Green Technology Metals’ updated PEA strengthens Root economics

Green Technology Metals has optimised a study for Root lithium project to show a robust, standalone development despite market volatility.

The company plans to produce long-term feedstock from the project for its proposed lithium conversion facility in Thunder Bay, Canada. Pic: Getty Images.

Special Report: Green Technology Metals has released an optimised Preliminary Economic Assessment (PEA) for its Root lithium project in Canada highlighting stronger economics despite recent market dynamics.

• GT1’s updated PEA shows favourable economics for Root as standalone lithium development
• NPV up 22% to US$668m, EBITDA of US$234m, after tax IRR of 53.5%
• Permitting being advanced in parallel with PFS

Given fluctuating price predictions and volatile market analysis, the company looked at several different forecasts to assess an average price over the production period – settling on an average annual spodumene concentrate price of US $1,977 FOB Thunder Bay for a 5.5% Li2O spodumene concentrate (SC5.5) product.

In addition, Green Technology Metals (ASX:GT1) evaluated Root as a standalone project for this PEA as opposed to the December 2023 PEA which combined the Root project with the Seymour project and considered the recently updated resource of 20.1Mt at 1.24% Li2O.

The study updated pit optimisations for the Root, Root Bay and McCombe deposits to US$400-2000, below the US$2500 pit shells in the 2023 PEA. 

Open pit and underground development options were considered for Root Bay and McCombe to reduce waste movements and mining costs, whilst preserving opportunities for future growth.

The company also increased mining and processing inventories adding eight months to the operational life of the project 

The result is robust economics across alternative development scenarios, resulting in:

• An increase in the NPV by 22% to US$668m 
• EBITDA of US$234m 
• After tax IRR of 53.5%
• 213,000dtpa of SC5.5 spodumene production
• LOM average C1 cost of US$677t; and
• Payback period of 3 years.

PFS next on agenda

GT1 said the updated PEA reinforced Root as a viable and resilient standalone project expected to provide long-term feed to the planned lithium conversion facility in Thunder Bay.

“With a longer mine life, reduced upfront capital requirements and strong economics, Root is well-positioned to support GT1’s broader strategy of establishing a vertically integrated lithium supply chain in Ontario,” GT1 managing director Cameron Henry said. 

“This study reinforces our confidence in Root as a long-term feed source for the Thunder Bay conversion facility and highlights the project’s strategic importance in the North American battery materials landscape.

“The economic advantages of executing a project in Ontario are obvious and compelling, driven by outstanding infrastructure, government incentives and proximity to the North American EV supply chain.” 

In addition to its robust fundamentals, the company says the project offers upside potential through future optimisation and resource growth. 

The next steps will be advancing permitting in parallel with a pre-feasibility study. A definitive feasibility study is slated to follow in 2026.

This article was developed in collaboration with Green Technology Metals, a Stockhead advertiser at the time of publishing. 

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.