Argentina’s environment and mining authority in Catamarca province has given Neo Lithium (TSXV: NLC) the necessary clearance it needs for the construction and operation of its Tres Quebradas (3Q) lithium brine mining project, the company said.
The permit satisfies one of the final conditions China’s Zijin Mining needed to acquire the junior exploration company.
Zijin agreed to acquire all of Neo Lithium’s outstanding shares for $6.50 per share in cash in October 2021. In December, Neo Lithium’s shareholders approved the transaction at a special meeting.
“Zijin is in the process of obtaining approval for the transaction from relevant authorities in the People’s Republic of China,” Neo Lithium stated in a press release.
The 35,000-hectare 3Q project has measured and indicated resources of 5.3 million tonnes LCE at an average grade of 636 mg/l lithium.
A feasibility study completed in October forecast a mine life of 50 years with average annual production in the first 20 years of 20,000 tonnes of battery grade LCE.
At an 8% discount rate, the project would generate a post-tax net present value (NPV) of US$1.13 billion and a post-tax internal rate of return (IRR) of 39.5%.
At presstime, Neo Lithium was trading at C$6.40 per share within a 52-week trading range of C$1.92 and C$6.45. The company has 141.3 million common shares outstanding for a market cap of C$904.6 million.
(This article first appeared in the Canadian Mining Journal)