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Savannah Resources PLC: DEEP DIVE

Savannah Resources steams ahead with flagship Mina do Barroso project

The firm’s portfolio encompasses both assets with near-term production potential and longer-term development opportunities
Mina do Barroso
OVERVIEW: SAV The Big Picture
In May, the company said it expected to be able to “significantly” increase the existing resource at Mina do Barroso


• Multi-commodity mine developer

• Flagship lithium project in Portugal

• Has other assets in Oman (copper), Mozambique (mineral sands) and Finland (lithium)

  • House broker has 23p price target 


What it owns

The group’s asset portfolio encompasses:

• The Mina do Barroso lithium project in Portugal

• Block 4 and 5 Copper projects in Oman

• The Mutamba Mineral Sands project in Mozambique

• Somero and Eräjärvi lithium projects in Finland


How is it doing

Speaking to Proactive in mid-May, Savannah’s chief executive David Archer said the firm was making “very good progress” with a feasibility study for its flagship Mina do Barroso project.

Savannah also has “second mover advantage” as it sought to apply lessons learned from the first wave of Australian lithium developments to its Portuguese project.

The project is attracting interest from potential industry partners and off-takers as well as an opportunity to develop a lithium conversion plant in Portugal which would allow the company to “lock down from end-to-end the whole lithium value chain in Europe”.

Archer has also hailed the establishment of a European cross-border battery cell consortium, which was set up by Germany and France.

"The Franco-German decision to establish this initiative, as well as the EU's plans to launch a European raw materials investment facility, highlights the seriousness of the EU to strongly commit to increasing its investment in the European lithium battery industry”, he said.

"Mina do Barroso’s relevance and location mean that it has the potential to be an extremely important strategic asset, playing a leading role in ensuring that Europe meets a significant portion of its demand for lithium internally.”


Broker ups price target

In June, house finnCap slightly increased its target price to 23p from 22p, reflecting the lithium explorer’s recent resource update.

On 31 May, the AIM-listed firm said the estimated mineral resources at its Mina do Barroso lithium project in Portugal have been increased by around 15% to 27mln tonnes at 1.06% Li₂O for 285,900 tonnes of contained Li₂O.

“Savannah Resources offers exposure to a diversified portfolio of mining assets including lithium in Portugal, heavy mineral sands in Mozambique and copper in Oman.

“The Mina do Barroso lithium project in Portugal is the most advanced of the three projects, with a Definitive Feasibility Study expected to be completed in H2 2019.”

 “This now hosts Europe’s largest spodumene deposit and is expected to form an integral part of the current EU initiative to build a Strategic Battery Value Chain in Europe.”


What the boss says: David Archer, CEO

“"It is evident that Mina do Barroso could support the development of a mineral conversion plant with the required tonnages of the lithium raw material inputs of spodumene concentrates to act as a base load for a major lithium hydroxide production plant and a new industry for Portugal.”





Inflexion points

  • Definitive feasibility study for Mina Do Barroso
  • European in initiative to develop electric battery capacity in Europe should aid Savannah
  • Price target of 23p from finncap compared to 5.1p in market
  • By the year 2025, European lithium-ion batteries are expected to represent a market worth €250bn annually


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Savannah Resources PLC Timeline

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