European Lithium Ltd - Quarterly Report
RNS Number : 2414N
European Lithium Limited
16 January 2019
 

European Lithium Ltd

("European Lithium", "EUR" or "the Company")

QUARTERLY REPORT FOR THE QUARTER ENDING 31 DECEMBER 2018

The Board of European Lithium Limited (ASX: EUR, FRA: PF8, VSE: ELI, NEX: EUR) (the Company) is pleased to present its activities report and Appendix 5B for the three months ending 31 December 2018.

The full announcement and ASX lodgments, including the Appendix 5B, can be seen on the Company's website at: https://europeanlithium.com/announcements/

SUMMARY OF KEY UPDATES

·  Contract to Dorfner/Anzaplan has been awarded for the metallurgical test work and pilot processing

·     Drilling program in Zone 1 continued to confirm 10.98 mt JORC resource

·     European Lithium lists on the NEX Exchange Growth Market in London

 

CORPORATE MATTERS

Financing Facility

As previously announced, the Company has a A$10m finance facility with MEF I, L.P. (Magna or Investor) to fast-track the completion of a DFS at the Wolfsberg Lithium Project in Austria

An initial amount of A$2.5m was drawn down on 14 September 2018 and a further A$7.5m is available in tranches upon the Company meeting key milestones relating to the DFS process.

The finance facility is by the issue of convertible securities in the Company.  The convertible notes are convertible at any time by the Investor at the lower of A$0.30 or a 15% discount from the lowest VWAP over ten (10) days prior to the conversion date, provided that the conversion price shall not in any case be lower than A$0.08 (revised floor price).

During the quarter, Magna converted 100,000 notes on 1 November 2018 and a further 100,000 notes on 14 December 2018.

NEX Listing

On 26 November 2018, the Company's ordinary shares were admitted for trading on the London based NEX Exchange Growth Market (NEX) under the ticker symbol EUR.

To facilitate trading of the Company's shares on NEX, EUR has established a Depositary Interest (DI) facility under which it has appointed Computershare Investor Services Plc (Computershare UK) as the depositary.  Securities of Australian issuers such as EUR's cannot be directly registered, transferred or settled through CREST (which is the electronic settlement system in the UK).  The DI facility overcomes this by creating entitlements to EUR's shares (the DIs), which are deemed to be UK securities and therefore admissible to CREST.  The underlying shares are listed and traded on NEX, while the DIs are transferred in CREST to settle those trades.

If shareholders choose to move their securities to the UK to trade/or hold and become the holder of DIs, their shares are no longer held in their name on EUR's Australian share register. Instead they are held by Computershare UK's Australian custodian.  DI holders become the beneficial holder of those EUR shares, with the DIs held on EUR's UK DI register in CREST on their behalf by their broker.

Vienna Listing

As previously announced, the Company is investigating listing on the Prime Market of the Vienna Stock Exchange (VSE).  The Company continues to work with its Austrian lawyers Brandl & Talos Rechtsanwälte GmbH on the VSE listing.

Capital Movements

During the quarter, the Company issued the following securities:

§ 1 November 2018 - 1,550,824 shares issued to Magna as partial conversion of convertible notes (as outlined above)

§ 6 December 2018 - 350,000 shares issued to the Company's Project Director Mr Christian Heili as a sign-on bonus pursuant to a contracting agreement

§ 11 December 2018 - 11,250,000 unlisted options exercisable at $0.15 each on or before 31 May 2019 issued to Directors as approved at the Company's 2018 AGM

§ 11 December 2018 - 2,500,000 unlisted options exercisable at $0.20 each on or before 11 December 2021 issued to Empire Capital as approved at the Company's 2018 AGM

§ 14 December 2018 - 1,695,515 shares issued to Magna as partial conversion of convertible notes (as outlined above)

 

EXPLORATION AND DEVELOPMENT ACTIVITIES

Wolfsberg Lithium Project

Drilling

Mobilisation of equipment onto site has been completed for the drilling program to convert the Zone 1 10.98mt JORC resource into Measured and Indicated category.  Applications for the drilling have been lodged with the relevant authorities and drilling collar locations and pads for the 31-drill hole programme have been surveyed by a licensed surveyor.  Approval from the authorities is expected to be received in Q1 2019 following which drilling is targeted to commence immediately.

Definite-Feasibility Study (DFS)

As previously announced, The Mineral Corporation (TMC) has completed the definition of the scope of work for the DFS, based on the results of the PFS being published in April 2018.

The PFS had identified areas in geology, hydrogeology, mining, metallurgy, land access and environmental to be investigated for the DFS so that design changes during the DFS will be minimised.

As outlined above, a drilling program is underway to convert the 10.98mt JORC resource into Measured and Indicated category.  The Zone 1 drilling programme to increase the Measured and Indicated Resource would allow the DFS to be undertaken at the envisaged higher mining rate of max. 800,000tpa.

During the quarter, TMC together with DRA Global (DRA) completed the scope of works for the DFS project engineering design and integration of third-party studies into the DFS.  SRK Consulting (SRK) has also prepared the scope of work for the optimized mine design and increased declaration of mineral reserves, based on the PFS and current drilling program results when completed.

In December 2018, the Company awarded to Dorfner/Anzaplan the contract for complex metallurgical test work and pilot processing with work commenced immediately.  The awarding of this contract is a key milestone in order to complete the DFS in a timely manner.

The Company has sent a 300t sample with 150 t each for Amphiboltite Hosted Pegmatite (AHP) and Micaschist Hosted Pegmatite (MHP) to Dorfner Anzaplan's German testing facilities to commence the detailed metallurgical process studies through the pilot plant.  This testing is to ensure a high-quality final product (LithiumHydroxide) is produced using the most efficient and competitive metallurgical processes from the beginning of the production cycle.

Hydrogeology

The Company continues to monitor hydrogeological baseline activities as follows:

§ Weekly: measuring the water level in surface and underground measuring sides including drill holes and creeks

§ Monthly: measuring specific chemical and physical parameters (e.g., temperature, pH-value, conductivity, redox potential) at the surface and underground measuring sides

§ Quarterly: taking samples from the mine and surface water measuring sides and sending them to Agrolab, an Austrian lab specialized in water analysis. Agrolab is analyzing the samples based on the criteria of the Austrian drinking water ordinance

Data from the above activities is fed into a water measuring database from which an annual report is produced.

Environmental

During the quarter, Umweltbüro completed additional Biotope mapping and presented the final reports covering possible sensitive flora and fauna species.

Monitoring of water flows and quality from the mine continue.

Product Marketing  

The marketing study undertaken by Benchmark Minerals Intelligence as part of the PFS projected that lithium hydroxide prices in Europe would continue to increase from the present level to a peak in 2022 and then decline to stabilise. Taking recent global lithium industry developments into account, the strategy for the company remains unchanged and focuses on the supply of lithium hydroxide to the nascent lithium battery plants of Europe. The Company is in discussion with a number of these regarding future off-take contracts and good progress has already been made in the advanced discussions with potential off-take partners.

 

Horizon 2020

The Company's 100% owned subsidiary ECM Lithium AT GmbH (ECM) has been invited to participate in the European Union funded Horizon 2020 - GREENPEG programme.  The Horizon 2020 - GREENPEG project aims to develop innovative exploration toolsets and proprietary technologies in order to secure the sustainable supply of lithium and other critical raw materials to Europe by increasing their resources and reducing the import dependency of these raw materials.  ECM will submit in Q1 2019 the first of the two-stage submission process outlining suggested and planned works.

 

 

Tony Sage

Non-Executive Chairman

 

 

Competent Person's Statement

The information in this announcement pertaining to the Wolfsberg Lithium Project, and to which this statement is attached, relates to Project Development and Metallurgical  Studies and is based on and fairly represents information and supporting documentation provided by the Company and its Consultants and summarized by Dietrich Wanke who is a Qualified Person and is a Member of the Australian Institution of Mining and Metallurgy (AusIMM) since  2006 with about 30 years' experience in the mining and resource development industry. Dietrich Wanke has sufficient experience, as to qualify as a Competent Person as defined in the 2012 edition of the "Australian Code for Reporting of Mineral Resources and Ore reserves". Dietrich Wanke consents to the inclusion in the report of the matters based on information in the form and context in which it appears. The company is reporting progress on project development and metallurgical results under the 2012 edition of the Australasian Code for the Reporting of Results, Minerals Resources and Ore reserves (JORC code 2012).

 

Tenement Status

The mining tenements held at the end of the quarter, acquired and disposed of during the quarter and their location:

Tenement reference

Location

Acquired interest during the quarter

Disposed interest during the quarter

Interest at the end of the quarter

104/96

Wolfsberg Project, Austria

-

-

100%

105/96

Wolfsberg Project, Austria

-

-

100%

106/96

Wolfsberg Project, Austria

-

-

100%

107/96

Wolfsberg Project, Austria

-

-

100%

108/96

Wolfsberg Project, Austria

-

-

100%

109/96

Wolfsberg Project, Austria

-

-

100%

110/96

Wolfsberg Project, Austria

-

-

100%

111/96

Wolfsberg Project, Austria

-

-

100%

112/96

Wolfsberg Project, Austria

-

-

100%

113/96

Wolfsberg Project, Austria

-

-

100%

114/96

Wolfsberg Project, Austria

-

-

100%

115/96

Wolfsberg Project, Austria

-

-

100%

116/96

Wolfsberg Project, Austria

-

-

100%

117/96

Wolfsberg Project, Austria

-

-

100%

118/96

Wolfsberg Project, Austria

-

-

100%

119/96

Wolfsberg Project, Austria

-

-

100%

120/96

Wolfsberg Project, Austria

-

-

100%

121/96

Wolfsberg Project, Austria

-

-

100%

122/96

Wolfsberg Project, Austria

-

-

100%

123/96

Wolfsberg Project, Austria

-

-

100%

124/96

Wolfsberg Project, Austria

-

-

100%

125/96

Wolfsberg Project, Austria

-

-

100%

370/11(611/11)

Wolfsberg Project, Austria

-

-

100%

371/11(612/11)

Wolfsberg Project, Austria

-

-

100%

372/11(613/11)

Wolfsberg Project, Austria

-

-

100%

373/11(614/11)

Wolfsberg Project, Austria

-

-

100%

374/11(615/11)

Wolfsberg Project, Austria

-

-

100%

375/11(616/11)

Wolfsberg Project, Austria

-

-

100%

378/11(619/11)

Wolfsberg Project, Austria

-

-

100%

379/11(620/11)

Wolfsberg Project, Austria

-

-

100%

380/11(621/11)

Wolfsberg Project, Austria

-

-

100%

381/11(622/11)

Wolfsberg Project, Austria

-

-

100%

382/11(623/11)

Wolfsberg Project, Austria

-

-

100%

383/11(624/11)

Wolfsberg Project, Austria

-

-

100%

384/11(625/11)

Wolfsberg Project, Austria

-

-

100%

386/11(627/11)

Wolfsberg Project, Austria

-

-

100%

387/11(628/11)

Wolfsberg Project, Austria

-

-

100%

388/11(629/11)

Wolfsberg Project, Austria

-

-

100%

389/11(630/11)

Wolfsberg Project, Austria

-

-

100%

390/11(631/11)

Wolfsberg Project, Austria

-

-

100%

391/11(632/11)

Wolfsberg Project, Austria

-

-

100%

392/11(633/11)

Wolfsberg Project, Austria

-

-

100%

394/11(636/11)

Wolfsberg Project, Austria

-

-

100%

395/11(637/11)

Wolfsberg Project, Austria

-

-

100%

396/11(638/11)

Wolfsberg Project, Austria

-

-

100%

397/11(639/11)

Wolfsberg Project, Austria

-

-

100%

398/11(640/11)

Wolfsberg Project, Austria

-

-

100%

400/11(645/11)

Wolfsberg Project, Austria

-

-

100%

401/11(646/11)

Wolfsberg Project, Austria

-

-

100%

402/11(647/11)

Wolfsberg Project, Austria

-

-

100%

403/11(648/11)

Wolfsberg Project, Austria

-

-

100%

408/11(648/11)

Wolfsberg Project, Austria

-

-

100%

409/11(641/11)

Wolfsberg Project, Austria

-

-

100%

412/11(649/11)

Wolfsberg Project, Austria

-

-

100%

Andreas 1

Wolfsberg Project, Austria

-

-

100%

Andreas 2

Wolfsberg Project, Austria

-

-

100%

Andreas 3

Wolfsberg Project, Austria

-

-

100%

Andreas 4

Wolfsberg Project, Austria

-

-

100%

Andreas 5

Wolfsberg Project, Austria

-

-

100%

Andreas 6

Wolfsberg Project, Austria

-

-

100%

Andreas 7

Wolfsberg Project, Austria

-

-

100%

Andreas 8

Wolfsberg Project, Austria

-

-

100%

Andreas 9

Wolfsberg Project, Austria

-

-

100%

Andreas 10

Wolfsberg Project, Austria

-

-

100%

Andreas 11

Wolfsberg Project, Austria

-

-

100%

 

- END -

 

Visit the Company's website to find out more about the advanced Wolfsberg Lithium Project located in Austria.

For further information please contact:

European Lithium Ltd

+61 861 819 792

Tony Sage

info@europeanlithium.com

 

 

NEX Corporate Adviser

+44 207 220 1666

James Joyce

 

James Sinclair-Ford

 

 

 

 

 

 

 

 


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