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Savannah Resources boosts Mina do Barroso lithium resource by 17%

Savannah continues to expect further growth from what's already one of Europe's most significant lithium deposits
Savannah Resources boosts Mina do Barroso lithium resource by 17%
Lithium is in high demand for use in the next generation of batteries

Savannah Resources PLC (LON:SAV) found gains on Tuesday as the group boosted resources at the Mino do Barroso lithium project in Portugal by 17% to 23.5mln tonnes (Mt).

Within that, the measured and indicated resource now totals 13.3mln tonnes grading 1% lithium oxide.

WATCH: Savannah Resources to broaden mine planning for Mina do Barroso after new high-grade discovery

The updated resource cements the project's place as Western Europe's most significant spodumene lithium resource.

The overall amount of lithium oxide contained in Mina do Barroso amounts to 241,000 tonnes.

What’s more, the company believes significant upside remains, and that the total resource could eventually go to over 30mln tonnes.

"This is the fourth major increase in the Mina do Barroso mineral resource and it has been achieved in less than 14 months,” said chief executive David Archer. 

“The increasing mineral resource highlights the continued growth potential for the project which is underscored by the exploration target remaining unchanged. With a potential mining inventory of over 30mln tonnes, we have a long-life asset that can become a secure, long term supply source of lithium, which is a strategic metal for the burgeoning battery and electric vehicle industries of Europe."

In a note to clients, analysts at ‘house’ broker finnCap commented: “Some 58% of the resource is now contained within the Measured and Indicated categories.”

They added: “Most of the resource is contained within the Grandao deposit, where 17.7Mt at 1.04% Li₂O containing 181,800t of Li₂O has now been identified.”

finnCap reiterated a 20p price target on Savannah Resources’ shares which in late morning trading were 2.7% higher at 5.65p.

 -- Adds analyst comment, share price --

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