Surge Battery Metals Inc. (TSXV: NILI) has released results of a Pre-Feasibility Study (PFS) for its Nevada North Lithium Project in Elko County, Nevada, delivering an after-tax net present value of US$9.81 billion at an 8% discount rate and an after-tax internal rate of return of 23.6%. The study, led by Fluor Corporation, outlines a two-phase open-pit operation targeting battery-grade lithium carbonate from high-grade claystone ore over a 42-year mine life. The results represent an improvement across nearly every key metric compared with the 2025 Preliminary Economic Assessment, positioning the project as a potential large-scale domestic lithium supplier for the North American battery industry.

Key Points

  • Surge Battery Metals Inc. (TSXV: NILI / OTCQX: NILIF / FSE: DJ5) announced the Nevada North Lithium Project PFS on October 2, 2026
  • After-tax NPV8% of US$9.81 billion and after-tax IRR of 23.6%, with a 4.2-year payback from the start of production
  • Phase 1 initial capital of US$2.77 billion; average life-of-mine operating cost of US$4,719 per tonne of lithium carbonate, 10% below the 2025 PEA estimate
  • Investors may be watching the timeline for FEL 3 engineering commencement, targeted for Q4 2026, and the feasibility study advancement with joint-venture partner Evolution Mining

Two-Phase Production Plan Targets 111,400 Tonnes Per Year Peak Output

The PFS contemplates a conventional open-pit, free-digging mine requiring no blasting in the main pit, with a low waste-to-ore strip ratio of 0.88:1. Phase 1 establishes a processing plant designed for approximately 55,900 tonnes per year of battery-grade lithium carbonate, while Phase 2 doubles capacity, with production peaking at approximately 111,400 tonnes per year and averaging approximately 92,250 tonnes per year over the life of mine. The project is held through Nevada North Lithium LLC, a joint venture 67.5% owned by Surge and 32.5% by Evolution Mining Limited. First production is targeted for the second half of 2031, subject to permitting, financing, and a final investment decision.

Mineral Reserve of 218.3 Million Tonnes Underpins 42-Year Mine Life

IMC prepared a Mineral Reserve estimate, effective July 28, 2026, of 218.3 million tonnes at 3,928 parts per million lithium, containing 4.56 million tonnes of lithium carbonate equivalent, comprising 81.6 million tonnes Proven and 136.7 million tonnes Probable. The PFS mine plan contains no Inferred Mineral Resources. Total Measured and Indicated Mineral Resources stand at 657.5 million tonnes at 3,007 ppm lithium, with an additional 271.3 million tonnes Inferred, prepared by RESPEC. Overall process lithium recovery is 84.9%, up from 82.8% in the 2025 PEA, supported by metallurgical work completed by Sepro Laboratories and Kemetco Research Inc.

Battery-Grade Product Demonstrated End-to-End From Nevada Claystone

A complete processing flowsheet from run-of-mine claystone to battery-grade lithium carbonate has been demonstrated during PFS metallurgical test work. Kemetco produced a lithium carbonate assaying 99.0% Li₂CO₃, which was subsequently refined by Chemshift Technologies Inc. of Calgary, Alberta, to a battery-grade product of 99.95% Li₂CO₃. The on-site sulfur-burning sulfuric acid plant is designed to generate most of the site's power requirements through waste heat recovery. Reagent procurement and logistics represent approximately 64% of total operating costs and are identified as a key optimisation focus during the next phase of engineering.

Project Economics Remain Positive Across Full Sensitivity Range Tested

The PFS economic model assumes a long-term lithium carbonate price of US$24,000 per tonne, 100% equity financing, and constant Q2 2026 dollars. After-tax NPV8% remains positive across the full ±30% range of every variable tested, including approximately US$4.6 billion at a 30% lower lithium carbonate price of US$16,800 per tonne. The project is expected to generate approximately US$11.4 billion in federal and state taxes, property tax, and royalties over the life of mine. A technical report prepared in accordance with NI 43-101 will be made publicly available on the company's website within 45 days of the announcement.