Savannah Resources PLC – Option to Acquire at Aldeia Exercised

Savannah Exercises Option to Acquire the Aldeia Mining lease application, adding to its Flagship Mina do Barroso Lithium Project.

Highlights

• Savannah adds to its 100% owned Mina do Barroso Lithium Project portfolio in northern Portugal with the exercise of the Aldeia Option to Acquire the Aldeia Mining Lease Application areas
• Acquisition Option exercised over the 2.94km² Aldeia Mining Lease application areas following excellent drilling results to date and declaration of Maiden JORC Resource
• The Aldeia Mining Lease application consists of three blocks (A, B and C) located adjacent to Mina do Barroso
• A maiden JORC Mineral Resource Estimate of 3.5Mt at 1.3% Li₂O was published for one deposit on Block A in May 2019 confirming that;
  –  A significant, well mineralised pegmatite body is present
  –  The deposit remains open to further resource extension
  –  There is potential for further mineralised pegmatites within the vicinity of the main Aldeia pegmatite
• Further evaluation work planned on remaining blocks, all of which are prospective for pegmatite-hosted lithium mineralisation
• Acquisition to be made using a long-term, staged payment structure, commencing once the Mining Lease Application has been granted and the transfer of the mining rights to a Savannah nominee approved

Savannah Resources plc (AIM: SAV, FWB: SAV and SWB: SAV), the AIM quoted resource development company, confirms that, further to the announcement of 25 September 2018, it has now exercised its option with private Portuguese company Aldeia & Irmão S.A. to purchase a Mining Lease application which, once granted, will cover areas of land bordering the Company’s Mina do Barroso Lithium Project in northern Portugal.  To view the press release with the illustrative maps and diagrams please use the following link:

http://www.rns-pdf.londonstockexchange.com/rns/4080D_1-2019-6-25.pdf

Savannah’s CEO, David Archer said: “Our decision to exercise the Option granted by Aldeia over the three blocks which make up the Mining Lease Application follows the excellent exploration results recorded to date and the maiden JORC Mineral Resource Estimate made on one pegmatite deposit situated in Block A.  As previously reported, the drilling on Block A has returned the highest grade lithium intercept associated with the Mina do Barroso Project to date of 45m at 1.67% Li₂O, including 22m at 2.00% Li₂O, and the initial 3.5Mt Indicated and Inferred Mineral Resource Estimate averages 1.3% Li₂O or c.25% higher than the current average for the Mina do Barroso deposits.  The Aldeia deposit also remains open to further resource expansion and bears many similar characteristics to the Grandao orebody, located just 2km away.

“Following the recent acquisition of the minority 25% shareholding in Mina do Barroso, our decision to now acquire the adjacent Aldeia blocks further demonstrates Savannah’s intention to secure and develop a strategically significant, long life, spodumene lithium operation in northern Portugal.

“We believe the addition of the Aldeia blocks to our portfolio of lithium assets will both benefit and complement the Mina do Barroso Lithium Project by providing an increased Li₂O resource inventory, as well offering more flexibility in locating the Project’s surface infrastructure.

“Our Portuguese operations will provide the lithium raw material required for the significant market demand predicted to develop in Europe over the next decade.  Following our increase of the Mineral Resources, resulting in the potential for an increase to the life of mine (‘LOM’) of the Project, Savannah’s spodumene lithium production will be key to groups interested in securing lithium chemicals in Europe, which is a high priority for the EU and highlights Savannah’s potential role in the development of Western Europe’s nascent lithium supply chain. Global lithium production deficits will likely drive lithium prices higher in the next few years and will provide an excellent industry setting for Savannah.

“Furthermore, the payment structure of the deal is attractive for Savannah, as the Company will pay for the acquisition via instalments over a 6-year period.  These instalments will commence once the current Mining Lease Application has been approved and transferred to a Savannah subsidiary company.  We are very pleased with our decision to exercise our Option to Acquire Aldeia and firmly believe it will be pivotal in Savannah’s journey towards expanding our mine life and firmly embedding ourselves at the heart of the lithium raw material market with a high grade and reliable product.”