Now, as you can probably imagine, drilling ain't cheap. Exploration costs were $4.3 million for the quarter that ended September 30th; leaving the company with only about $13 million of cash on its balance sheet. For that reason, Frontier completed another cap raise this October in which it netted $21.5 million, and leaving it with what management believes will be sufficient capital to complete the Prefeasibility Study.
The PFS, which the Company anticipates will be completed sometime in the Spring of 2023, will include important changes from the original plans outlined in the Preliminary Economic Assessment ('PEA') issued last year. Those plans foresaw commercial production beginning in Q1 2027 when both the mine and lithium hydroxide conversion facility would be ready for production.
However, in October, management announced the decision to develop the project in phases. This new approach will see a mine and mill dedicated to the production of technical-grade spodumene built in the initial phase. The second phase will be geared towards expanding both the mine and mill in order to produce chemical-grade concentrate. And the third phase will see construction of the chemical production plant.
While this approach will see hydroxide production begin a year later, it should result in the production of technical-grade spodumene starting six months before the date that was initially forecasted in the PEA. That would be a very positive development as income from the sale of spodumene could cover some of the costs related to the construction of the other two phases. Production will now start in three and a half years instead of the previous four.