Andrada Mining (ATM) - Lithium Scaled Expansion funded for 2023

Andrada Mining Ltd., formerly known as AfriTin Mining Ltd., is an AIM-listed mining company focused on the advancement of its Namibia-based assets. The company’s flagship operation, the Uis mine is an open-cast hard rock tin operation which produces and sells tin concentrate and also holds lithium within its mineralisation.  

The company in February 2023 announced an updated mineral resource estimate for the Uis mine. The JORC-compliant mineral resource estimate for the V1/V2 deposit of the operation is based on the company’s 2022 drilling initiatives which consisted of 7,000 m of drilling.  The updated mineral resource estimate for the V1/V2 deposit contains 21 megatons of pegmatite mineralisation at an average grade of 0.72% Li₂O in the measured category, 17 megatons of pegmatite mineralisation at 0.73% Li₂O in the Indicated category and 43 megatons of mineralisation at 0.73% Li₂O in the Inferred category.

Andrada Mining Ltd. plans to operate the Uis mine as a polymetallic operation in the future. The polymetallic operation is not envisioned to involve additional costs and will be able to process all metals present in the operation’s mineralisation. The company plans to conduct a bulk sampling test program at the Uis mine in the coming year as well as the construction of a pilot plant. The obtained samples from the bulk sampling test program will be processed by the envisioned pilot plant from where it will be implemented towards securing a lithium offtake agreement, with the ideal partner having the ability to construct a downstream processing facility at the mine at a later stage. The envisioned pilot plant is scheduled to operate between 6 to 9 months, with the possibility existing for the pilot plant to be incorporated into the processing circuit of the Uis Mine, enabling the company to reach lithium production at an earlier stage.

Name Change

Andrada Mining Ltd., still known as Afritin Mining Ltd. in December 2022, announced that it intended to change its name. The name change was to better reflect the company’s lithium and tantalum resources alongside its existing tin production. The company’s new name is inspired by Jose Bonifacio de Andrada e Silva, the Brazilian mineralogist and professor who first discovered petalite and spodumene which are both major lithium-bearing minerals. Anthony Viljoen, the CEO of Andrada Mining Ltd. explains the company’s new name as a more general name to showcase the polymetallic potential of the company’s Uis Mine.

“We wanted a stronger name. Afritin represented the tin. Andrada is more of a generic name but it does have a bit of meaning in that it's named after a Brazilian mineralogist, who first identified pisolite and spodumene that eventually went on to become lithium. It's a nice, strong kind of rebrand, focusing on the future, focusing on what's also very important to us, which is becoming a sustainable miner of the future. That's also something that we haven't really touched on.”

Market reaction to MRE

Andrada Mining Ltd. in February 2023 announced an updated mineral resource estimate for the Uis Mine. The JORC-compliant mineral resource estimate for the V1/V2 deposit of the operation is based on the company’s 2022 drilling initiatives which consisted of 7,000 m of drilling.  The updated mineral resource estimate for the V1/V2 deposit contains 21 megatons of pegmatite mineralisation at an average grade of 0.72% Li₂O in the measured category, 17 megatons of pegmatite mineralisation at 0.73% Li₂O in the Indicated category and 43 megatons of pegmatite mineralisation at 0.73% Li₂O in the Inferred category.

The published mineral resource estimate however did not garner the market reaction the company aimed for, with no substantial change in its share price seen. Viljoen notes that the response of the market is disappointing, given the size and the significance of the project’s resources.

“It is a bit disappointing because it is significant. It places us as one of the top lithium resources in the world in terms of size. We also upgraded the grade, so what we are finding is that the further down we go in the pit, the better the grade, which obviously helps the economics.”

Upgrades in tin processing

Andrada Mining Ltd. plans to operate the Uis mine as a polymetallic operation in the future. The polymetallic operation is not envisioned to involve additional costs and will be able to process all metals present in the mine’s mineralisation. Viljoen explains that the production of lithium at the Uis Mine will be similar to a byproduct, in the sense that the company will be producing the lithium in conjunction with its regular operations.   

“Essentially what's going to happen is we'll end up producing the lithium for free, because you're going to have a polymetallic plant. You're going to be processing both materials, including tantalum, on a smaller scale. We also announced the rubidium resource, which is quite interesting. That just highlights the real benefit of these pegmatites. They're traditionally included with a number of different elements, and we are finding that with all these different elements, you can get different revenue streams while still having the economies of one plant and one manual operation.”

Viljoen explains the company’s discovery of lithium at the Uis Mine, as a cherry on the proverbial cake. The Uis Mine which is a producing operation as well as profitable only stands to gain with its lithium component, given the global demand for the battery-metal.

“Because lithium is huge. You've got to imagine that this is a bonanza. I don't know what other analogy I can use, maybe the cherry on top of the cake, but this unlocks huge value, especially because the size of what we've got is really significant for the end users in China and in Europe. Everyone needs lithium. There's so much interest in lithium, it is hard to actually convey to people.”

Advancing the lithium component.

The company plans to conduct a bulk sampling test program at the Uis mine in the coming year as well as the construction of a pilot plant. The obtained samples from the bulk sampling test program will be processed by the envisioned pilot plant from where it will be implemented towards securing a lithium offtake agreement. The ideal offtake partner, according to Viljoen, will be able to provide the possibility of constructing a downstream processing facility at the mine at a later stage. He also explains that the envisioned pilot plant will enable the company to unlock the value of the Uis Mine’s mineralisation by enabling the creation of offtake agreements.   

“We want to run test campaigns to get enough material to give to the off-takers so that they can test it for their refining process. That's going to be a key thing. That obviously then unlocks the off-take agreements, which is probably the most valuable thing that you can own.”

The envisioned pilot plant is scheduled to operate between 6 to 9 months, with the possibility existing for the pilot plant to be incorporated into the processing circuit of the Uis Mine, enabling the company to reach lithium production at an earlier stage. Viljoen explains that the initiatives of the company are aimed at reaching a goal production of 45,000 tons of lithium carbonate equivalent (LCE) annually.

“The resource is there. Ultimately, we want to look at the production of 45,000 tons of lithium carbonate equivalent on an annual basis, but we have still got a few steps to complete before we get there.”

The incorporation of the envisioned pilot plant into the processing circuit of the Uis Mine will take approximately 12 months in total according to Viljoen.  

“To integrate the full circuit is probably another 12 months. This bulk test facility is going to be a big operation in its own right, so what we might look to do is to integrate that into the circuit, which will obviously get us into steady-state production on the lithium a lot quicker. We are talking 12 months in the greater scheme of things.”

Viljoen explains that the possibility of constructing a downstream lithium processing facility with the aid of a future offtake partner exists, and will be investigated.

“Initially a concentrate, but that's why, if we can partner up with a technology partner that has off-take as well as the capability of potentially even putting a downstream facility in Namibia,

The company is fully licensed to pursue its lithium production at any scale. The Uis Mine according to Viljoen will not require any new licences to produce lithium, the only regulatory aspect which will need to be amended will be the environmental management plan of the Uis Mine.

“We would obviously have to upgrade our environmental management plan, but we are fully permitted with a full mining licence. We could start extracting it as big as we like tomorrow. The environmental clearance certificate is in place. Water extraction, power, it's all there.”

Future initiatives, Catalysts and Sustainability

Viljoen explains that Andrada Mining Ltd. aims to create various catalysts throughout 2023, with the company’s mineral resource estimate having been planned to be one. He explains the significance of the updated mineral resource is the ability to quantify and provide an economic value to the V1/V2 deposit.

“The initial one is the resource upgrade and getting it into a measured and indicated category because that basically banks the resource as you can then put an economic value onto your financial model.”

Viljoen explains that the next catalyst for the company will be the construction of the envisioned pilot plant at the Uis Mine as well as conducting the bulk sampling program and producing samples which may be used for analysis by potential offtake partners.

“The next catalyst is getting the bulk testing facility up, or the pilot facility, so we can run some campaigns and so that we can get enough material for the off-takers.”

The company plans to continue prioritising and following its ESG values in the coming year. Andrada Mining Ltd. on the 26^th of January 2023 published its inaugural sustainability report. The report details the company’s sustainability performance for the 2022 financial year and lays out the company’s plans regarding the sustainability of its ESG values at its assets as well as the reporting thereof. Andrada Mining Ltd. will in the coming year continue to integrate its ESG departments into the operation of its Uis Mine. Viljoen explains that the company aims through the continued publishing of its sustainability report to show not only its commitment to its ESG values but also showcase the implementation thereof.

“Everyone talks about ESG, and no one actually does anything about it. Another first for us, compared to a lot of our peers, is that we released a sustainability report and that basically is a blueprint for how we are going to be not only a miner providing critical metals for the energy transition, but we're going to do it in a sustainable way”

To find out more, go to the Andrada Mining website