JV Article: Frontier Lithium building Lithium District on Ontario's Electric Avenue

Frontier Lithium Inc. (TSXV: FL; US-OTC: HLKMF) is the largest landholder in northwestern Ontario's emerging Electric Avenue lithium district. Frontier tabled a prefeasibility study (PFS) in March 2018 for its PAK lithium deposit, located on the Electric Avenue, and is continuing to show the district's potential with its latest discovery, the Spark pegmatite.

"The vision is that the PAK project will lay the foundation to build up the lithium ecosystem in Ontario to participate in high tech glass and the electrification of transportation markets," says Frontier Lithium President and CEO Trevor Walker.

Location map of Frontier Lithium Inc.'s PAK lithium deposit in northwestern Ontario. Credit: Frontier Lithium Inc.

Frontier Lithium discovered the Spark pegmatite last September, sitting 2.3 km northwest of the PAK deposit. The company would cut eight channels at Spark over the next month ranging from 11 metres to 79 metres long. In total, it sampled 236 metres at an average grade of 1.91% lithium oxide.

"We have a district with world-class grades and low impurities, such as low iron," Walker says. "What we see with this new showing is the potential to increase tonnage very efficiently."

For example, channels 33 to 35 represent one 64-metre cut grading 2.05% lithium oxide including 34 metres at 2.18% lithium oxide. "By surface area it appears at least two times larger than the PAK deposit," Walker says. "We believe that with the potential of adding Spark to the PAK project, the ingredients are there to place the province on the map as a premium lithium jurisdiction in North America."

Milburn Meekis of Deer Lake showing off some of the highest grade lithium ever drilled in North America. It contains in excess of 50% spodumene and is part of a 5 m zone averaging 4.9% Li2O and was intersected during the latest round of drilling on Frontier Lithium Inc.'s PAK lithium project in Ontario. Credit: Frontier Lithium Inc.

The company commenced a maiden diamond drill campaign at Spark in early February 2019. The company will drill approximately 1,250 metres across four holes to determine the orientation and thickness of the pegmatite below surface. The company also identified another lithium showing about 30 km away up the Electric Avenue and plans to follow up on that showing during a regional exploration program this summer.

The Pak deposit currently contains 5.77 million proven and probable tonnes grading 2.0% lithium oxide across a potential open pit and underground operation. The resource remains open at depth as well as along strike to the northwest and southeast.

According to the 2018 PFS on PAK alone, the project would generate $700 million in after-tax cash flow across a 16 year mine life - 11.5 years of open pit mining followed by 4.5 years of underground mining. It has a $301 million after-tax internal rate of return at an 8% discount rate and a 38.3% after-tax internal rate of return.

A mine at PAK would produce 1.14 million tonnes of technical grade concentrate at 7.2% lithium oxide and 115,500 tonnes of chemical grade concentrate at 6.6% lithium oxide for $147 million in pre-production capital and $37 million in sustaining capital. The bulk of the output is technical grade concentrate that could be used directly by manufacturers for products such as ceramic-glass stovetops and high end displays including latest generation Gorilla and iPhone glass.

"We take a phased approach to development for the project," Walker says. "Because it's low impurity, you can make a concentrate that has significant value at a low capital requirement for premium glass makers first. "It's a no-brainer that down the road we could further refine premium concentrates to produce high-quality lithium salts for batteries on the low end of the cost curve, but mines build chemical plants - not the other way around - so let's crawl before we walk, and walk before we run."

Shares of Frontier Lithium are currently trading at 37 ? within a 52-week range of 30 ? to 85 ?. The company has a $56 million market capitalization and more than $1 million in cash.

"Frontier Lithium is a really tightly held company run out of Sudbury - Canada's premier mining camp to supply the nickel, cobalt and copper required for Ontario's participation in the green energy economy," Walker says. "The premium lithium assets to complete the circuit are right here in Ontario as well where Canadian's maintain a controlling position.

"It's on the Electric Avenue in northern Ontario and it's a great catalyst for sustainable northern development here in our province."

- The preceding Joint-Venture Article is PROMOTED CONTENT sponsored by Frontier Lithium Inc. and compiled in cooperation with The Northern Miner. Visit www.frontierlithium.com for more information, and visit the company at Booth #3236 in the Investors Exchange at PDAC 2019.