LithiumBank Reports US$2.7 Billion Pre Tax NPV From Preliminary Economic Assessment on a 31,350 TPA LHM Operation at Boardwalk Lithium Brine Project, Alberta, Canada
LithiumBank Reports US$2.7 Billion Pre Tax NPV From Preliminary Economic
Assessment on a 31,350 TPA LHM Operation at Boardwalk Lithium Brine
Project, Alberta, Canada
CALGARY, Alberta, May 25, 2023 -- LithiumBank Resources Corp. (TSX-V: LBNK) (OTCQX: LBNKF) (“LithiumBank” or
the “Company”) is pleased to announce the highlights from the initial Preliminary Economic Assessment (“PEA”) for the
Boardwalk lithium brine project located in west-central Alberta, Canada. The completed NI 43-101 PEA Technical Report will
be filed on SEDAR within 45 days of this announcement.
Boardwalk Highlights 1
• 31,350 metric tonnes per year of battery grade lithium hydroxide monohydrate (“LHM”) 2 over a 20-year period, the
largest proposed LHM production in North America
• USD $2.7 Billion NPV8 and 21.6% IRR on a pre tax basis
• USD $1.7 Billion NPV8 and 17.8% IRR on an after tax basis
• OPEX of USD $6,807/tonne LHM
• Direct Lithium Extraction (“DLE”) used to process Boardwalk brine will require less fresh water and have a surface
footprint that is a fraction of hard rock or evaporation lithium production.
• Located in Tier 1 jurisdiction, west-central Alberta, that has a long history of resource extraction, well established
infrastructure, and an actively supportive government.
• Power to be generated on site using high-efficiency gas turbines with steam cogeneration that will lower the project’s
overall carbon footprint. The proposed gas turbine units may be run on 80% hydrogen when a reliable supply is
available.
• Multiple opportunities to significantly enhance project economics through optimization, further engineering, and pending
incentive tax credit.
• Project economics used USD $26,000/t LHM and provides strong leverage to higher lithium prices.
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1 Readers are cautioned that reliance on information in this announcement without reference to the Technical Report may not
be appropriate. The forthcoming Technical Report is meant to be read as a whole, and sections should not be read or relied
upon out of context.
2 31,350 metric tonnes lithium hydroxide monohydrate (“LHM”) is equivalent to 28,000 metric tonnes lithium carbonate
equivalent (“LCE”)
“We are very pleased to provide one of a handful of economic studies of DLE based lithium projects in the world. Over the last
15 months, our PEA has rigorously tested or assessed over a dozen DLE technologies, completed multiple trade off studies
and has established Boardwalk as an economically viable project in the new post-pandemic financial environment,”
commented Paul Matysek, Executive Chairman LithiumBank. “Boardwalk is unique with an uncomplicated mineral title
containing a 6.2M tonne LCE brine resource that has the potential to produce battery grade LHM for 20 years, right here in
North America. Furthermore, there is potential for substantial upside on these economics from the recently announced
Canadian Investment Tax Credit and other numerous optimization opportunities.”
Near Term PEA Enhancements
• The Government of Canada announced an Investment Tax Credit (ITC) for Clean Technology Manufacturing in its Budget
2023. Refundable tax credit will be applied on capital expenditures for the extraction and processing of critical minerals
(ITC link).
• Use of smaller electrical submersible pumps (ESPs) that could fit in reduced diameter well casing throughout the
network that would significantly reduce capital expenditures.
• Leveraging of existing wells and surface infrastructure including roads, well pads, pipelines, and utilities.
• Reduction of well and power requirements through enhanced 3-D reservoir modelling and new drilling information.
• Next generation sorbent being developed by Conductive, the provider of the lithium brine DLE technology chosen for the
PEA, is expected to reduce costs, increase efficiency and reduce reagent consumption.
• Alternative DLE technology trade-off studies.
• Utilise ZS2 Technologies Inc. to capture and sequester CO 2 emissions to produce carbon credits, extract magnesium
from barren brine to produce low carbon cement products that will lower brine reinjection amounts by at least 10%.
• Additional trade-off studies aimed at streamlining pipeline infrastructure.
“The Boardwalk PEA marks a significant milestone for LithiumBank” commented Rob Shewchuk CEO & Director of
LithiumBank. “It sets the stage for our team to now pursue lithium resource development in Western Canada with a
significantly enhanced ESG profile compared to other forms of lithium mining. We will leverage this PEA to expedite an
additional PEA on Park Place lithium brine project only 50 km to the south. By the end of 2023, we expect to commence pilot
plant studies on both Boardwalk and Park Place in tandem. In parallel, we will be working to capture the near-term
enhancement opportunities we have already identified in this study that we expect to drive significant incremental NPV and
IRR performance. We believe this has the potential to position both the Boardwalk and Park Place districts among the most
attractive direct brine projects in North America.”
Boardwalk PEA
Introduction
The Boardwalk PEA was compiled by Hatch Ltd. (“Hatch”) integrating the work of Hatch and other consultants each having the
qualifications necessary to author their respective sections of the PEA. Since their founding in 1955, Hatch has successfully
designed numerous large scale industrial projects throughout North America and the world.
LithiumBank Resources Corp. is a lithium brine exploration and development company that is focused on developing their
flagship projects in western Canada. The Boardwalk project is based on a lithium hydroxide monohydrate (“LHM”) plant that
will use Direct Lithium Extraction (“DLE”) technology. The in-situ lithium-rich brine will be pumped to a processing facility from
the Leduc well-field shown in Figure 6. The PEA contemplates the brine will be treated using Conductive Energy Inc.'s Ion
Exchange (“IX”) sorbent that will selectively extract lithium from the brine. After passing through the extraction process, the
concentrated lithium brine stream undergoes further processing steps including purification, concentration and conversion to
produce commercial battery grade lithium hydroxide monohydrate shown in Figure 7.
Economic Analysis
The base case assumes a long term LHM price of US$26,000/t. At this price the project achieves a positive NPV of $2.7
billion on a pre-tax basis at an 8% real discount rate. A summary of key indicators is shown in Table 1 .
Table 1 - Boardwalk Economic Summary
Description Unit Value
LHM Sales t/year 31,350
LHM Price US$/t 26,000
Site Operating Unit Cost US$/t sold 6,941
Site Operating Cost US$M/year 214
EBITDA US$M/year 586
Project Life years 20
Initial Capital Cost US$M 2,092
Sustaining Capital Cost US$M 129
USD/CAD Exchange Rate US$/C$ 0.74
Pre-tax NPV @ 8% US$M 2,722
After-tax NPV @ 8% US$M 1,657
Pre-tax IRR % 21.6
After-tax IRR % 17.8
Pre-tax Payback operating years 4.1
After-tax Payback operating years 4.5
The preliminary economic assessment is inherently preliminary in nature. It includes inferred mineral resources that are too
speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral
reserves, and there is no certainty that the results indicated in this preliminary economic assessment will be realized.
Capital and Operating Cost Estimates
The Capital Expenditure (CAPEX) Estimate was prepared in accordance with the Association for the Advancement of Cost
Engineering (AACE) Class 5 Study standards, and has an approximate accuracy of +50%, -30%.
The total estimated CAPEX for the project is presented in table 2 below, inclusive of contingency.
Table 2 - Capital Cost Estimate Summary
Description Estimated Cost
(M USD)
Plant Wide - General $22.90
Onsite Infrastructure $264.90
Offsite Infrastructure $18.90
Brine Wellfield Services $276.30
Surface Brine Infrastructure $208.70
Lithium Processing Plant $574.80
Direct Cost - Subtotal $1,366.60
Indirect Cost $311.40
Contingency $359.50
Owner’s Cost $54.70
Total Project Capital Cost $2,092.10
The Operating Expenditure (OPEX) Estimate for the project was also prepared in accordance with the AACE Class 5 Study
standard. The total OPEX is presented below in table 3.
Table 3 - Operating Cost Summary
Cost Component
Lithium Plant
Annual
Operating Cost
(M USD)
Lithium Plant
Unit Operating
Cost
(USD/t
LHM)
% of total
OPEX
Reagents 117.5 3,689 54%
Utilities 47.2 1,480 22%
Consumables 4.9 154 2%
Labour 16.3 513 8%
Maintenance Materials and Services 20.6 646 9%
Transport and Logistics 3.6 114 2%
General and Administrative (G&A) 6.7 210 3%
Total Operating Cost 216.9 6,807 100%
Returns are highly sensitive to input assumptions and should be viewed in the context of the sensitivity analysis provided in
figures 1 through 4 as well as the stated accuracies for items such as capital costs.
Figure 1: NPV @ 8% Pre-Tax Sensitivity
Figure 2 - NPV @ 8% Discount Rate After-Tax Sensitivity
Figure 3: IRR Pre-Tax Sensitivity
Figure 4 - IRR After-Tax Sensitivity
Lithium Demand
Lithium-ion battery demand has grown substantially in recent years as electric vehicle (EV) adoption has strengthened and
energy storage systems (ESS) have grown in popularity. EV batteries are forecast to become the primary driver for lithium
chemical demand, with Wood Mackenzie 3 projecting demand in 2032 to be over twelve times higher than 2020 levels, as
shown in Figure 5. EV demand growth is expected from passenger vehicles, with global sales forecast to increase 22% per
year from 2020 to 2030 4. EV manufacturers are increasingly making direct investments in Lithium projects especially in
politically stable resource friendly jurisdictions.
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3 The data and information provided by Wood Mackenzie should not be interpreted as advice and you should not rely on it for
any purpose. You may not copy or use this data and information except as expressly permitted by Wood Mackenzie in
writing. To the fullest extent permitted by law, Wood Mackenzie accepts no responsibility for your use of this data and
information except as specified in a written agreement you have entered into with Wood Mackenzie for the provision of such
data and information. The foregoing chart was obtained from Battery & raw materials – Investment horizon outlook to 2032 (Q4
2022)™, a product of Wood Mackenzie.
4 The foregoing information was obtained from Lithium market 2021 outlook to 2050™, a product of Wood Mackenzie.
Figure 5: Total Battery Demand by End-Use (TWh) (Wood Mackenzie, 2022) 3
Mineral Resource and Reserve Estimates
The Boardwalk Leduc Formation Li-brine resource estimate is classified as indicated and inferred mineral resources in
accordance with the Canadian Institute of Mining, Metallurgy and Petroleum definition standards and best practice guidelines
(2014, 2019) and the Canadian Securities Administration’s Standards for Disclosure of Mineral Projects, National Instrument
43-101.
The indicated and inferred Boardwalk Leduc Formation lithium-brine resource estimations are presented as a total (or global
value), and were estimated using the following relation in consideration of the Leduc Formation aquifer brine:
Lithium Resource = Total Brine Aquifer Volume X Average Porosity X Percentage of Brine in the Pore Space X Average
Concentration of Lithium in the Brine.
The indicated mineral resource area is defined by the outline of the Sturgeon Lake South Oilfield. The resource classification
within the Sturgeon Lake South Oilfield is elevated to an indicated mineral resource due to 1) the correlation of historical Li-
brine data in conjunction with 2021-2022 brine analytical work conducted by LithiumBank; 2) reinterpretation of 2-D seismic
data and understanding of the dimensions of the Leduc Formation reef buildups; and 3) mineral processing test work – all of
which have advanced the confidence level of the Li-brine concentration, geological model and potential for recovery of lithium
from the brine. The inferred mineral resource area is defined by the remaining area of the Sturgeon Lake Reef Complex that is
situated outside of the indicated mineral resource area.
Three-dimensional wireframes of the Leduc Formation aquifer were created using the grid surfaces of the top and base of the
Leduc Formation within the 3-D geological model. The 2-D strings were connected to create a solid 3-D wireframe of the Leduc
Formation aquifer within the resource areas. Only those parts of the Sturgeon Lake Reef Complex that occur within the
permitted LithiumBank Boardwalk Property were used in the resource estimate process. The 3-D closed solid polygon
wireframe of the Leduc Formation aquifer domain was used to calculate the volumes of rock, or the aquifer volumes. The
aquifer volumes underlying the Boardwalk Property, summarized as the total Leduc Formation domain aquifer volumes, are
19.83 km3 and 308.93 km3 in the indicated and inferred resource areas, respectively.
The brine volumes are calculated for the Leduc Formation aquifer domain, or resource areas, by multiplying the aquifer volume
(in km 3) times the average porosity times the percentage of brine assumed within the pore space. Using an average effective
porosity value of 5.3% and an average modal abundance of brine in the Leduc Formation pore space percentage of 98%, the
indicated and inferred resource brine volumes are 1.03 km3 and 16.05 km3, respectively.
Average Leduc Formation aquifer brine lithium concentrations of 71.6 milligrams per liter (mg/L) Li and 68.0 mg/L Li were
selected for the calculation of the indicated and inferred resource estimations. These values were determined from a lithium
assay database of 25 ICP-OES analyses conducted by LithiumBank’s primary lab (indicated resource area) and 89
LithiumBank and historical ICP-OES analyses (inferred resource area). The quality of the average lithium concentrations was
assessed and is considered to represent high levels of analytical precision.
The Li-brine resources were estimated using a cut-off grade of 50 mg/L lithium. With respect to units of measurement, 1 mg/L
= 1 g/m 3. If concentration is in mg/L and volume in m 3, then the calculated resource has units of grams. (1 g/m 3 x 1 m 3 = 1
gram or 0.001 kg).
The Updated Boardwalk Leduc Formation Li-brine indicated resource estimate is globally estimated at 74,000 tonnes of
elemental Li (Table 4). The global (total) lithium carbonate equivalent for the main resource is 393,000 tonnes.
The Updated Boardwalk Leduc Formation Li-brine inferred resource estimate is globally estimated at 1,091,000 tonnes of
elemental Li (Table 5). The global (total) lithium carbonate equivalent for the main resource is 5,808,000 tonnes.
The mineral resources reported here and used in the PEA are unchanged from the updated resource estimate titled “Updated
Indicated and Inferred Resource Estimates for LithiumBank Resources Corp.’s Boardwalk Lithium-Brine Project in West-
Central Alberta, Canada” effectively dated December 20, 2022.Mineral resources are not mineral reserves and do not have
demonstrated economic viability. There is no guarantee that all or any part of the mineral resource will be converted into a
mineral reserve. The estimate of mineral resources may be materially affected by geology, environment, permitting, legal, title,
taxation, socio-political, marketing, or other relevant issues.
Table 4 - Boardwalk Indicated Li—brine resource estimation presented as a global (total) resource contained
within the Leduc Formation of the Sturgeon Lake South Oilfield.
Note 1: Mineral resources are not mineral reserves and do not have demonstrated economic viability.
Note 2: The weights are reported in metric tonnes (1,000 kg or 2,204.6 lbs).
Note 3: Tonnage numbers are rounded to the nearest 1,000 unit.
Note 4: In a ‘confined’ aquifer (as reported herein), porosity is a proxy for specific yield.
Note 5: The resource estimation was completed and reported using a cutoff of 50 mg/L Li.
Note 6: To describe the resource in terms of industry standard, a conversion factor of 5.323 is used to convert elemental Li to
Li2CO3, or Lithium Carbonate Equivalent (LCE).
Table 5 - Boardwalk Inferred Li—brine resource estimation presented as a global (total) resource that is contained
within the Leduc Formation that encompasses the Sturgeon Lake Reef Complex outside of the Sturgeon Lake
South Oilfield (or area of the Indicated mineral resource).
Note 1: Mineral resources are not mineral reserves and do not have demonstrated economic viability
Note 2: The weights are reported in metric tonnes (1,000 kg or 2,204.6 lbs).
Note 3: Tonnage numbers are rounded to the nearest 1,000 unit.
Note 4: In a ‘confined’ aquifer (as reported herein), porosity is a proxy for specific yield.
Note 5: The resource estimation was completed and reported using a cutoff of 50 mg/L Li.
Note 6: To describe the resource in terms of industry standard, a conversion factor of 5.323 is used to convert elemental Li to
Li2CO3, or Lithium Carbonate Equivalent (LCE).
Property Description
The Boardwalk Property is located in west-central Alberta, Canada, directly south and west of the Town of Valleyview,
approximately 85 km east of the City of Grande Prairie and 270 km northwest of the City of Edmonton (Figure 6). The
Boardwalk Project, within the Boardwalk property, and shown on Figure 6 & 7 as the “Boardwalk Production Zone”
encompasses approximately 30,000 ha of the south and eastern portion of the Sturgeon Lake Leduc reef.
Figure 6: Location map the Boardwalk lithium brine project.