Shares in Argosy Minerals Ltd (ASX: AGY) returned to their 12-month high on Monday after the company announced significant progress on supplying power to its Argentinian lithium project.
Argosy said in a statement to the ASX on Monday that the Salta Electricity Distribution Company (EDESA) had completed the detailed engineering and feasibility works on a medium voltage line to the company's Rincon lithium project, with the line capable of supplying 40 megawatts of energy.
The company went on to say:
The next phase of works for the medium voltage line project comprises a competitive tender process to bid for the electric transmission line and associated transformer station construction works from reputable contractors. Provisional cost estimates and delivery schedules completed by EDESA will be further defined as part of this process. In parallel, the company is engaging with local renewable energy providers to establish Power Purchase Agreements (PPA's) to ensure sustainable and cost-efficient energy supply to the Rincon project via the national power grid. Access to reliable, grid-based power is expected to reduce operational costs, strengthen project economics and minimise the need for costly on-site diesel power generation.
Argosy said securing access to national grid power was a critical milestone for the project and significantly derisked it, while also improving the project's economic viability.
Feasibility works ongoing
Argosy Managing Director Jerko Zuvela said:
Completing the detailed engineering works for the medium voltage Line project and securing strategic access to national grid power marks a significant milestone for the development of our 12,000tpa Rincon lithium project and positive progress toward finalising the feasibility works. Completing the medium voltage line project will provide a major cost-saving advantage, given access to energy is the key barrier to entry for many lithium projects, where such infrastructure and access to grid power is lacking in the NW region of Argentina. Being only about 8km from such critical energy infrastructure beneficially positions Argosy for sustained growth and success to ultimately develop and successfully commercialise our Rincon lithium project.
Argosy owns a 77.5% interest in the Rincon project and can earn up to 90%.
The company recently said in a statement to the ASX that the process design phase works for the project had been completed, and test work would be done to determine the optimal process for processing lithium at the project.
Argosy Minerals shares hit 13.5 cents on Monday morning, returning to their 12-month highs before settling back to be 4% higher at 13 cents.
Argosy was valued at $192.9 million at the close of trade on Friday.
