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  • John Wisbey

Mining Terms

The following, which is by no means comprehensive, is designed to guide readers on some of the terms used in the mining industry and specifically in ILC’s part of it. They may avoid confusion :

What does MT mean ?

In the scientific world for at least the last 50 years, the term M has usually stood for million. For example MB = Megabyte, Megapixel means million pixels. Megatonne for a nuclear weapon is a million tonnes equivalent of TNT and is written MT. Similarly m stands for one thousandth, e.g. millimetre is one thousandth of a metre and so on. Not so in the mining industry. One metric tonne is a thousand kilograms but carries the symbol MT or sometimes mT. So if we announce a resource of, say, 5,000,000 MT at 1% of lithium oxide, we in fact mean that we have 5,000,000 metric tonnes with 50,000 tonnes of lithium oxide inside.

Why do we not do the maths ?

Quite simply there are regulatory constraints. If, purely by way of example, we say that we have 5,000,000 metric tonnes of spodumene with 1% lithium oxide content, i.e. 50,000 MT and if the lithium oxide price is USD65,000 per MT, then we could clearly go on to say that we have USD 3,250,000,000 of lithium oxide. This is however highly discouraged by IIROC and other regulators, possibly because it might create expectations about the value of the lithium deposit or the company so, when we don’t do it, please understand why not. It is not like having a kilogram of gold in a bank vault, as there is a high capital and operating cost of refining and processing. Of course when we get to the PEA stage or the Feasibility Study stage then we can show NPV calculations, which also take the cost of extraction into account.

Updip and Downdip

Underground formations usually are not parallel to the surface of the ground. The term "dip" denotes the incline or slope of the formation. Updip means located up the slope, and downdip means located down the slope.

Sometimes we or any other company deliberately don’t drill vertically but drill at an angle to the true depth of a deposit. This helps to show how far the deposit goes on for horizontally, but needs to be adjusted (by multiplying by the sine of the angle) to avoid exaggerating the depth of the deposit.

What is a Gabbro

Gabbro is a coarse-grained, mafic intrusive igneous rock formed from the slow cooling of magnesium-rich and iron-rich magma into a mass deep beneath the Earth's surface. Slow-cooling, coarse-grained gabbro is chemically equivalent to rapid-cooling, fine-grained basalt.

What is Mafic

The adjective mafic refers to a group of dark coloured rocks (magmatic, either intrusive or extrusive) having a chemical composition rich in iron and magnesium and relatively poor in silicon.

What is PPM

This stands for parts per million. It is important to understand that this is in mass not volume. So if we had 10,000 ppm Li2O this would be 1% by mass of lithium oxide.

It makes a big difference as, for example, the density of lithium oxide is 2.01, whereas the density of gold is 19.3 so the volume of gold would be much less than than that of lithium for the same . We use mass here technically, not weight, because mass would not change in lower or higher gravity environments like the moon or a meteorite whereas weight would. On earth the terms can be used interchangeably.

What is LCE ?

This stands for Lithium Carbonate Equivalent. Lithium itself is a highly reactive metal and so what trades is typically lithium carbonate Li2CO3 or lithium hydroxide LiOH. These have different densities from lithium oxide in hard rock or lithium chloride in brine, so an adjustment factor has to be used. The density of lithium oxide Li2O is 2.01 g/cm3 and that of Li2CO3 is 2.11 g/cm3, and LiOH is 2.54g/cm3. So using the adjustment factor, 50,000 tonnes Li2O equivalent is equivalent to 50,000 x 2.11/2.01 = 52,488 tonnes of Li2CO3.

What is LCT

This stands for Lithium Caesium Tantalum pegmatites

What is a NSR

This is a regularly used type of royalty, and NSR means Net Smelter Royalty. Broadly speaking a 1% NSR is calculated as 1% of the gross value of what is sold minus 1% of the ongoing operating costs to produce it (but excluding the capital or interest costs to build the smelter).

What is a Pegmatite

Pegmatite is a coarse-grained intrusive igneous rock formed from magma that crystallised below the Earth's crust. This broadly is the type of rock that contains mineral deposits such as spodumene, lepidolite or petalite that contain the lithium. Not all pegmatites contain lithium, and pegmatites can also be a source of other minerals such as tin, beryl, and tantalum.

What is PGE

Nothing to do with pegmatite ! It stands for Platinum Group Elements, meaning platinum, palladium, iridium, osmium, rhodium and ruthenium. ILC currently has no position in these elements.

What is a Pluton

This is a geological formation. Plutons are bulbous masses that commonly develop beneath strings of volcanoes. Batholiths may contain hundreds of plutons


This stands for present value or net present value, looking at all forecast cash inflows and outflows. This number tends to be presented as one number but in reality it is highly sensitive to the input assumptions into the model, specifically :

a) The lithium price or commodity price

b) The inflation rate used for the commodity price and for costs

c) The output per annum and the life of mine

d) The discount rate used

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