- The Manono Lithium and Tin Project definitive feasibility study is on track for delivery later this quarter;
- Lithium offtake negotiations are taking place;
- Dewatering at the Roche Dure pit is in its final stages; and
- Transport studies continue with new options emerging
What does AVZ Minerals do?
The company is fast-tracking the partly owned lithium-tin project through to a definitive feasibility study focused on confirmatory testing and optimising recoveries.
AVZ has recently started initial discussions with Yibin Tianyi Lithium Industry Co Ltd on a binding offtake arrangement following a visit to Yibin, China, last week.
In November 2019 the company executed a conditional subscription agreement with Yibin Tianyi for a $14.1 million share placement.
Under the subscription agreement and upon completion of the placement, both parties will negotiate to agree and execute a binding offtake agreement for lithium products from the Manono Lithium and Tin Project in the south of the DRC in central Africa.
AVZ managing director Nigel Ferguson said: “We are excited with the progress of welcoming Yibin Tianyi as AVZ’s strategic partner following shareholder’s approval.
“The conditions precedent are progressing well and we expect all matters to be satisfied, including regulatory approvals by the end of the month.
“We were well received by Pei Zhen Hua, Yibin Tianyi’s chairman and his management team in China last week and we thank them for their hospitality.
“We look forward to completing this placement and also settling a binding offtake arrangement.
“Yibin Tianyi’s intention to become one of the largest hydroxide suppliers in China certainly compliments AVZ’s vision of developing the largest hard rock lithium deposit in the world.”
AVZ’s visit to China was led by MD Nigel Ferguson and project director Michael Hughes and included a visit to Yibin Tianyi’s lithium chemical plant, which is under construction and anticipated to begin production by June 2020.
Yibin Tianyi’s lithium chemical plant is targeting initial production of up to 25,000 tonnes of lithium hydroxide per annum.
Staged expansion plans are in place to further increase annual lithium hydroxide production to about 100,000 tonnes, which would make Yibin Tianyi’s plant one of the largest hydroxide suppliers in China.
Who leads AVZ Minerals?
The company is led by managing director Nigel Ferguson, a geologist with 32 years’ industry experience.
Ferguson has held senior management roles for the past 20 years and is a director of Okapi Resources Ltd (ASX:OKR) and AJN Resources Corp.
Technical director Graeme Johnston has more than 30 years’ experience in Australia, the Middle East, Romania and Malaysia having previously worked with Rio Tinto and Midwest Corporation.
Manono is managed by project director Michael Hughes whose experience covers metals and minerals commodity plant design and construction works in countries such as India, France, Malawi, Mozambique, Madagascar and Ethiopia.
What does AVZ Minerals own?
The key asset is the 188 square kilometre Manono Lithium-Tin Project which AVZ bought into in 2017 for $6.57 million.
The company owns 60% while the state-owned enterprise Cominiere (La Congolaise d’Exploitation Miniere SA) has 30% and the original seller, private company Dathomir Mining Resources SARL continues to hold 10%.
AVZ remains on track for completing the definitive feasibility study at Manono later this quarter with the dewatering of the Roche Dure pit having entered its final stages and positive results received from the phase II metallurgical test work.
Other ongoing work includes that related to the power supply, transport studies and increasing ownership in the project.
Ferguson said: “We continue to investigate our export routes and are looking to secure DRC Government benefits by way of supportive tax incentives and exemptions in early 2020.
“Furthermore, we are in ongoing discussions with a number of interested parties around longer-term partnerships involving offtake and debt financing.
“It is expected that the completion of the DFS will solidify these discussions into meaningful financing of the project.”
The company also owns a 100% interest in the surrounding Manono Extension Project which covers around 242.25 square kilometres.
- Condition precedent matters are progressing well and are expected to be satisfied by the end of January 2020;
- Regulatory approvals are also expected to be completed by the end of January 2020;
- Finalisation of the definitive feasibility study, including ongoing tests;
- Offtake and partnership discussions with Yibin Tianyi Lithium Industry Co Ltd.