Liontown publishes a pre-feasibility study on the Kathleen Valley Lithium Project, but how does it compare to its peer group and the scoping study?

Liontown Resources Ltd (ASX:LTR) has published a pre-feasibility study for its 100%-owned Kathleen Valley Igneous Lithium Project, in Western Australia.

The pre-feasibility study returned a post-tax net present value (NPV8) of A$507mln and an internal rate of return (IRR) of 25%, which compares to a post-tax NPV8 of A$421mln and IRR of 38% from the scoping study of January 2019.

Average annual production of spodumene concentrate decreased by 18%, from 360,000t the scoping study to 295,000t in the pre-feasibility study, which means the operation would remain in the mid-range of its concentrate producing peer group for annual production levels.

The mine life has increased by 189%, from 9 years in the scoping study to 26 years in the pre-feasibility study, which gives the operation the third largest mine life of its concentrate producing peer group (Figure 1).

Figure 1: Life of Mine for Igneous Lithium Operations

Source: Mining and Metals Research Corporation.

Over the life of the operation, Kathleen Valley will produce 7.7mt of spodumene concentrate, making it the fifth-largest concentrate producing operation, based on tonnes produced (Figure 2).

Figure 2: Life of Mine Production from Igenous Lithium Operations

spodumene igneous lithium operations life of mine productionSource: Metals and Mining Research Corporation

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