First Phosphate Corp. (CSE:PHOS) revealed that it has engaged P&E Mining Consultants Inc to complete a Preliminary Economic Assessment (PEA) on its flagship Lac à l'Orignal Phosphate project, in the Saguenay-Lac-Saint-Jean region of Quebec.
The company said it has got P&E to lead the PEA, which will utilize the latest Mineral Resource estimate completed by P&E in November 2022.
The Lac à l'Orignal Mineral Resource estimate is based on 63 drill holes and 17 surface channel samples totaling 7,984 meters (m) and 149.5m respectively. The database for the study contained 2,880 assays. The Mineral Resource estimate can be viewed in table format here.
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The company’s Lac à l'Orignal phosphate project contains a high-quality phosphate resource potentially suitable for lithium iron phosphate (LFP) batteries. The management has board approval to advance the project toward its first economic study.
"Undertaking this PEA is an important step in our development of the Lac à l'Orignal property as we move forward along our path to develop cathode active material for LFP batteries for electric vehicles," First Phosphate President Peter Kent said in a statement.
The PEA will include details on project economics encompassing the separation of three marketable concentrates — a phosphate (apatite) concentrate, a titanium oxide (ilmenite) concentrate, and an iron oxide (magnetite) concentrate.
The objective of the PEA is to create a mine plan, mine production schedule, capital cost estimate, and an operating cost estimate incorporated into a financial model to provide total cash flow, after-tax net present value (NPV), and after-tax internal rate of return (IRR), said the company.
The project concept is to outline a development opportunity around a stand-alone open pit mine and concentrator facility for all three concentrates located in the Saguenay-Lac-Saint-Jean region of Quebec. The region already has industrial activity, including four aluminum smelters, an alumina refinery, forest products operations, and hydroelectric power generating stations.
The project design will tie into existing infrastructure including the low-to-no-carbon-emissions Quebec Hydro grid, and to existing municipal and heavy-haul road networks which provide access from the Lac à l'Orignal project directly to the deep sea port of Saguenay.
The company said it has in place a memorandum of understanding with Port Saguenay to ship its phosphate concentrate internationally, as well as access to greenfield land on which to eventually build advanced processing facilities.
First Phosphate noted that the completion of the PEA is scheduled for the third quarter of 2023.
Purchase of mineral claims
Separately, First Phosphate said it has struck a purchase agreement with an arm's length party to acquire 13 additional mineral claims within the Bégin-Lamarche claim block, representing 612 hectares in the Saguenay-Lac-Saint-Jean area for $25,000, to be paid through 27,173 shares at $0.92 per share.
The shares will be subject to a four-month and one-day hold period from the closing of the acquisition. The company now holds 2,778 royalty-free claims covering an area of 1,531 square kilometers.
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