(Kitco News) - Compass Minerals (NYSE:CMP) announced today that it selected EnergySource Minerals (ESM) as its direct lithium extraction (DLE) technology provider for its previously identified, approximately 2.4 mMT lithium carbonate equivalent (LCE) resource on the Great Salt Lake.
Compass is targeted phase-one production of approximately 11 kMT LCE annually. The estimated phase-one development capital is $262M (-30% to +40%).
The company expects phase one to yield approximately $626 million to $985 million in after-tax NPV and an after-tax IRR between 28% and 36%.
Yesterday Compass announced that Koch Minerals & Trading will make e a $252 million strategic equity investment in the company through common stock.
In July Compass Minerals announced the signing of a non-binding memorandum of understanding "...to explore supplying Ford Motor Company (Ford) with a battery-grade lithium product from its lithium brine development project at its Ogden, Utah, solar evaporation facility."
Compass CEO Kevin S. Crutchfield called today a milestone.
"Over the course of the past several months, we have continued to make great strides on several strategic fronts driving our lithium development project forward," said Crutchfield. "After significant efforts assembling internal lithium expertise and successfully testing the conversion potential of our resource, we are very pleased to today announce the achievement of additional key milestones including the selection of our DLE technology provider, disclosure of our initial project economics and the completion of a third-party assessment of our project's sustainability profile. We are confident that the continued forward momentum achieved through these milestones further demonstrates the value creation potential, differentiated positioning and formidable environmental profile of our planned lithium development, all of which we believe will prove to be competitive advantages for Compass Minerals."
Compass Minerals said it will be leveraging existing operational infrastructure, permits, water rights and pond processes to extract lithium as a co-product of its long-standing sulfate of potash, salt and magnesium chloride production at the company's Ogden facility, thereby reducing the incremental environmental footprint of the project.
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