Fresh look as Infinity Lithium advances San Jose

Newly-minted Infinity Lithium Corp (ASX: INF) is on a pathway to take the company and the advanced San Jose lithium-tin project in Spain to the next level.

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Fresh look as Infinity Lithium advances San Jose Fresh look as Infinity Lithium advances San Jose Fresh look as Infinity Lithium advances San Jose Fresh look as Infinity Lithium advances San Jose Fresh look as Infinity Lithium advances San Jose

Plymouth Minerals becomes Infinity Lithium as it advances San Jose

Newly-minted Infinity Lithium Corp (ASX: INF) is on a pathway to take the company and the advanced San Jose lithium-tin project in Spain to the next level.

In this RESOURCEStocks Q&A, managing director Adrian Byass gives an update on the new name and current trajectory.

RESOURCEStocks: It's been less than a month since the company, previously known as Plymouth Minerals, officially changed ticker codes on the ASX to reflect the new name - what prompted the change?

Adrian Byass: Plymouth Minerals was established in 2011 and over a number of years the company was actively involved in the Morille Tungsten-Tin project in Spain and the Equatorial Potash project in Gabon.  In 2015 the company was successful in the tender process for the San Jose Lithium-Tin project in conjunction with our project partners Valoriza Mineria, a subsidiary of the listed engineering and construction company Sacyr.

The recent name change to Infinity Lithium Corporation reflects the company's ongoing focus on our world-class European-based San Jose lithium project located in the Extremadura region in Spain.  The current demand and future outlook for lithium has been largely driven through the rapid growth projections of the electric vehicle market, and the company believes the name change reinforces our primary objectives to participate in this exciting and innovative industry… "to infinity, and beyond."

RS: You recently completed the drilling for San Jose's feasibility study - what will this mean for the project's current resource, of 112 million tonnes at 0.61% lithium oxide and 0.02% tin?

AB: The recently completed small scale diamond drilling program was conducted in 2018 and it has yielded positive results with an imminent upgrade in JORC to be announce in Q2.  It was a strategic program to optimise the openpit design at San Jose and is part of the ongoing feasibility studies.  The results yielded an upgrade in inferred category JORC resources within pit designs to indicated by approximately 1.7 million tonnes.

RS: Completing the feasibility study will take Infinity's ownership of the project to 75% - how is the study progressing and is it on track to be completed this year?

AB: The study has been progressing well with our San Jose Spanish project team having recently completed geotechnical field work.  Infinity believes that the completion of the feasibility study is on track for completion by the end of the year and under the terms of the joint venture agreement earn in to 75% of the San Jose project.

RS: Infinity used downhole camera logging as part of recent geotechnical work, can you outline the improvements this indicated were possible for the mine's proposed strip ratio?

AB: The positive geotechnical results relating to work on the planned pit resulted in an increased gradient on the pit walls and a reduced surface area of the pit on the surface.  This has resulted in a further reduction in the already low strip ratio (less than 2:1) which significantly improves project economics.  The reduced material movement reduces costs in tail stackings and the requirement for other processing inputs such as gas.

Furthermore, the revised footprint provides improved aesthetics for the open pit mine and reduces the environmental impact of the mining operations.  Essentially the geotechnical work that was undertaken in steeping the open pit walls has not only improved the project economics but has also reduced the impact of mining operations through both the lesser dry stacked tails and physical footprint of the mined area.

RS: You've set a goal to improve the project economics, as well as reduce the impact of mining operations at San Jose - what other metrics are you addressing to achieve those twin aims?

AB: Infinity Lithium are actively assessing the broader requirements of battery producers in the lithium-ion market and have recently commissioned a trade-off study to consider the production of lithium hydroxide as part of the San Jose fully integrated project.  As we consider the supply diversity issues currently experienced in the market, we are not only able to promote our product in terms of geographical supply risk but also having an ability to pivot to meet the requirements of our strategic and offtake partners.

The ongoing feasibility studies and outcomes of the recently completed diamond drilling program have yielded improved optimisation of the openpit design with the increased gradient of pit walls and reduced pit circumference.  Infinity are firmly committed to a successful project utilising a process that does not require an acid wash and is planned to recycle approximately 95% of reagents used in the production of battery grade lithium carbonate.

Furthermore, with a stage 1 life of mine modelled over 16 years and production to continue for 24 years, Infinity remain actively engaged to rehabilitate the mine site area whilst providing a clear beneficial economic outcome for the people of the Extremadura region.

RS: What attributes do you believe San Jose's mica lithium deposit has, in terms of its location and compared to its brine and hard rock counterparts?

AB: Clearly there are advantages in terms of its location to the expanding and significant CAPEX developments in battery production facilities in Europe, and more generally participation in the European automotive supply chain process.  Having recently attended The Battery Show Europe in Hannover, the scale of development and battery investment and end user demand is evident.  The accompanying conference was attended by many well known European and Asian market participants with one day interactive session focussing on "Establishing Sustainable Value & Supply Chains For The European Battery Market".

We believe our San Jose fully integrated lithium project provides an attractive alternative source of supply than those currently available, and the investment made by Tianqi for their lithium hydroxide facilities in Kwinana in Western Australia provide adequate reinforcement that the market is addressing alternative opportunities regarding geographical exposure.

RS: Where does your progress at San Jose place it in terms of other European lithium projects in the pipeline?

AB: Due to the historical work conducted we believe we are in the lead pack of lithium developers.

RS: As an Australian-based company, how are you handling the logistics of a European project?

AB: Infinity have a Spanish project general manager who has worked closely with the group over a number of years, and at this stage of our project there has been a seamless transition from our Australian team when they are required on site.  In the future Infinity will be a major employer of people in the Extremadura region through both direct job opportunities and supporting roles, and naturally the dynamic of a higher proportion of roles within our group will reside closer to our asset. 

The San Jose Project is located immediately adjacent to a gas pipeline with readily available, cost effective energy for the roasting process.  Coupled with other supporting infrastructure such as the proximity of a sealed dual lane highway within 2km of the project area, Infinity will not have to build accommodation camps or airstrips, truck in diesel fuel for electricity or other gas reserves, or other activities regularly associated with many resource projects.  Therefore, despite the distance from our head office in Australia, logistically we see many advantages of the existing infrastructure in place.

RS: What are the key themes emerging in your potential offtake discussions?

AB: There are common themes regarding potential offtake agreements however we remain in discussion bound by NDAs at this point in time.  We are able to express that there has been interest shown for both battery grade lithium carbonate and lithium hydroxide products.  Our ability to pivot to our strategic partners' requirements will be expressed in more detail upon completion of the trade-off study.

The demand for battery grade lithium carbonate and lithium hydroxide remains strong with significant consumer projections from IHS Markit for both products evident through to 2027.

RS: Looking ahead, what milestones do you hope to achieve by year-end?

AB: Infinity Lithium remains heavily focused on completing the feasibility study and achieving our earn-in to 75% of the project under our joint venture agreement.  The board continues to strengthen the executive as we enter a period of ongoing negotiations regarding potential strategic partners, offtake provisions and project finance requirements. 

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HEAD OFFICE:

DIRECTORS:

  • Humphrey Hale
  • Kevin Tomlinson
  • Adrian Byass
  • Dr Eric Lilford

SHARES ON ISSUE:

  • 189.89 million

MARKET CAP (at 11 May 2018):

  • A$18.8 million

MAJOR SHAREHOLDERS:

  • Morgan Stanley Australia Securities (Nominee) 5.843%
  • Valiant Equity Management (Byass Family A/C) 2.625%
  • NS Draper and MJ Draper (Draper Super Fund A/C) 1.738%
  • Eric Lilford 1.698%
  • EJ Reeves 1.698%

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category-img

HEAD OFFICE:

DIRECTORS:

  • Humphrey Hale
  • Kevin Tomlinson
  • Adrian Byass
  • Dr Eric Lilford

SHARES ON ISSUE:

  • 189.89 million

MARKET CAP (at 11 May 2018):

  • A$18.8 million

MAJOR SHAREHOLDERS:

  • Morgan Stanley Australia Securities (Nominee) 5.843%
  • Valiant Equity Management (Byass Family A/C) 2.625%
  • NS Draper and MJ Draper (Draper Super Fund A/C) 1.738%
  • Eric Lilford 1.698%
  • EJ Reeves 1.698%