Is Global Lithium Poised to Become Major New Lithium Supplier from Australia

• Ron Mitchell has over 13 years of experience in the lithium industry, previously working for major producers like Talison and Tianqi.
• He joined Global Lithium as MD in 2022, attracted by its two promising lithium projects in Western Australia.
• In Feb 2023, Global Lithium released a scoping study for its Manna lithium project, showing strong economics with a pre-tax NPV of A$2.8 billion.
• The company is now moving directly into a feasibility study to be completed by the end of 2023, with the aim of starting production in 2026.
• Global Lithium also has a second lithium project at Marble Bar where a major exploration campaign in 2022 led to a resource upgrade to 18Mt Lithium.

Global Lithium is an emerging lithium developer aiming to become a major new producer of lithium concentrate from two projects in the mining-friendly jurisdiction of Western Australia. With strong economics demonstrated in a recent scoping study, an experienced management team, and over A$75 million in cash, the company is now rapidly advancing its flagship Manna lithium project towards production targeted for 2026.

The company was founded in 2018 and listed publicly in 2021, raising A$29 million at A$1.30 per share in an oversubscribed IPO. This was followed in March 2022 by an A$121 million placement at A$2.25 to strategic investor Mineral Resources, one of Australia’s largest mining services and processing groups. Mineral Resources has continued to increase its stake in Global Lithium and now holds 9.7% of the company.

Global Lithium is led by lithium industry veteran Ron Mitchell, who joined as Managing Director in June 2022. Mitchell has over 13-years of experience in the lithium sector, including senior roles with major producers Talison Lithium and Tianqi Lithium. This gives him an extensive network across the global lithium supply chain as well as expertise in lithium mining and processing.

Flagship Manna Lithium Project Shows Robust Economics

The company’s flagship project is Manna, located in Western Australia’s Goldfields region approximately 600km northeast of Kalgoorlie. Exploration work over the past two years has outlined a large lithium resource at Manono, which now stands at 32.7 million tonnes at 1.0% Li2O.

In February 2023, Global Lithium announced the results of a scoping study completed by independent consultants Entech and Wave International. This demonstrated robust economics for a proposed 2Mtpa mining and processing operation at Manna producing around 220,000 tpa of lithium concentrate grading 5.5% Li2O.

The scoping study estimated pre-tax NPV of A$2.8 billion using an 8% discount rate and pre-tax IRR of 103%, based on a lithium price of US$2,500/t Li2O real. Capex is estimated at A$419 million with a payback period of just 15 months from first production. Average life-of-mine operating costs are a competitive US$688/t concentrate. The company is now moving directly into a full feasibility study on Manna, awarding study contracts in March 2023. The aim is to complete the DFS by the end of 2023, with a view to making a Final Investment Decision in 2024 and starting construction soon after. The first production of lithium concentrate is targeted for 2026.

Global Lithium has also commenced metallurgical test work and will look at opportunities to add further value through the production of downstream lithium chemicals. Located close to an established mining infrastructure with access to gas, power, and transport networks, the project is ideally positioned to feed the rising lithium demand from the battery industry.

Large Exploration Target at Second Project

In addition to Manna, Global Lithium owns the Marble Bar lithium project located in the Pilbara region of WA. Marble Bar already hosts a substantial lithium resource of 18Mt at 1.0% Li2O, defined through drilling in 2022. Exploration results have also outlined a large new target northeast of the existing resource, with the potential to significantly expand the resource base.

The company has an A$15 million exploration budget for Marble Bar in 2023 comprising 30,000m of RC and diamond drilling. This offers substantial upside potential through new discoveries, given that only a small portion of the large prospective area has been explored to date.

Strong Leadership and Supportive Major Shareholders

An important aspect of Global Lithium is the experience and expertise embodied in its board and management. Ron Mitchell as MD brings over 13 years in the lithium industry including developing downstream processing facilities. The board includes four other highly experienced mining executives with proven track records.

The company also has the backing of major shareholders Mineral Resources (9.7%) and Yahua (4.7%), the latter a subsidiary of major Chinese lithium producer Ganfeng Lithium. These provide strong endorsement along with strategic partnership opportunities.

With its robust project economics, experienced team, supportive major shareholders and exploration upside, Global Lithium has positioned itself to take advantage of the lithium market growth driven by electric vehicle and battery demand. The company offers investors exposure to a potential new lithium producer from a top-tier mining jurisdiction that can help meet the lithium supply challenges over the coming decade. Global Lithium remains undervalued compared to lithium developer peers and offers significant re-rating potential as it de-risks Manna towards production.

The Investment Thesis for Global Lithium

• Flagship Manna lithium project demonstrated robust economics in scoping study, positioned to move into production by 2026
• Additional exploration upside from the second lithium project at Marble Bar
• Highly experienced board and management led by lithium industry veteran Ron Mitchell
• Backed by major shareholders Mineral Resources (9.7%) and Ganfeng subsidiary Yahua (4.7%)
• Trading at a discount to lithium developer peers despite advanced stage and quality assets
• On track to become a major new supplier of lithium concentrate feeding battery growth