Each one in plain English, with the numbers worked through for a shareholder.
11 Aug 2023resource reserve update▲ GoodMajor
Snow Lake released its S-K 1300 Initial Assessment (prepared by ABH Engineering, with SLR as co-qualified person), showing a projected after-tax value of US$1.19 billion at a 7% discount rate, a 170% internal rate of return and a 14-month payback over a 9-year mine life. The updated resource is 748,632 t measured (1.13% Li2O), 6,560,006 t indicated (1.10%) and 1,007,119 t inferred (0.99%), well below the earlier 11.1 Mt figure; total capital is US$146 million including US$10 million closure. The company notes these are preliminary and rely on inferred resources; the board approved starting a pre-feasibility study and a winter drill program. This delivers the long-pending IA, and the 9-year mine life contrasts with the earlier 25-year target.
Snow Lake reported final results from its 2022 Grass River drilling, including 2.0% Li2O over 16 metres in hole CBP-007 and 3.6% over 1.5 metres in GRP-018, with all SGS Lakefield assays now received. SGS Lakefield's 3D modelling found at least three spodumene dykes (company staff think up to five), so the area is now called the 'GRP Dykes Swarm'; the north-west extension is the focus of the 2023 winter drilling. This resolves the earlier lab-backlog thread and continues the GRP starter-pit work, but no updated resource figure is given. A second release in the same filing (Jan 6, 2023) says the company staked nine claims (1,728 hectares) near Dion Creek, Lost Frog Lake and Grass River East, bringing total land to 24,114 hectares (59,587 acres), about 8% more than before.
Snow Lake signed a Memorandum of Understanding (a non-binding agreement, in general) with Epiroc Canada Inc. to advise on the technical and commercial design of its planned fully electric mine; no financial terms are given. It also reported TBL-038 at 1.53% Li2O over 24.94 m (the table shows 24.92 m), an infill hole to confirm continuity of the existing resource, plus narrow Sherritt Gordon intercepts of 1.14% over 1.35 m and 0.92% over 2.95 m.
Snow Lake reported more drill results showing intercepts above 1% Li2O in four dykes: 1.84% over 6.32 m at the Sherritt Gordon dyke (labelled GRP-003 in the release), 1.36% over 17.97 m at 429.5 m depth in TBL-035, and 1.50% over 7.00 m at BYP-001. Several holes had no significant values. The company says the deep TBL result may mean the system continues deeper than expected and targets a 25-year mine life, but no updated resource figure is given.
Snow Lake reported first drill results from the Grass River Pegmatite (GRP) dyke, including 3.35% Li2O over 3 metres in hole GRP-003 (within 2.38% over 5.96 metres), and says this could be a new starter pit. It also says the Province of Manitoba extended its exploration permits for another three years. Further analysis is needed to establish the dyke's orientation, and the GRP data will go into the next resource update.
Snow Lake released the first assay results from its winter drilling, covering 3 of the 40 holes submitted. Hole TBL-027 returned 1.49% Li2O over 34.5 metres and TBL-025 returned 1.52% Li2O over 18.0 metres near surface. The company says the Thompson Brothers strike now extends 1.2 km and the dyke appears to go beyond 500 metres depth, and it says the resource will be updated once all results are in. Assay lab backlog is cited as the reason results are slow. Note: the release text gives the TBL-027 width as 34.5 m in the headline but the table lists the width as '300' (apparently a data error), so the 34.5 m figure rests on the From/To of 233.00-267.50.
Snow Lake commissioned a scoping study, with Primero as contractor and working with the Manitoba government and CentrePort, for a lithium hydroxide plant at CentrePort Canada in southern Manitoba. The study starts in April 2022 and is expected to finish by spring 2023; the company expects the mine to reach commercial production in late 2024 (a company expectation, not a commitment). A second release reports a CAD $157,500 Manitoba Mineral Development Fund grant toward the winter drilling campaign, following the earlier $62,000 grant, with three drills running across Thompson Brothers and outside targets (Grass Rivers, BYP, Sherritt Gordon). The text is truncated, so any further details in the second release are not captured.
Snow Lake engaged SLR to prepare an Initial Assessment and a Technical Report Summary under the US S-K 1300 disclosure standard, a step toward a Pre-Feasibility Study and later a Definitive Feasibility Study. The existing June 2021 NI 43-101 technical report was converted to the S-K 1300 format, and the environmental baseline study with SLR is described as running over about two years. The resource figure stays at 11.1 million tonnes at 1% Li2O (indicated and inferred); no new resource number is given.
Snow Lake said it has all permits for its winter drilling campaign and hired Big Ice Services to build about 12 km of ice trails for access, sharing some trail costs with Kinross Gold, and QB Drilling to drill 5,000-15,000 metres of core depending on weather. This is the first use of IPO money on the ground; drilling aims to extend the Thompson Brothers deposit and test other pegmatite targets.
