KEY POINTS
- Winsome Resources confirms the strong potential of its Adina lithium project in Quebec, Canada.
- The project is forecasted to generate $7.5 billion in revenue over 17 years.
- The scoping study shows a post-tax net present value of $743 million and a payback period of 1.8 years.
Australia’s Winsome Resources (ASX: WR1) has confirmed the potential of its Adina lithium project in Quebec, Canada, with a scoping study revealing that the $259 million project could be a cost-efficient mine with a productive life of 17 years.
The study highlights the strategic benefits of repurposing infrastructure from the Renard diamond mine, which the company aims to acquire.
The acquisition of the Renard mine and its existing infrastructure, such as dense media separation (DMS) and ore sorting facilities, would significantly reduce costs for developing the Adina project.
This move is expected to save Winsome Resources both time and capital, with the project forecast to produce 282,000 tonnes of 5.5 percent spodumene concentrate annually, equivalent to 38,000 tonnes of lithium carbonate over the mine’s life.
Efficient operations and competitive advantages
Chris Evans, managing director of Winsome Resources, emphasized that the ease of mining mineralized material at Adina, combined with the cost-effective use of the Renard infrastructure, places the project in a strong competitive position.
According to Mining.com, the Adina mine is projected to weather market fluctuations and commodity cycles, thanks to its operational efficiency and low-cost production. The scoping study shows robust financial metrics, including a post-tax net present value of $743 million, an internal rate of return of 43 percent, and a payback period of 1.8 years.
With an average all-in sustaining cost of $693 per tonne and a spodumene concentrate price forecast at $1,375 per tonne, the project presents a lucrative opportunity for the company. These figures align with estimates from neighboring lithium projects, such as Patriot Battery Metals’ Shaakichiuwaanaan project.
Investment and economic impact
The Adina project is expected to have a significant economic impact, potentially generating over $7.5 billion in gross revenue and creating around 500 jobs during its operational phase. Winsome Resources also projects that the project could contribute $1.1 billion in taxes to both the Quebec provincial and Canadian federal governments, benefiting local communities.
In addition to advancing the permitting process for Adina, Winsome Resources is conducting due diligence on the Renard mine. The existing infrastructure at Renard, which received approximately C$900 million in investments between 2016 and 2023, offers a solid foundation for future lithium production.
The company remains optimistic about the project’s commercial viability, despite current challenges in the global lithium market. Shares in Winsome Resources surged following the announcement, closing at A$0.52, giving the company a market capitalization of A$112.5 million ($76 million).
