Mineral resource company Piedmont Lithium has released the results of a scoping study for its vertically-integrated Piedmont lithium project located in North Carolina, US.

Located within the Carolina Tin-Spodumene Belt (TSB), the scoping study includes a 22,700t per annum lithium hydroxide chemical plant, which will be supported by an open pit mine and concentrator producing 170,000t a year of 6% lithium oxide low-iron spodumene concentrate.

The study has delivered compelling projected economics for the project due to low initial capital, early spodumene concentrate sales, attractive capital and operating costs, short transportation distances, minimal royalties and low corporate income taxes.

“We look forward to an exciting period ahead as we work to enhance the project even further.”

Piedmont noted that the project will meet an important strategic need for domestic US lithium production.

Piedmont Lithium president and CEO Keith Phillips said: “The economic benefit of developing an integrated lithium chemical business in North Carolina, US, is now clear, driven by the exceptional infrastructure and human resource advantages of our location, as well as the competitive royalty and tax regime offered in the US.

“We look forward to an exciting period ahead as we work to enhance the project even further through continued growth in our resource base and project life, and the evaluation of potential by-product credits.”

The project is expected to deliver after-tax margins of around $8,900 per tonne and US$8,650 per tonne of free cash flow during life-of-mine operations once the construction of the chemical plant is completed.

It has an estimated after-tax internal rate of revenue (IRR) of 56% and net present value (NPV) of $777m.

Last month, Piedmont reported a maiden mineral resource estimate for the lithium project, comprising 16.2Mt grading at 1.12% lithium oxide.

The company is now set to move forward with a pre-feasibility study, which is expected to be completed next year.