Mineral Resources Limited (ASX:MIN), operator has a 30% stake, Ganfeng Lithium Co., Ltd a 43% stake and Neometals a 27% holding in the project.
The project is on schedule to achieve first production during 2016 which is timely as the price of lithium compounds remains high due to constrained supply during sustained strong growth in demand from renewable energy storage and electric/hybrid vehicle sectors.
During the March quarter, 208 reverse circulation holes were drilled for a total of 20,404 metres and 10 diamond holes were drilled for a total of 525 metres.
Drilling aims to extend the open‐pitable mine life through the extension to and in‐fill drilling of existing deposits.
A new resource estimate is planned for the June quarter, with an ore reserve estimate due in the September quarter.
Mt Marion Lithium Project
Mt Marion is a globally significant lithium deposit, containing total Indicated and Inferred Mineral Resources of 23.24 million tonnes at 1.39% Li2O and 1.43% Fe2O3.
During the March quarter, the project operator, Mineral Resources continued the construction phase of the project.
All site preparation work, installation of site offices and amenities, detailed engineering design work and construction of concrete civil works for the dry plant were completed.
Overburden stripping is well progressed and the haul road to pit 1 is close to completion and on schedule according to mine start up plan.
The first ore delivery to the ROM expected in early May, once the haul road is operational.
The company recently expanded its board with the appointment of two new independent directors effective from 14 April 2016, Doug Ritchie and Natalia Streltsova.
Ritchie is a senior resources industry executive with over 35 years experience, including over 28 years working with Rio Tinto in various senior management roles.
Streltsova is a PhD qualified chemical engineer with over 25 years experience in the minerals industry and an extensive background in mineral processing and hydrometallurgy across a range of commodities relevant to Neometals.
Neometals ended the March quarter with a healthy $65.3 million cash in the bank and paid out $11.2 million in dividends during April.
The company's share price is up circa 120% year to date, trading around $0.38.
Neometals continues to remain in the small class of near term ASX lithium oxide mineral producers.
Catalysts for the stock over the coming months include:
- Ongoing drilling and progress updates at Mt Marion;
- Mt Marion resource upgrade;
- Buying back of the company's shares as part of the ongoing A$5 million program;
- Completion of the definitive feasibility study at the Lithium Hydroxide Project; and
- Completion of legal agreements for use of proprietary technology at the Barrambie Titanium Project.
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