Pursuit Minerals has delivered a compelling Pre-Feasibility Study for its Rio Grande Sur lithium project in Argentina, confirming strong economics and a maiden Ore Reserve. The company also secured a A$7 million capital raise to advance development.
- Pre-Feasibility Study confirms 5,000 tpa lithium carbonate production
- Maiden Probable Ore Reserve of ~125 kt LCE declared
- Strong project economics – NPV US$364m, IRR 22.4%, 7-year payback
- Capital expenditure estimated at US$136.5m; operating costs US$6,521/t LCE
- Oversubscribed A$7m placement secured for ongoing drilling and development
A Lithium Project with Scale and Substance
Pursuit Minerals Limited (ASX, PUR) has announced the results of its Pre-Feasibility Study (PFS) for the Rio Grande Sur Project, a lithium brine development located in Argentina’s Salta Province. The study confirms the project as a technically sound and economically viable operation, targeting an initial production of 5,000 tonnes per annum (tpa) of lithium carbonate equivalent (LCE) over a 25-year mine life.
Central to the announcement is the declaration of a maiden Probable Ore Reserve of approximately 125,000 tonnes LCE, supported by an updated JORC (2012) Mineral Resource Estimate of 1.264 million tonnes LCE. This resource upgrade reflects enhanced geological modelling and new drilling data, underscoring the project's substantial scale within the globally significant Lithium Triangle.
Robust Economics Under Conservative Assumptions
The PFS outlines strong financial metrics, with a net present value (NPV) of US$364 million and an internal rate of return (IRR) of 22.4%, based on conservative lithium price assumptions that start at US$15,714 per tonne and rise to US$27,500 per tonne in the long term. The payback period is projected at seven years, supported by a capital expenditure (CAPEX) estimate of US$136.5 million and operating costs (OPEX) around US$6,521 per tonne of LCE, positioning Rio Grande Sur in the lowest quartile of the global lithium cost curve.
These economics are underpinned by a well-defined production plan that includes a six-well production wellfield, solar evaporation ponds, and a lithium carbonate processing plant designed for operational simplicity and scalability. The project’s location benefits from established infrastructure and proximity to major lithium operations, enhancing its development prospects.
Funding Secured to Advance Development and Exploration
In tandem with the PFS release, Pursuit Minerals announced an oversubscribed capital raising of A$7 million through a two-tranche placement to sophisticated and institutional investors, including the Lowell Natural Resources Fund. The funds will support ongoing drilling programs aimed at resource expansion, particularly at the Mito tenement, and advance feasibility studies for both the Rio Grande Sur lithium project and the Sascha Marcelina gold project.
Managing Director Aaron Revelle emphasised the project’s resilience and long-term potential, highlighting the company’s strategic positioning with exposure to two commodities, lithium and gold, that are expected to benefit from robust medium- and long-term fundamentals.
Next Steps and Market Context
Looking ahead, Pursuit plans to progress resource expansion drilling, initiate long-duration pumping tests to refine hydrogeological parameters, and conduct pilot-scale solar evaporation trials. These activities aim to de-risk the project further and pave the way for a Definitive Feasibility Study and ultimately a Bankable Feasibility Study.
While the PFS results are promising, the company cautions that long-term lithium price forecasts are inherently uncertain and that project execution will depend on securing environmental approvals, financing, and managing operational risks typical of mining developments.
Bottom Line?
Pursuit Minerals’ Rio Grande Sur project emerges as a promising lithium development, but market dynamics and execution risks remain key watchpoints.
Questions in the middle?
- How will lithium price volatility impact Rio Grande Sur’s financing and development timeline?
- What are the key milestones and timelines for environmental approvals and definitive feasibility studies?
- How might resource expansion drilling at the Mito tenement alter the project’s scale and economics?