Perth, Jan 13, 2009 (ABN Newswire) - AUDIO: Emerging lithium producer, Galaxy Resources Limited (ASX:GXY) is pleased to announce the results of a Definitive Feasibility Study (DFS) completed for its Mt Cattlin Lithium-Tantalum project near Ravensthorpe.
The DFS has confirmed the economic and technical viability of the project which has a pre tax Net Present Value (NPV) of A$128 million (8% discount rate), a life of mine (LOM) average pre tax cash flow of A$26 million per annum and a capital cost of A$68 million.
The DFS has identified a phased start up for the project, which includes the establishment of a mine and minerals plant first as part of a lower capital cost, lower technical and financial risk strategy that will bring earlier cash flow. From the minerals plant, the company can produce spodumene concentrate to sell to current lithium carbonate producers as a feed or establish toll treating partnerships. An important by-product of the proposed operation is production of a high quality tantalite concentrate.
Galaxy Managing Director Iggy Tan said the Company committed to the completion of the DFS at the end of 2008 and this was achieved on time. The DFS results indicated that Mt Cattlin is a robust project with the potential to begin production during Quarter 3, 2010.
"We are delighted with the outcome of the DFS, which supports plans for a 1 million tonne mine and concentrator at Mt Cattlin," said Mr Tan.
"Two key factors in the positive results were the favourable characteristics of Galaxy's flat lying pegmatite resource and the attractive economics of processing a simple concentrate for the lithium carbonate producers," he said.
About Galaxy Resources Limited
Galaxy Resources Limited (ASX:GXY) (OTCMKTS:GALXF) is an international S&P / ASX 200 Index company with lithium production facilities, hard rock mines and brine assets in Australia, Canada and Argentina. It wholly owns and operates the Mt Cattlin mine in Ravensthorpe Western Australia, which is currently producing spodumene and tantalum concentrate, and the James Bay lithium pegmatite project in Quebec, Canada.
Galaxy is advancing plans to develop the Sal de Vida lithium and potash brine project in Argentina situated in the lithium triangle (where Chile, Argentina and Bolivia meet), which is currently the source of 60% of global lithium production. Sal de Vida has excellent potential as a low cost brine-based lithium carbonate production facility.
Lithium compounds are used in the manufacture of ceramics, glass, and consumer electronics and are an essential cathode material for long life lithium-ion batteries used in hybrid and electric vehicles, as well as mass energy storage systems. Galaxy is bullish about the global lithium demand outlook and is aiming to become a major producer of lithium products.