In another body blow to all those trying to stop the open pit lithium mine due to transform the landscape of Covas do Barroso, the Portuguese government has provided the company behind the venture – Savannah Resources PLC – with a non-reimbursable grant valued at up to €110 million.
The ‘controversial’ mine (given the strength of local/ environmental feeling against it) is seen as the top spodumene lithium resource in Europe.
Located in and around Covas do Barroso, its estimated reserves exceed 39 million metric tons of spodumene ore, grading over 1% lithium oxide. This is what makes it ‘Europe’s largest spodumene deposit seen by the European Commission as “crucial for producing lithium concentrate used in batteries for electric vehicles and energy storage”.
The specialist press stresses that in comparison to other European spodumene resources, Barroso ‘stands out for its scale’.
There is a project operated in Finland, for example, but its reserves are “significantly smaller”. Also, Austria’s Wolfsberg project, run by European Lithium Ltd, is considered significant – but its production is not due until later in the decade.
Savannah, however, is gunning for production relatively soon. It is forecast that the Barroso project could produce about 2.6 million metric tons of spodumene concentrate over 14 years grading at 5.5 per cent lithium oxide.
Mining media concedes that the Barroso project’s ‘controversy’ stems from environmental and social concerns – particularly fears of damage to protected landscapes, biodiversity and water resources.
Local residents and NGOs oppose the open-pit operations, citing potential disruption to community rights and cultural heritage – while experts in the field point to risks that are being ignored by the government, and Brussels, on the basis that the project is ‘vital for Europe’s energy transition, reducing reliance on imports from China’.
Public consultations have highlighted the concerns that have lead to legal challenges and United Nations scrutiny under the Aarhus Convention for possible breaches of public participation rights.
But, to date, nothing has changed the path of what is seen by authorities as ‘a necessary sacrifice for progress’
On the financial front, Savannah Resources maintains a solid yet developing position. As of January 9, its market capitalisation stands at approximately US$169.6 million with an enterprise value of US$157.5 million, say reports.
The company raised US$6.45 million in 2025 to fund post-feasibility work.
Savannah has advanced drilling beyond 50,000 metres while progressing toward a definitive feasibility study and attaining environmental licensing.
With the EU designating Barroso as strategic under the Critical Raw Materials Act, Savannah is seeking to commence production in 2028. Ramping up mining and processing activities “will position the company as a key player in Europe’s lithium sector despite ongoing challenges”, says mining media.
Reacting to news of the grant earlier this week, Savannah CEO Emanuel Proença said: “There are multiple social and economic benefits associated with bringing our project into production, including creating a new industry and economic growth for Portugal, providing a domestic source of responsibly produced lithium raw material for Europe’s greater energy independence, and bringing much needed development and job opportunities to the Barroso region and the wider northeast of Portugal.
“We are conscious of the responsibility we have to deliver a project in accordance with the best international standards and to the benefit of many people and entities on the ground in the Barroso region with whom we already work. We are committed to fulfilling the demands and responsibilities associated with Portuguese State investment, and we have strong confidence in the state’s commitment to continue to do its part in making Portugal’s lithium battery value chain a success for the country’s current and future generations.”
Sources: London Stock Exchange news/ mining.com/ Mugglehead Magazine
