The explorer, which together with ASX-listed Piedmont Lithium, is hoping to start producing within two years, has boosted resources by 16% from 30 million tonnes grading 1.26% lithium to 35.3Mt at 1.25% following drilling last year.

 

Some 28Mt is now classed as measured and indicated, with a maiden 3.5Mt grading 1.37% measured resource. 

 

Reserves are put at 18.9Mt at 1.24%.

 

Atlantic said its infill and extensional drilling had highlighted a "strong geological and mineralisation continuity", with the revised resource to be plugged into the definitive feasibility study that is due by mid-year.

 

It expects the larger resource will improve the numbers for project. 

 

The prefeasibility study Ewoyaa suggested could generate revenues of US$4.5 billion over 12 years assuming an average 255,00tpa of 6% spodumene concentrate.

 

C1 cash costs are estimated at $278/t compared with an expected $1200/t long term price, which is a fraction of current pricing of around $6000/t.

 

The explorer's interim CEO Lennard Kolff said the resource upgrade was a significant de-risking milestone for the first years of throughput.

 

The company, which has around A$19 million cash, recently lodged its mining licence application and is hard at work on its front-end engineering and design studies.

 

Canaccord Genuity analyst Reg Spencer, who has a speculative buy recommendation on the company, said there was now a strong case for plant expansion to 3Mtpa or the extension of initial mine life to 17 years.

 

Given lithium demand, he said there was a strong case to spend an extra US$25 million, for a total $150 million, to upgrade the crushing circuit and boost production to around 380,000tpa, more than making up for lower recoveries noted in the PFS.

 

He said it would deliver "exceptional" upside for what is already among the lowest cost and least capital intensive pre-production assets in the world. 

 

Funding is largely expected to come from Piedmont and Ghana's sovereign wealth fund.

 

Atlantic shares were up 3% this morning at A71c, valuing the company at $445 million. It has traded in a range of 52-99.5c since listing on the ASX last September.