After 4 years of waiting LTR now has become a miner. This is a great result for all of us.
I have never thought when I bought 4 years ago that LTR was going to be a miner. I was purely in lithium stocks since 2015 but struggling to find a good one until I found LTR. Now I am holding a lithium miner's shares and it will be one of the best 3 mines in the world.
I have done some work on LTR's new strategy for DSO and mining plans. I want to share them with you.
As we know LTR is preparing for DSO mining. I wanted to find out if LTR had that type of ore for making DSO. So I have done some work. You can see the below images and graphs.
And I have found out that LTR have left out a lots of pegmatites on the DFS because the lithium prices were not so high at that time and they have had very high grade (ave. 1.4% L2O) pegmatites at more than enough quantities. The SC6 spod concentrate price was about US$1,300/t on DFS but now it's around US$8,000. Very big difference..! It's now economically viable to mine even ave. 1% grade of ores.
It's well understood by the market now that the market will be in deficit for a long time and lithium prices will remain high at least until end of this decade. As we saw on Lithium Americas (LAC) and GM deal 2 days ago, they will invest US$4b (AU$5.7b) in the Thacker Pass project (Phase-1 US$2.3b 40kt LCE in 2027 and Phase-2 US$1.7b 80kt LCE in 2030) for producing 80kt LCE.
The ore is hectorite (soft clay) which only has 0.6% L2O. That will be a very high cost production. It also tells that the lithium prices will remain high at least until the end of this decade.
Strong lithium market conditions provide a potential opportunity for DSO;DSO sales will be delivering early revenue during the pre- and post-commissioning phase at Kathleen Valley. LTR is currently progressing this DSO opportunity with sample composites currently being prepared for potential customers. They have already started the progress.
DSO process can be done by the contractors as far as I know. LTR does not have to spend money for buying machines and teams to operate it. There are many contractor companies doing that kind of work in WA. They come and set up their own crushers and screeners and start crushing and beneficiation of the ore for DSO.
The Kathleen's Corner pit will be opening soon and the ore will be supplied by the contractor of open pit to the DSO contractor.
I think LTR will be producing 1.4%-1.5% DSO and its price will be around US$1000/t. (CXO's price is US$951/t for 1.4%)
Mine plan optimisation work;
1) Expanded open pit for Cathleen's Corner (for DSO
2) Box-cut instead of open pit for Mt Man and, They have already changed the mining plan. They have done a mine plan optimisation work recently and they reduced the operational complexity of the mine plan from both an open pit and underground mining perspective.
1) The Kathleen’s Corner open pit will be expanded to produce more ore than estimated in DFS. The expanded Kathleen’s Corner open pit will result in more material being moved over the initial project period.
2) And the Mt Mann open pit will be reduced to a large box-cut, which will be completed prior to the establishment of the underground portal and subsequent decline development. You can see the initial mine plan below which was done in DFS. There were 2 starter pits one for Mt Mann (steep pegmatites) and the second one was Kathleen's Corner (nearly horizontal pegmatites).
(The images below were taken from
Inventum3D web site which was done for KV project)
As you can see on the image below the Mt Mann open pit is reduced to a large box-cut, which will be completed prior to the establishment of the underground portal and subsequent decline development.
Also the Kathleen's Corner open pit will be expanded for more pegmatite ore mining including DSO.
You can see an sample image of a box-cut and decline to U/G mine below.
Then I wanted to see how the Cathleen's Corner pegmatite would be expanded, and what were the pegmatites left outside of the open pit before in DFS, which ones can be included.
The image below shows there were many pegmatites left outside of the old open pit of Cathleen's Corner before. Some of them are very close to surface and nearly horizontal, and some of them are deeper, and some are much deeper.
We can see the the sections marked (by me) as 1,2 and 3 are very close to open pit in DFS and they are also close to the surface. The others look much larger but much deeper. I'm not sure of LTR would mine the deep ones.
Tony Ottaviano mentioned that the ore they were planning to use for DSO is about 1mt (between 850kt and 1.2mt). That is not a big thing in comparison to what we have in KV project (156mt)
Therefore I guess it will be easy to get 1mt DSO ore from those sections 1,2 and 3.
(20min delay)