Savannah Resources to restart drilling at Barroso

Savannah Resources (AIM: SAV) will immediately restart fieldwork and drilling at its Barroso Lithium Project in Portugal, following a decision by the Portuguese state to lift a temporary suspension order.

The British company suspended prospecting work at the beginning of the month due to a precautionary injunction filed in court by some landowners covering land that is not owned by the company.

Savannah said in a statement that the government had filed a “reasoned resolution” citing broader public interest. The government argued that any postponement of the work “is more costly and seriously detrimental to the public interest,” according to Savannah’s statement.

Following the news, shares of Savannah were trading down 1.02% at £4.36 per share in London on Friday afternoon, giving the company a £95 million ($120 million) market capitalization.

The company has said Barroso’s spodumene deposit is the most significant in Europe, and the latest prospecting results suggest a larger deposit than the previously estimated 28 million tonnes of high-grade lithium for batteries.

However, the project has faced opposition from locals and environmentalists, including protests, legal challenges, and refusals to sell land. Approximately 24% of the required land is privately owned, while 75% consists of traditional “baldios,” or common land.

First output in 2027

Savannah plans to construct four open-pit mines in the region to produce enough lithium annually for 500,000 to 1 million electric vehicle batteries. The company aims to accelerate the project, targeting first commercial output by 2027.

Barroso is expected to have a throughput of about 1.5 million tonnes annually over its estimated 14-year mine life, based on a resource of 20.5 million tonnes at 1.05% lithium oxide.