account for void spaces (vugs, porosity, etc), moisture
and differences between rock and alteration zones within the
deposit.
·
Discuss
assumptions for bulk density estimates used in the evaluation
process of the different materials.
|
· Historical bulk density measurements were made in a
laboratory.
· The
following densities were applied:
· 2.57
for granite
· 2.70
for greisen
· 2.60
for all other material
|
|
Classification
|
·
The basis for
the classification of the Mineral Resources into varying confidence
categories.
·
Whether
appropriate account has been taken of all relevant factors (ie
relative confidence in tonnage/grade estimations, reliability of
input data, confidence in continuity of geology and metal values,
quality, quantity and distribution of the data).
·
Whether the
result appropriately reflects the Competent Person's view of the
deposit.
|
· The
new 2014 to 2021 drilling has confirmed the Lithium mineralisation
model and allowed the Mineral Resource to be classified in the
Measured, Indicated and Inferred categories.
· The
detailed classification is based on a combination of drill hole
spacing and the output from the kriging interpolation.
· Measured material is located in the south of the deposit in
the area of new infill drilling carried out between 2014 and
2021.
· Material outside the classified area has been used as the
basis for an Exploration Target.
· The
Competent Person (Lynn Widenbar) endorses the final results and
classification.
|
|
Audits or reviews
|
·
The results of
any audits or reviews of Mineral Resource
estimates.
|
· Wardell Armstrong International, in their review of Lynn
Widenbar's initial resource estimate stated "the Widenbar model
appears to have been prepared in a diligent manner and given the
data available provides a reasonable estimate of the drillhole
assay data at the Cinovec deposit".
|
|
Discussion of relative accuracy/ confidence
|
·
Where
appropriate a statement of the relative accuracy and confidence
level in the Mineral Resource estimate using an approach or
procedure deemed appropriate by the Competent Person. For example,
the application of statistical or geostatistical procedures to
quantify the relative accuracy of the resource within stated
confidence limits, or, if such an approach is not deemed
appropriate, a qualitative discussion of the factors that could
affect the relative accuracy and confidence of the
estimate.
·
The statement
should specify whether it relates to global or local estimates,
and, if local, state the relevant tonnages, which should be
relevant to technical and economic evaluation. Documentation should
include assumptions made and the procedures used.
·
These statements
of relative accuracy and confidence of the estimate should be
compared with production data, where available.
|
· In
2012, WAI carried out model validation exercises on the initial
Widenbar model, which included visual comparison of drilling sample
grades and the estimated block model grades, and Swath plots to
assess spatial local grade variability.
· A
visual comparison of Block model grades vs drillhole grades was
carried out on a sectional basis for both Sn and Li mineralisation.
Visually, grades in the block model correlated well with drillhole
grade for both Sn and Li.
· Swath
plots were generated from the model by averaging composites and
blocks in all 3 dimensions using 10m panels. Swath plots were
generated for the Sn and Li estimated grades in the block model,
these should exhibit a close relationship to the composite data
upon which the estimation is based. As the original drillhole
composites were not available to WAI. 1m composite samples based on
0.1% cut-offs for both Sn and Li assays were
· Overall Swath plots illustrate a good correlation between the
composites and the block grades. As is visible in the Swath plots,
there has been a large amount of smoothing of the block model
grades when compared to the composite grades, this is typical of
the estimation method.
|
