Lithium Royalty Corp. (TSX: LIRC) (“LRC”) is pleased to report that Winsome Resources Limited (“Winsome”) announced the maiden resource for its marquee 100% owned Adina lithium project (the “Adina Project”) in Québec, Canada. Winsome announced a maiden inferred mineral resource of 59 million tonnes at 1.12% lithium oxide (Li2O) content, using a 0.6% cut-off grade. This is a substantial discovery and catapults the resource to the fifth largest lithium deposit in Québec by tonnes. The resource is also a significant milestone for Winsome and for the royalty positions that Lithium Royalty Corp. (“LRC”) owns over the Adina Project, which include a 4.0% gross overriding revenue royalty (GOR) and a 2.0% net smelter return (NSR) on certain claims at the Adina Project.
“Lithium Royalty Corp. was an early supporter of Winsome after its successful spin off from MetalsTech Limited in 2021. LRC congratulates Winsome on this momentous achievement which places the Adina Project as a deposit of global significance. The ore body is coarse grained, close to surface, with plenty of potential for additional resource growth. We believe that the Adina Project will be a critical portion of the North American lithium supply chain once in operation,” said Ernie Ortiz, President and CEO of LRC.
- Significant Global Discovery at Adina Project - Winsome announced a 59Mt inferred mineral resource, which ranks as a major lithium resource on a global basis. In Canada, there are only six other ore bodies with a mineral resource in excess of 50Mt. Similarly, in Australia there are only six spodumene deposits in existence with a resource greater than 50Mt, while in Brazil there are currently only two spodumene resources greater than 50Mt. The resource at the Adina Project is based on 27,625 meters of drilling and assays from 93 drillholes. The resource incorporates a strike length of 1.34km that remains open to the east and west along strike up-dip to the north, and at depth. Drilling has intersected mineralisation to a depth of 300m below surface.
- Upside Potential Through Further Mineral Resource Expansion – Winsome is well funded (cash balance of A$60m as of December 11, 2023) as it pursues over 50,000m of infill and step out drilling in 2024 at Adina. Winsome has five drill rigs on site, with over 25,000m of additional assays expected to be received to update the mineral resource in the first half of 2024. Winsome has defined a total strike length of 3.1km of lithium mineralization at the Adina Project, suggesting upside potential from the current resource zone which incorporates a strike length of 1.34km. Winsome plans to include the additional assays into an updated resource in the first half of 2024, which will underpin a planned pre-feasibility study later in 2024 to continue to advance the project towards production.
- Meaningfully Positive Implications for LRC – Winsome’s mineral resource announcement underscores the benefits of LRC’s strategy of targeting assets that are high grade, low cost, with low levels of technical complexity. This announcement exemplifies LRC’s ability to partner and fund lithium companies across a variety of exploration and developmental stages for the benefit of all stakeholders. LRC owns a 4.0% GOR and a 2.0% NSR on certain claims at the Adina Project. Research analysts who cover Winsome estimate that a mineral resource of that scale could support production throughput of 400,000 tonnes per annum of spodumene concentrate (SC6) at steady state. Under this production scenario and at a $1,500/t SC6 price, LRC estimates that revenues could approximate US$25-30 million per year upon the Adina Project reaching full commercial production.
About Lithium Royalty Corp.
LRC is a lithium-focused royalty company with a globally diversified portfolio of 34 revenue royalties on mineral properties around the world that supply and are expected to supply raw materials to support the electrification of transportation and decarbonization of the global economy. Our portfolio is focused on high-grade and low-cost mineral projects that are primarily located in Australia, Canada, South America and the United States. LRC is a signatory to the Principles for Responsible Investment; the integration of ESG factors and sustainable mining are considerations in our investment analysis and royalty acquisitions.
Forward-Looking Information
This news release contains “forward-looking information” within the meaning of applicable Canadian securities legislation, including statements with regard to the potential expected from the royalty acquired from Winsome Resources Limited (“Winsome”). Forward-looking information involves known and unknown risks and uncertainties, many of which are beyond our control, that could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking information. These risks and uncertainties include, but are not limited to, those described under “Risk Factors” in LRC’s Annual Information Form dated March 31, 2023, and in particular risks summarized under the “Risks Related to Mining Operations” heading. Forward-looking information is based on management’s beliefs and assumptions and on information currently available to management. These assumptions include, but are not limited to, the following: estimates of commodity prices, particularly lithium-related products; the accuracy of public statements and disclosures made by Winsome as the owner, developer and operator of any lithium project based on the mining rights underlying the royalty acquired by LRC, including with respect to mineral resources, mineral reserves, construction timelines, production estimates and other related matters; the economic viability of Winsome’s Adina lithium project; that Winsome’s Adina lithium project will be developed, transitioned into production and successfully achieve production ramp up, in each case, in accordance with expectations; no adverse development relating to Winsome’s Adina lithium project; and the absence of any other factors that could cause actions, events or results to differ from those anticipated, estimated, intended or implied. Although the forward-looking information contained in this news release is based upon what management believes are reasonable assumptions, you are cautioned against placing undue reliance on this information since actual results may vary from the forward-looking information. Unless otherwise noted or the context otherwise indicates, the forward-looking information contained in this news release is provided as of the date of this news release, and we do not undertake to update or amend such forward-looking information whether as a result of new information, future events or otherwise, except as may be required by applicable law.
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