Atlantic Lithium Limited (AIM:ALL, OTCQX:ALLIF, ASX:A11) was handed a ‘buy’ rating by investment bank Liberum following last month’s results from its pre-feasibility study (PFS) on its Ewoyaa spodumene project in Ghana.
Liberum dished out a 46.0p target price for the lithium-focussed explorer and developer, representing an almost 25% premium to its Thursday afternoon value of 37.0p. Its shares were up 4.5% on the day.
The lithium price the company used in its PFS was well below the spot (current) price at the time.
The mining inventory included a maiden probable ore reserve of 18.9mln tonnes (Mt) at 1.24% Li2O, with an impressively high indicated resource-to-reserve conversion ratio of roughly 92%, the broker added.
PFS assumed the mining of 25Mt of ore over a 12.5-year life-of-mine (LOM).
Given drilling results to date, Liberum believes there to be good potential for the 31Mt of reserves that it assumed in its model.