Advancing FL's journey to become leading Li supplier Unearthing Potential This year began with the achievement of pivotal exploration milestones on the Spark deposit. On January 10
th, we intersected 154.3 metres of pegmatite, a significant breakthrough that was further validated on February 8th with the discovery of a new LCT pegmatite. We discovered an intersection of 398.25 metres with an average of 1.88% Li
2O, including a zone touting 3.12% Li2O. The Spark spodumene deposit boasts some of the highest grades x thicknesses in North America and it remains open with significant size upside.
This cross-section below of the Spark deposit is a 2D representation of the pegmatite model looking west, across its main zone. The section is oriented north-south and displays the lithologies and Li
2O% values intersected in each diamond drill hole within an 80-metre window of the plane of intersection.
Other noteworthy significant intersections from the Spark drill hole results in 2023 include:
- DDH PL-094-22: 125.9m of pegmatite averaging 1.51% Li2O, with specific zones reaching up to 2.95% Li2O.
- DDH PL-099-22: 243m of pegmatite averaging 1.58% Li2O, extending the NW zone further to the west.
In early September, we confirmed the Bolt Pegmatite's width and depth, with promising results. Bolt drilling has confirmed that the pegmatite extends over 600 m along strike, with horizontal widths of up to 75 m, and remains open at depth. | | |
Attracting Global Experts
Throughout 2023, we were fortunate to attract leading global experts from the mining and metal producing sector to join our team here in Sudbury, Ontario. In February, we welcomed Graeme Goodall as Vice President (“VP”) of Operations, a professional engineer, and accomplished metallurgical expert with over twenty years of experience in multi-national mining and processing companies. Graeme’s expertise and extensive experience enhance our team, bringing significant value to Frontier Lithium as we plan for production. The addition of Mr. Goodall, along with Dr. Cao (VP of Technology), aligns with the company's strategy to strengthen its lithium refining capabilities with robust North American operational and metallurgical expertise.
As spring unfolded, we appointed Gregory Da Re as our VP of Corporate Development, adding his deep knowledge of EV battery supply chains to our bench strength. In line with Frontier’s vision to become North America’s leading supplier of lithium, Greg played a pivotal role in guiding Ontario's efforts to attract and establish an EV supply chain within the province. This included investments to create Canada's first EV battery gigafactory in Windsor (JV between LG Energy Solution and Stellantis), Umicore's first North American cathode active materials production facility near Kingston, and VW/PowerCo's first gigafactory in North America in St. Thomas.
In the summer of 2023, Erick Underwood joined us as our new Chief Financial Officer with the goal of driving our financial excellence, unlocking operational efficiencies, and delivering shareholder value as we continue on our journey. Mr. Underwood is a highly accomplished executive with a strong track record of success in managing major projects and assets. He has held key positions at esteemed companies such as Chesapeake Gold Corp, Cia. Minera Zafranal (Teck Resources Ltd.), AQM Copper Inc, and BHP Billiton.
In September, we welcomed Clara Lauziere to our team as the Director of Sustainability. Clara brings with her a wealth of experience from both the public and private sectors, along with a track record of accomplishments in advancing critical minerals objectives for the Province. Her expertise in provincial mine permitting and her collaborative efforts in building relationships with our First Nations partners have significantly strengthened our team as we make progress in these crucial aspects of our project.
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Advancing the PAK Project
In mid-summer, we reached a significant milestone with the filing of the NI 43-101 Pre-Feasibility Study (“PFS”) for the PAK Project. This study contemplates an integrated project, from the proposed mine in Northwestern Ontario to a lithium hydroxide chemical plant facility in the Great Lakes Region of North America. The PFS underscores the project’s financial viability and confirms that our 100% owned PAK Project could be the continent’s largest and lowest-cost producer of lithium hydroxide, capable of supplying the rapidly growing electric vehicle industry in North America, with a pre-tax NPV of US $2.59 billion discounted at 8%.
A contract for a Definitive Feasibility Study was awarded on November 1, signaling the next stage of project advancement. The fully integrated mine, mill, and refinery flowsheet demonstrated in the PFS will be advanced in two distinct scopes of work during the DFS. The first scope, the mine and mill, will be completed over the next 12 months. It is projected that a mining and milling facility with an estimated output of 200,000 metric tonnes of spodumene concentrate per annum will be brought online in two stages.
In November, we announced $2 million in grant funding from the Government of Ontario to advance our lithium processing research. This funding enables us to construct a facility that will firstly test conversion processes of sodium sulfate by-products to achieve a closed-loop system for lithium salt production.
As George Pirie, Ontario’s Minister of Mines, stated: “We want lithium from Northern Ontario to fuel the electric vehicle manufacturing revolution in the South, and this investment in Frontier Lithium will support building the processing and refining capacity we need to get it done." | | |
A Promising Future
As we approach the end of 2023, Frontier Lithium stands on a robust foundation and eagerly anticipates the prospects of 2024. Throughout the year, we were gratified to witness the commencement of analyst coverage from BMO, CIBC, and Desjardins on Frontier Lithium, generating heightened interest and optimistic speculation about our narrative. The growing involvement of Canadian banks in the lithium junior mining sector further underscores their confidence in our resource and the trajectory we are charting.
Despite the substantial 80% decrease in lithium chemical prices that posed challenges in the 2023 lithium market, we remain optimistic about the promising opportunities in the short term. Even with fluctuations in China’s lithium spot prices, the market’s resilience is evident. Anticipating global electric vehicle penetration rates to surpass 9%, we believe we are well-positioned for future electrification and growth based on our project’s long-term fundamentals as a future supplier. Our value proposition and strategy will endure beyond short-term market fluctuations.
EV sales are climbing year over year and month over month. According to BNEF, "Long-term outlooks for Zero Emission Vehicle adoption keep getting more bullish. On average, new forecasts for the BEV fleet size in 2030 have risen by 26% since last year. These upward revisions are primarily due to increased policy support and growing consumer interest." Regional demand in Ontario and Quebec for lithium battery plant capacity requires about 100,000 tonnes of LCE annually when ramped up, reinforcing Frontier Lithium's future significance in the region. | | |
As we reflect on the remarkable journey of Frontier Lithium throughout 2023, we are excited to embrace the limitless possibilities that lie ahead in 2024. The foundation we've established this year will undoubtedly propel us forward with unwavering determination to realize our vision of becoming North America's premier lithium supplier by steadfastly advancing the responsible development of the PAK Project. We are actively fostering partnerships with like-minded businesses and capital providers who share our long-term vision. The journey ahead is truly remarkable.