Savannah Resources raises lithium reserve estimate at Portugal mine project by 40%

By Sergio Goncalves

LISBON (Reuters) -London-listed Savannah Resources said on Monday it has increased its estimate for the reserves of its lithium mine project in northern Portugal by 40% after completing additional prospecting work.

The estimated reserves of the Barroso deposit of spodumene — a lithium-bearing mineral — now stand at more than 39 million metric tons, up from the previous 28 million metric tons, which was already the largest such deposit in Europe, the company said in a statement.

Savannah said in a statement that "this substantial growth in resources" boosts the strategic importance of the project.

"This is both as a major contributor of raw lithium material to Europe's battery value chain, but also as a significant, long-term value creator for the local region," it said.

The company, which plans to build four open pit mines in the northern Barroso region to extract enough lithium each year for about half a million batteries for electric vehicles, expects to start production in 2027.

The success of projects like Savannah's in Portugal is seen as a key test of Europe's ability to reduce its dependence on imports from China and other countries for lithium and other materials essential to the transition to non-fossil fuel energy consumption.

However, Savannah has faced strong opposition from local residents and environmentalists as the project is in the Barroso region, which has been a World Heritage site for agriculture since 2018.

Barroso is Savannah's only venture and the company is working to complete the project's definitive feasibility study and final environmental licensing process by the end of the year.

(Reporting by Sergio Goncalves, editing by Inti Landauro and Susan Fenton)