Western Australia-based European Metals received an offer from Krupa Global Investments to purchase the Cinovec lithium deposit, which is located northwest of Prague.
Cinovec is the largest lithium deposit in Europe.
According to the firm, it did not give consideration to this indicative offer because the letter from Krupa Global Investments did not detail price, terms or conditions.
KGI has released the letter to the Czech media, but European Metals stated that it did not have any discussion with KGI over the transaction.
This offer was made on behalf of the Ceske Lithium company, which is a member of the KGI Group in the Czech Republic.
European Metals, through its subsidiary Geomet s.r.o, has secured the control of the mineral exploration licenses awarded by the Czech state.
The Cinovec lithium-tin project was bought by European Metals in 2012. The minewas closed in 1993 and then rehabilitated seven years later.
In November 2018, European Metals began geotechnical studies and finished preliminary feasibility study. This indicated a post-tax net present value of $540m.
The project has an initial probable ore reserve of 34.5 million tonnes at 0.65% lithium oxide and 0.09% tin.
The mine is expected to have an annual production of 22,800t of lithium carbonate for the first 20 years.
The mine is situated in proximity to car manufacturers and lithium ion battery manufacturers, reported Australian Mining.
In an ASX statement, European Metals stated: “The economic viability of Cinovec has been enhanced by the recent strong increase in demand for lithium globally, and within Europe specifically.”