Savannah Resources (AIM: SAV), the company building western Europe’s largest lithium mine, said on Wednesday it shared its shareholders’ frustration regarding the time it has taken Portugal to review its application, but noted it was a political process over which the company had little control.
Chairman Matthew King said the company expected to make further progress at the Mina do Barroso project this year, which would help Europe reduce its dependence on fossil fuels and speed up its “green transition.”
Savannah Resources said it has been two years since it submitted the environmental impact assessment (EIA) for an open-pit mine to Portuguese regulator Agência Portuguesa do Ambiente (APA).
APA then launched a public consultation on the project, which has faced local opposition, but the watchdog is yet to announce its final decision.
“We passed the second anniversary of lodging the EIA,” King said. “This time last year, we had expectations that the decision would have been received by now [but] the finalization of the EIA is a political process over which Savannah has little control.”
The company acquired a 75% interest in Mina do Barroso in May 2017, maintaining a fast paced development approach since. January’s snap parliamentary election in Portugal, King said, had impacted the timing of the assessment as meetings with government officials were postponed.
Mina do Barroso open pit lithium mine would be Europe’s first significant producer of spodumene, a hard-rock form of the battery metal.
The project holds a resource estimate of 27 million tonnes of lithium with over 285,900 tonnes contained Li2O, at an average grade of 1.06% Li2O, which the company believes to be enough to supply a “material proportion” of Europe’s lithium demand over the coming decades.
The mine will also yield a feldspar and quartz co-product used in the ceramics industry, which will be sold to customers locally and in neighbouring Spain.
Recent results from the latest phase of metallurgical test work program at the mine highlights the potential for lower capital and operating costs than those originally estimated.
Portugal, already Europe’s top lithium producer, accounts for about 11% of the global market, but its output is entirely used to make ceramics and glassware. That’s why Europe relies on lithium imports from Latin America’s “Lithium Triangle,” as well from Australia and China.