Site visit notes
BUY – 18.5p
- The Company hosted a site visit to the Barroso Lithium Project in Northern Portugal last week. Key takeaways below.
- DFS on track for July 2026; no material design changes anticipated from the 2023 Scoping Study (1.5Mtpa, DMS/flotation flowsheet, ~190ktpa SC5.5).
- RECAPE submission reiterated for 4Q26, triggering a 50-business day hard-deadline review; environmental licence completion expected 1Q27. Notably, no project that has cleared the DIA stage has to date failed at RECAPE.
- Environmental workstream progressing; baseline studies (air quality, noise, vibration) ongoing alongside targeted work addressing points raised during the DIA process.
- Mine design configured to minimise community and environmental impact: no water drawn from local rivers, no housing relocation, dynamic pit backfilling, dry-stacked TSF, and haulage roads routed away from local villages.
- Community engagement materially strengthened over the past two years –growing local hiring and improving communication over direct and indirect economic benefits from environmentally responsible mining operation;
- Local stakeholder profile raised with Portuguese nationals represented across management and the Board; local investors holding just over 25% of the register.
- Land acquisition process of privately owned land (~25% of project area) is ongoing while discussions with the Covas do Barroso Baldios remain challenging; voluntary acquisition is the target, though current regulation permits compulsory consolidation, a mechanism with local precedent in infrastructure projects such as roads and wind/hydro power.
- Strong central government support underwritten by the up to €110M Portuguese State grant and Strategic Project Status under the EC CRMA.
- MRE expansion and scale optionality are not in the base case with step-out drilling expected post-commissioning.
Conclusion: The site visit reinforces our conviction in the project with DFS (July) and RECAPE (1Q27) timelines intact, environmental workstreams progressing, and community engagement materially improved. Fundamentals remain unchanged: EU’s largest spodumene resource (with MRE expansion upside), conventional flowsheet, good infrastructure, up to €110m state grant (strong central government support signal), AMG strategic partnership and supportive local investor base. Strategic location (EU’s 2nd largest EV market) and the absence of competing regional spodumene deposits position Barroso as a prime source for future European lithium refinery capacity and a credible M&A target. Clear catalysts ahead: DFS to tighten design and economics to be used to advance project funding discussions; RECAPE approval the long-awaited major re-rating event.
*SP Angel act as Nomad and Broker to KEFI Gold and Copper
