Angola’s landmark lithium project

Angola

Paulo Nunes, country manager of Angolitio, and Peter Spitalny, executive director of Tyranna Resources, talk to The Energy Year about the potential lithium resources of Namibe province and what makes the project attractive for investors. Tyranna Resources is a mining exploration company, which owns Angolitio as a subsidiary.

How did you identify the potential that the Namibe province has in terms of lithium resources?
Peter SPITALNY: In the last years of the 2010s, the market’s general attention was on the more traditional metal commodities, such as gold, copper and nickel. So, when more focus was put on lithium found in hard rock, such as that found in spodumene-bearing pegmatites, I started doing more consulting work in that area since pegmatites are part of my expertise.
The result of this is that I worked on many lithium projects in many countries and eventually decided to develop my own projects, so I formed a partnership with some Australian businessmen to do this. I reviewed potential worldwide, including Angola.
After some research, we came to the conclusion that the southern part of Angola, specifically near the town of Namibe, had huge potential. It had a known pegmatite field; it had known lithium minerals; and it had almost no work done. Angola, in general, is like that in terms of minerals: pick a mineral or a commodity, and you will find it here. Angola is a sleeping giant.

Paulo NUNES: In 2019, we started working and, after the Covid-19 hiatus, we obtained our first preliminary results and put together our first presentations of maps, sampling, results and potential. This allowed us to increase our investor base and ultimately Tyranna Resources acquired the majority of the shares of the company that we’d set up to launch the project.

What are the key factors that make this an attractive project for investors?
PS: Besides the proven potential of the site, the location of the project is just outstanding. It’s not far from not just one world-class port, but two – the port of Namibe and the Sacomar port. They cover both sides of the Namibe Bay and are already set up for exporting iron ore. The infrastructure is there, including the electricity.
There is a community that can provide work, labour and industrial construction support. There is land to eventually build a plant and stockpile. The location and logistics of this site are as good as you will ever get anywhere in the world. The only way you’d do better is if you had a lithium deposit right next to the port.
So first, we had lithium there. Second, the logistics and economics are outstanding. Third, the project area we have is big, and it’s packed with high-potential pegmatites. Fourth, we can operate in-country, and we are supported by the government. Finally, fifth, we have the necessary experience in this field, and we certainly know what we are talking about.
We will be able to speak about volumes once a feasibility study is finalised. In any case, it is an honour for us to be in a position to be spearheading a unique project for the country: this is Angola’s first lithium project.

What are the upcoming project milestones?
PS: First of all, we have a required set of procedures, and then there’s a timeline. The procedures are sequential, and they have to be because each successive step depends upon what you’ve done before. The timeline is something that’s more indeterminate.
Imagine that you have a project that has the right rocks. According to the testing we’ve done, the quality of the mineralisation is second to none. It’s very high grade. It’s very high purity. It processes well. It’s a lithium geologist’s dream.
In exploration, the first question is, do you have it? You start finding it. Once you’ve found it, the next thing is working out how much you’ve got. Once you’ve done that, you then do a feasibility study. That says, “we have this amount, which on paper is worth ‘X’ number of dollars.” How much is it going to cost to dig this out, to truck it and to crush it? And what’s the market price like now?
Now, if the value of your resource outweighs all those costs of processing it – by a substantial amount – then you mine it. That’s why your feasibility study has to be done. You can’t just give it a go and hope for the best. You need to determine how much you have, do a feasibility study and only then mine.

What are the preliminary results of your ongoing drilling campaigns?
PS: At this stage, we found lithium, and we’re still finding more. We are currently working on a prospect, but there are nine others we have identified, and there’s probably more. Our first drilling programme started in 2022 at the Muvero prospect, and our second one started in October 2023, which continues the investigation of the Muvero prospect.
We’re in the process of determining how much lithium we have. There’s only one way to determine that, and you have to drill. The more you find, the more you drill because you make the potential prospect bigger and bigger. Bigger and bigger is better for your feasibility studies. However, as you’re finding more and you’re drilling more, your timeline stretches out. That’s not a bad thing.
Sometimes you try to accelerate things by bringing in more equipment and more personnel to do twice as much and halve the time. This is something which we are in the process of managing.
However, in terms of how long it will take us to have a resource – which means a quantifiable estimate of how much spodumene we have and how much lithium it contains – we will have these figures by the middle of the year or by the third quarter. From there, we then can start preparing a mineral resource estimate and then use that to do a feasibility study.

What is the strategy for the development of the project once the feasibility study is finalised?
PS: Our next strategic steps will depend largely on the results of the feasibility study. In any case, the standard, typical way of working is that, near the place where you’re mining, you’ll have something that gives you a massive volume reduction.
In other words, you’re going to separate out the valuable component of the material you’ve dug out, so that you’re trucking less material, meaning fewer vehicles, less diesel and less time. In other words, this means you’re going to have to construct a processing plant.
Now, we envisage the processing plant to be located inside the project area, close to where the mine would be. These kinds of facilities typically cover an area of between 10-15 hectares. Then you need stockpiles, and electricity to power the plant.
There are major power lines at the prospect. There’s the electricity from the grid, and there’s also electricity from the solar farm at Caraculo.
Furthermore, for that first stage of crushing, processing and concentrating, you’d have to get some water as well. I think there would probably be a deep water bore in or near the processing plant. What is this processing plant going to look like in terms of investment? In Australian dollars, at least a quarter of a billion, 250 million at least.

What is the strategy to keep securing financing for the project?
PN: We currently have a AUD 31-million [USD 20.3-million] funding deal secured with Sinomine Resource Group. This includes an offtake agreement for 50% of the final output. This arrangement allows us to be flexible and have the remaining 50% of the output to find new buyers.
In terms of financing, our next steps and milestones will require more investments, and this is something we are also working towards when thinking about 2025. More offtake agreements can potentially happen. This is also contingent upon the results of the feasibility study, which will be impacted by international lithium prices as well.

How important is the support of the government in developing projects like these?
PN: The government has open doors for companies such as us, and this is vital. I think the most important thing is that it is possible to do business here, that whatever we design to do in this project, it is possible. There is some government bureaucracy, and that’s understandable and natural. We know the ways to help the ministry and government authorities get things done. It is a manageable process.
It is very exciting to be part of such an emblematic project for Angola. This project will indeed be a significant driver of the economy in the Namibe province in terms of investment and opportunities for local employment.

What do you hope to achieve in 2024?
PS: Our number one priority is to define a mineral resource for the Muvero prospect. When I say “resource,” I mean a quantified amount of a substance that has been estimated using certain minimums and parameters so that it is reliable. That will allow us to start our feasibility study.
In parallel with that, we need to carry on with the development of our other prospects, which we haven’t drilled yet, and that could lead to multiple additional resources inside of the concession.
On top of that, there’s also the expansion of our activities, which means our recruiting of personnel is going to increase. That’s not as easy as it sounds because what we’re doing here is not a traditional thing that’s done in Angola. That means that we need to invest a lot in training.

What is your final message to international mining sector investors?
PS: Angola has a huge potential for any commodity you can think of. It’s a sleeping giant just waiting to be awakened. This country will have a rebirth in the next decade, and you will see multiple projects being talked about and coming to fruition, and people will wish that they had gotten in earlier rather than later.
Everybody likes to buy shares in a company when they are one or two cents and sell them at a dollar, not buy them at a dollar and sell them at 1.05 dollars. This country has great potential. Give it time. We will see it.
If somebody really wants to do well and invest well, now’s the time. Get in early. There are many really good mineral deposits that I know of here that are underexplored, just sitting there, and there are going to be many more that nobody knows about that are going to be found.

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