11:16 AM EDT, 08/22/2024 (MT Newswires) -- Patriot Battery Metals ( PMETF ) late Wednesday released the results of a preliminary economic assessment (PEA) for its Shaakichiuwaanaan lithium project in northern Quebec showing the site can support a mining project costing $761 million for its initial phase.

It cited potential pre-tax net present value 8% of $4.7 billion (US$3.6 billion) and after-tax NPV 8% of $2.9 billion (US$2.2 billion) with a pre-tax internal rate of return of 38% (after-tax IRR of 34%) at US$1,375 per tonne.

When a second stage is complete, the company said production will reach nearly 800,000 tonnes per year of spodumene concentrate, which it said will potentially position Patriot as the fourth largest producer globally.

"Although studies are still at an early stage the potential outcomes of the PEA for the Shaakichiuwaanaan project highlights the opportunity for Patriot Battery Metals ( PMETF ) to become a global lithium leader and a key supplier of lithium raw materials to the emerging North American and European battery materials supply chain," chief executive Ken Brinsden said in release.

He added: "The PEA outlines a staged development pathway for Shaakichiuwaanaan, commencing with an initial 400 ktpa production capacity which is intended to allow us to leverage the key competitive advantages of this world-class deposit to provide lithium raw materials in emerging western markets.

"Importantly, the resources to be mined include a high-grade component in the Nova Zone that creates an opportunity for a potentially resilient project, while also giving us considerable flexibility in terms of how we progress Shaakichiuwaanaan. This flexibility and scalability could allow us to adapt nimbly to evolving market conditions, while continuing to grow the resource base.

"As we consider moving to the Feasibility Study stage, the Project's anticipated low operating costs and expected IRA-compliant high-quality lithium product could make us an ideal partner for downstream players, making this a highly strategic asset in the future lithium landscape. There is also strong inbound interest from strategic partners to support Stage 1 funding, alongside potential access to Government funding mechanisms.

"The Shaakichiuwaanaan Project is potentially well positioned to anchor the North American lithium supply chain, meeting demand for decades to come, in the process targeting significant returns for all our stakeholders while maintaining a strong emphasis on sustainability and limited environmental impact."

National Bank of Canada maintained its outperform rating and $10.00 price target on Patriot following the release of the study..

The bank said results of the study should allow for the advancement of conversations with potential future strategic partners for the project, while providing additional visibility to what financing could look like.

Patriot shares were last seen up $0.015 to $4.675 on the Toronto Stock Exchange.

Price: 4.68, Change: +0.01, Percent Change: +0.32