EMP update lifts high-grade lithium resource by 78%

A resource update for EMP Metals’ (CSE: EMPS; US-OTC: EMPPF) Viewfield and Mansur sites in Saskatchewan boosted total tonnage by more than 78% over a 2023 preliminary economic assessment (PEA). Shares jumped.

The projects now total 931,038 indicated tonnes of lithium carbonate equivalent (LCE) grading 141 mg per litre lithium and 1.11 million inferred tonnes LCE at 112 mg per litre lithium, EMP reported Tuesday. Viewfield, in southeast Saskatchewan, is about 40 km southeast of Mansur. The two projects already boasted some of the highest grade lithium brine resources on the Prairies before the update.

“We have been well rewarded for the risk taken in completing the first lithium exploration horizontal well drilled in Canada,” EMP CEO Karl Kottmeier said in a release. “The large increase in our resource, without sacrificing the lithium grade, is also a huge achievement and a further confirmation of our high-quality brine.”

6-month high

EMP shares jumped 21.5% to 40¢ apiece on Tuesday morning in Toronto, the stock’s highest level in six months, for a market capitalization of $45.25 million. The stock has traded in a 12-month range of 21¢ to 58¢.

The resource increase comes as lithium brine projects continue to advance in Alberta and Saskatchewan amid a weeklong rally for the metal. Arizona Lithium’s (ASX: AZL) Prairie site in Saskatchewan became the first Canadian brine project to gain approval for production in May. Other key brine players on the Prairies include E3 Lithium (TSXV: ETL; US-OTC: EEMMF) and Volt Lithium (TSXV: VLT) in neighbouring Alberta. 

Battery giant Contemporary Amperex Technology suspended production last week at a major lithium mine in China, sparking supply concerns and raising prices of the metal higher compared to prices since April. Lithium carbonate prices remain in a slump after losing about 85% of their value since 2022.  

EMP’s resource update is based on drilling and test results from three vertical and one horizontal test well sunk by EMP, the company said.

23-year life

Viewfield could produce 12,175 tonnes of LCE annually grading 128 mg per litre over a 23-year life, according to the company’s PEA. Its after-tax net present value (at an 8% discount) is estimated at about $1 billion (C$1.37 billion), with an internal rate of return of 45%. Capital costs are pegged at $571 million, including a contingency of US$52 million. Capex could be repaid over 2.1 years.

Vancouver-based EMP signed an agreement with Saltworks Technologies in May to build and operate a lithium refining demonstration plant at Viewfield.