Key Highlights

  • Final assays for hole NMRD108 returned 74 metres at 1.32 per cent Li2O from 209 metres downhole.
  • A separate 76.7 metre intercept graded 0.77 per cent Li2O in another hole.
  • Blackbeard lies less than 20 kilometres from the Finniss lithium plant in the Northern Territory.
  • Drilling at Blackbeard is continuing, and the company is assessing resource growth and a longer mine life.

Core Lithium (ASX:CXO) has reported final assay results from hole NMRD108 at the Blackbeard prospect, part of its Finniss lithium operation in the Northern Territory. The results, released on 6 November, include an intercept of 74 metres grading 1.32% lithium oxide (Li2O) from 209 metres downhole.

According to the company, this is the second-longest mineralised intercept recorded at Blackbeard so far. Core also reported a separate intercept of 76.7 metres grading 0.77% Li2O from another hole. The term "final assays" indicates that the full set of laboratory results for NMRD108 has now been received.

Reading the numbers

The intervals are downhole lengths.

The two intercepts show a trade-off that is common in lithium pegmatites. The NMRD108 interval combines considerable length with a grade above 1% Li2O, while the 76.7-metre intercept is slightly longer but less than two-thirds of that grade. Grade affects how much spodumene concentrate can be produced from each tonne of ore, and so has a direct effect on project economics.

The NMRD108 intercept starts at 209 metres downhole. Mineralisation at this depth may need to be considered for underground mining, or for deeper open pits, depending on how the orebody is shaped and on the results of Mining studies. The vertical depth of the intercept will depend on the hole's angle, which was not given.

Why Blackbeard matters

The main point Core has made about Blackbeard is its location. The prospect is less than 20 kilometres from the Finniss processing plant. Ore found close to existing infrastructure can, in principle, be trucked to the plant without the cost of building new processing facilities, which can improve the Economics of smaller or medium-sized deposits. Haulage costs, road access and ore blending would still need to be assessed in any study.

The company said it is evaluating whether Blackbeard could increase the Finniss resource and extend the mine life of the operation. For an operation centred on a single processing plant, the amount of nearby feed available is a key Factor in how long and at what scale the plant can run.

Limitations

These are exploration and resource-definition drilling results, not a mineral resource estimate. Drill intercepts show mineralisation in individual holes; continuity between holes, metallurgical performance and mining costs all need to be established before the material can be considered for a mine plan. Individual pegmatite results can vary quite widely between holes.

The economics of any future development will also depend on lithium prices, which have been volatile, and on decisions about how and when Finniss operates.

Next steps

Core said drilling at Blackbeard is continuing. Further assay results would be expected as holes are completed and analysed, and the company is assessing the potential for resource growth and a longer mine life at Finniss. Any update to the resource would be reported in line with the JORC Code, separating inferred, indicated and measured categories. Investors following the project will be looking for results that show how far the mineralisation continues along strike and at depth, and for a timetable for including Blackbeard in a formal estimate.