Sayona Mining Limited announced a feasibility study (FS) that demonstrates the value of its Moblan Lithium Project, forming the centrepiece of the Company's Eeyou Istchee James Bay Hub in northern Québec, Canada. Moblan is owned 60% by Sayona and 40% by Investissement Québec. The Project has an estimated post-tax NPV(8%) of CAD 2,200 million.

The operation is expected to generate estimated total net revenue of CAD 14,400 million over its 21.1 LOM, with an EBITDA of CAD 11,200 million. These positive financial returns have been driven by an estimated head grade of 1.36% Li2O, a LOM recovery rate of 74.7% and LOM average annual concentrate production of 300,000tpa at a grade of 6% Li2O. Moblan is a greenfield project situated in the Eeyou Istchee James Bay territory in north-western Québec, Canada.

It is located within just 300 metres of the Route du Nord, a regional highway which is accessible year-round, providing access to railway lines that link with major ports in Eastern Canada. The Project's key production parameters include a relatively low strip ratio of 2.3:1 (ore versus waste), expected product grade of 6% Li2O, and an estimated operating unit cost outlined in the FS are comparable with some of the most cost competitive international hard-rock lithium mines currently in production, supporting an extremely robust future for Moblan. Upon receipt of the necessary regulatory approvals, delivery of an appropriate financing package based on securing potential offtake and project partners, the Project is expected to require approximately two years to complete construction.

Moblan has an amenable ore body that will deliver product from an integrated process of both dense medium separation (DMS) and floatation circuits supported by ore sorting technology. The offset of delivering such high recoveries is an increase in capital intensity relative to simpler DMS plants. The high expected product recovery will benefit project economics and extend the life of mine.

The challenging market conditions of recent months highlight the importance of developing Tier 1 lithium projects that are strategically located near existing transport corridors and end markets and that have the potential to deliver high grade lithium concentrate at industry-low and competitive operating costs. Moblan is an exceptional project that meets these criteria and look forward to applying Sayona's extensive operational expertise to minimise costs and develop the Project as efficiently as possible. The FS demonstrates a financially and technically viable operation based on estimated NI 43-101 Probable Mineral Reserves of 34.5Mt at 1.36% Li2O to deliver average annual production of 1.8Mtpa.

The financial analysis demonstrates an estimated pre-tax NPV(8%) of CAD 3900 million and a pre-tax IRR of 47.4%, based on a 21.1 year LOM. The estimated post-tax NPV(8%) is CAD 2.2 billion and a post-tax IRR of 34.4%, with a post-tax payback period of 2.3 years based on LOM net cash flows of CAD 6000 million. There are no Proven Mineral Reserves.

Analysis of the financial model on the key economic assumptions indicates that the Project is robust in terms of operating costs and capex. The Project is most sensitive to changes in commodity prices, exchange rates, product grades and recoveries. The Moblan Lithium Project is a greenfield project located 130 km to the north of the township of Chibougamau with access via the Route du Nord.

The Moblan Project comprises 20 claims covering 433 ha or 4.3 km2 and is held by Sayona Nord (60%) and Investissement Québec (40%). The Project is host to lithium mineralised pegmatite. Individual dykes have been documented and modelled comprising the Main Zone, South Zone, Inter Zone and Moleon domain.

The FS assessed several strategic development options and determined an economic open pit mine operation, production schedule and site layout as the preferred option. The FS has been completed with an overall accuracy of ±15% to 20%. The FS has been completed by an independent Canadian consulting firm, InnovExplo Inc., in collaboration with AtkinsRéalis (formerly SNC-Lavalin), Primero Group Americas, SLR Consulting, G Mining Services Inc. and Richelieu Hydrogéologie Inc. Mining is via open pit using a conventional fleet of excavators and trucks.

The final design comprises two pits with the Moleon pit encompassing the Moleon domain, and the Main pit encompassing the Main, Inter and South domains. A detailed dilution model has been developed using linear dilution of 0.50 m and a minimum mining width of 4.00 m. Mining dilution is 5.8% with a mining recovery of 87.6%. The average Fe grade for the LOM is 1.03%.

The Moblan processing facility is designed to produce a 6.0% Li2O spodumene concentrate from an ore grade of 1.36% Li2O (diluted), with an average iron oxide (Fe2O3) content of 1.47%. The spodumene concentrate will be produced via processing through DMS and flotation circuits. The mine plan involves the excavation of 34.5 million tonnes ("Mt") of ore grading at an average of 1.36% Li2O.

The mill is designed to process 1.8 Mt of ore per annum to produce an annual average of 300,000 tonnes of spodumene concentrate at 6% Li2O. Over LOM, the planned open pit will excavate 75.4 Mt of waste rock and 4.1 Mt of overburden. The total calculated stripping ratio is 2.3 tonnes of waste and overburden per tonne of ore.

A metallurgical cut-off grade (COG) of 0.60% Li2O has been used. It should be noted that the iron content can have an impact on metallurgical recoveries and the quality of the spodumene concentrate. Ore shapes containing more than 2.80% Fe have been excluded from the Mineral Reserves Estimate.

The Project is located 130 km from Chibougamau via a year-round accessible road, named 'Route du Nord'. Access to site is easily obtained via a 300-metre access off the main road. Chibougamau is the largest community in the James Bay area.

Chibougamau and Chapais (located approximately 45 km drive west of Chibougamau) are former copper and gold mining centres with a combined municipal population of about 10,000 residents, providing all related municipal infrastructure and services. Aside from provincial roads connecting Chibougamau to all major cities, the railway hub located in Chibougamau offers links with major ports of Eastern Canada, including Montreal and Québec City ports. Chibougamau is also serviced regularly by commercial airlines from Montreal and Québec City.

Access to clean and reliable hydroelectricity is provided via Hydro-Québec. A connection to the existing 161kV electrical line will be made 42 km from the Moblan site.