Lithium Ionic books 29% rise in resources at Bandeira project

Lithium Ionic grows Baixa Grande resource by 32%, boosting Brazil's lithium ambitions

Lithium Ionic’s Bandeira project with CBL’s Cachoeira mine in the background. Credit: Lithium Ionic.

An update for Lithium Ionic’s (TSXV: LTH) Bandeira project in eastern Brazil has lifted contained resources by about one-third over a feasibility study conducted last year.

Measured and indicated resources now total 27.27 million tonnes grading 1.34% lithium oxide (Li₂O) for 901,059 tonnes of lithium carbonate equivalent (LCE), compared with the 696,520 contained tonnes in last year’s study, the company reported Tuesday. Inferred resources for the project in Minas Gerais state logged a slight 1.9% increase to 18.55 million tonnes at 1.34% Li₂O, or 615,432 contained tonnes of LCE.

“Bandeira continues to grow substantially while maintaining consistent grade, further validating its robustness and scale potential,” Lithium Ionic CEO Blake Hylands said in a release. “This updated resource supports our mine planning efforts and will be an important input as we work through detailed engineering and evaluate future production scalability.”

Lithium doldrums

Battery-grade lithium carbonate prices remain in an almost-year long slump, and sat at $8,186.35 per tonne on Tuesday, according to Metal.com. Prices for the critical metal, an essential component in electric vehicle (EV) batteries, have fallen by more than 70% from their peak two years ago due to oversupply and slowing demand for EVs.

Some analysts foresee long term prices for lithium rising, with a potential rebound expected next year followed by an uptrend into the 2030s, according to a from January.

Lithium Ionic shares gained 1.4% to C$0.73 apiece on Tuesday morning in Toronto, for a market capitalization of C$116 million. The stock has traded in a 12-month range of C$0.41 to C$1.17.

Feasibility update

The update was based on 60,301 metres of drilling across 297 holes drilled between April 2022 and September 2024. Lithium Ionic plans to integrate the new resource into an updated feasibility study expected in the second half of this year.

Bandeira, located northeast of the city of Araçuaí and about 1,000 km north of Rio de Janeiro, has an after-tax net present value (at an 8% discount rate) of $1.3 billion and a post-tax internal rate of return of 40%. Initial capex is estimated at $266 million, including a 15% contingency. The after-tax payback period is pegged at 3.4 years.

The underground mine is forecast to produce about 17.2 million tonnes of LCE at 5.5% Li₂O over a 14-year life, starting in 2026, at spodumene prices of $2,277 per tonne.

The project claims sit across 1.6 sq. km, representing about 1% of the company’s 141.8-sq.-km land package in Brazil’s “Lithium Valley.” The area is also home to another Lithium Ionic project, Salinas, about 120 km north of Bandeira.