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European Lithium Limited (ASX: EUR, FRA: PF8, OTC: EULIF) (European Lithium or the Company) is pleased to announce Critical Metals Corp. (Critical Metals or CRML) has entered into a share subscription facility for up to US$125.0M from GEM Global Yield LLC SCS (GEM), a Luxembourg based private alternative investment group. Proceeds from the facility are expected to be used to fund the development of the Wolfsberg Lithium Project in Austria (Wolfsberg or Wolfsberg Project).
HIGHLIGHTS
- Critical Metals has signed an agreement for a share subscription facility for up to US$125.0M in transaction funding from Global Emerging Markets (GEM)
- Critical Metals expects to provide an update on further equity funding in the near term
- Funding will principally be used to accelerate the development of the Wolfsberg Lithium Project in Austria.
Tony Sage, Chairman, commented: “Receiving this significant and binding commitment is a huge milestone for the Company. Combined with European Lithium’s recent deal with Saudi Arabian based, Obeikan Investment Group, the Company and Critical Metals have secured approximately 65% of the total expected capex of the Wolfsberg Project and brings us closer to our stated goal to be the first local producer of lithium spodumene for the green energy transition in Europe.”
Under the terms of the definitive agreement, Critical Metals will have access to up to US$125.0M in incremental capital to fund its operations upon closing of the business combination transaction. The facility would enable Critical Metals, in its discretion but subject to the terms and conditions set forth in the definitive agreements, to draw down funds (up to US$125.0M) through the issuance of new shares directly to GEM over a three-year period after the closing of the transaction. Assuming no further redemptions are made by public stockholders of Sizzle Acquisition Corp. (Sizzle) in connection with its shareholder vote to approve the transaction, Critical Metals would now be expected to have access to up to ~US$175.0M in transaction proceeds (comprising of the GEM finance package and existing cash reserves).
The GEM finance package, together with European Lithium’s additional funding secured through the binding term sheet with Obeikan Investment Group (Obeikan)(refer to EUR announcement dated 2 June 2023), are expected to provide Critical Metals and European Lithium with significant capital to accelerate the development of the Wolfsberg Project once the transaction with Sizzle completes.
The Company can report substantial progress has been made in the development plan for the Wolfsberg project with the achievement of several key milestones highlighted by:
- Mining permit secured - spodumene mined from the project successfully demonstrated its capability to supply high-purity lithium (99.6% lithium carbonate equivalent) at pilot plant.
- Mineral Resource Estimate1 - 12.88 Mt of Measured, Indicated and Inferred classified Resources at 1.00% Li2O grade in Zone 1 only:
- Economic viability - Definitive Feasibility Study (DFS)2 that demonstrates a post-tax NPV of US$ 1.5 billion @ WACC13 6%, mined over approximately 15 years.
- Binding offtake agreement with top-tier auto manufacturer secured - direct long term lithium hydroxide supply agreement with BMW4.
- Binding agreement to build hydroxide plant - partnership with Obeikan to build lithium hydroxide processing plant in Saudi Arabia with significant cost savings expected.
- Advanced project with drilling upside – established mine and current resource estimate based only on Zone 1 with drilling undertaken showing prospectivity in Zone 2.
For full details of the DFS, please refer to EUR announcement dated 8 March 2023, “Wolfsberg Lithium Project Definitive Feasibility Study Results”. The Mineral Resources underpinning the Ore Reserve have been prepared by a competent person in accordance with the requirements of the JORC Code (2012). The Competent Person’s Statement(s) are found in the section of this ASX release titled “Competent Person’s Statement(s)”. European Lithium confirms that it is not aware of any new information or data that materially affects the information included in that release. All material assumptions and technical parameters underpinning the estimates in that ASX release continue to apply and have not materially changed.
Click here for the full ASX Release
This article includes content from European Lithium Limited, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
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European Lithium
Overview
As the global push to halt climate change gains momentum, the European Commission is looking to regionalize the battery supply chain to capitalize on the rapid electric vehicle (EV) growth and limit its dependency on other countries through heavy investment and policy changes. Europe’s electric vehicle market value reached US$29.49 million in 2021 and is projected to increase up to US$143.08 million by 2027, indicating a compounded annual growth rate of 23.4 percent in that period.
Even though Europe is one of the largest global producers of motor vehicles, it currently does not have a local supply of lithium hydroxide which is heavily used in EV battery technology. According to experts, the market is set to remain in a structural shortage until 2025
One company that aims to become the first local lithium supplier into an integrated European battery supply chain is European Lithium (ASX:EUR,FRA:PF8), a mining exploration and development company focused on exploring, identifying and acquiring lithium in Europe. The company is led by a management team with decades of experience and success in the mining and finance markets.
“Our aim is to be the first supplier of lithium from Europe, for Europe,” European Lithium chairman Tony Sage said.
The company is focused on its wholly owned Wolfsberg Lithium project located in Carinthia, Austria. The pre-existing mine is located in a mining-friendly region with multiple mineral discoveries in the surrounding area. The property features a high-grade lithium resource at an average grade of one percent lithium hydroxide, with a total resource of 12.88 million tonnes based on resources measured, indicated and inferred in zone 1 only.
The Wolfsberg Lithium project resource has the potential to double based on positive drill results in another zone on the property.
Based on the definitive feasibility study (DFS) released in March 2023, Wolfsberg Lithium Project is well positioned to become a leading producer of battery-grade lithium hydroxide in Europe. It is set to deliver high returns, leveraging low operating costs, and benefiting from a lithium market that is anticipated to be in structural undersupply during most of the life of mine. The battery-grade lithium hydroxide monohydrate (LHM) prices modeled in the DFS are projected to be at a 39-percent discount to current spot prices in 2025 and then escalate by 2 percent per annum. The estimated capex is US$866 million which supports a post-tax NPV of US$1.5 billion.
European Lithium has established several strategic relationships with an aim to deliver value to the Wolfsberg Lithium Project through development and during production. This includes a partnership with KMI for liaising with Austrian authorities.
The company commissioned Dorfner Anzaplan to construct the pilot plant, which was successfully completed on schedule. Anzaplan has also overseen the completion of metallurgical test work on bulk ore extractions. Testing will allow significantly higher recovery rates at the start of production as opposed to only assessing metallurgical data from the core as other mining companies often do, giving European Lithium the advantage of a streamline refinement process.
The company has support from the European Battery Alliance, GREENPEG and other government initiatives, believing it has the potential to become a major, first-to-market producer of lithium in Europe. The company also remains committed to clean production in an effort to support sustainability.
Based on the DFS, the company plans to begin the permitting process of its Wolfsberg Lithium project and prepare the mining plan for the mining authority to authorize the mine and concentrator construction. Afterward, the company will determine the approval requirements of the carbonate hydroxide conversion plant with the Energy Information Administration (EIA) and then initiate the final financing plan.
European Lithium, through its wholly owned Austrian subsidiary ECM Lithium Aľ GmbH (ECM), signed a binding long-term lithium offtake agreement with top-tier European auto manufacturer BMW to secure the company’s first offtake of battery grade lithium hydroxide from its Wolfsberg Lithium Project in Austria.
The company is aiming to commence production of lithium hydroxide from the project in 2027 — subject to funding and approvals by the Austrian government.
In a bid to expand its project portfolio, European Lithium executed a binding Heads of Agreement with 2743718 Ontario Inc., a subsidiary of Richmond Minerals (TSXVRMD), to acquire 100 percent of the rights, title and interest in the Bretstein-Lachtal Project, Klementkogel Project and the Wildbachgraben Project, a group of exploration licenses covering 114.6 square kilometers, targeting lithium with known occurrences in the Styria mining district of Austria.Company Highlights
- European Lithium is a mining exploration and development company focused on exploring, identifying and acquiring lithium in Europe.
- The company aims to become the first local lithium supplier into an integrated European battery supply chain.
- The company’s focus is on its wholly owned advanced Wolfsberg Lithium Project (Wolfsberg) located in Carinthia, Austria.
- Wolfsberg is a high-grade lithium resource at an average grade of one percent lithium oxide, with a total resource of 12.88 million tonnes based on measured, indicated and inferred resources in zone one only.
- Wolfsberg’s definitive feasibility study results demonstrate potential to deliver high returns, leveraging low operating costs, and benefiting from a lithium market that is anticipated to be in structural undersupply during most of the life of mine.
- The Wolfsberg resource estimate has significant upside with the potential to double based on positive drill results.
- Through its wholly owned Austrian subsidiary ECM Lithium Aľ GmbH (ECM), European Lithium signed a binding long-term lithium offtake agreement with top-tier European auto manufacturer BMW AG (BMW) to secure the company’s first offtake of battery-grade lithium hydroxide from Wolfsberg.
- The company has signed a binding agreement to build a Saudi Arabia-based hydroxide processing plant in partnership with Obeikan and deliver significant cost savings.
- The company is led by a management team with decades of experience and success in the mining and finance markets.
- European Lithium entered into a business combination agreement with Sizzle Acquisition, a US special purpose acquisition company, to which European Lithium will sell down its interest in its wholly owned Wolfsberg Lithium Project (Wolfsberg and Wolfsberg Lithium Project) and merge with Sizzle via a newly formed, lithium exploration and development company named, Critical Metals Corp.
- European Lithium has acquired 100 percent of the rights, title and interest in the Bretstein-Lachtal Project, Klementkogel Project and the Wildbachgraben Project, a group of exploration licenses covering 114.6 square kilometers, targeting lithium with known occurrences in the Styria mining district of Austria and nearby the Wolfsberg Lithium Project
- The company received high-grade lithium assays from sampling undertaken at various prospects within the Eastern Alps Lithium Satellite Projects, located in Austria, which are held 20 percent by European Lithium and 80 percent by EV Resources Limited (ASX: EVR).
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Where Does Tesla Get its Lithium?
In a mid-2023 Tesla earnings call, Musk seemed relieved to see prices for the battery metal had declined. “Lithium prices went absolutely insane there for a while,” he said. Lower battery prices will bring EVs closer to cost parity with internal combustion engines vehicles, leading to wider adoption and increased demand.
During the 2024 US presidential election, Musk threw his support behind Republican candidate and former president Donald Trump, who has been historically critical on electric vehicles and subsidies. Following Trump's election win on November 5, AP News reported that these stances could support Tesla as they would be more likely to harm smaller competitors who were less established than the EV giant. Tesla's share price shot upwards in response to the election outcome.
In the spring of 2024, Musk invited Argentine President Javier Milei to the Tesla factory in Austin, Texas, where the two reportedly discussed the investment opportunities in Argentina's lithium sector. As a prominent member of the prolific Lithium Triangle, the South American nation is the fourth leading lithium producer by country.
Australia's hard-rock deposits and Chile's brines are also top sources for the world's lithium supply. But lithium refining is dominated by China, which accounted for 72 percent of global lithium processing capacity in 2022.
With the limelight on Musk and Tesla, investors should know where the electric car company sources its lithium.
Read on to learn more about where Tesla gets its lithium, how much lithium is in a Tesla battery and what the EV maker is doing to better secure its lithium supply chain.
In this article
Which lithium companies supply Tesla?
Tesla has deals with multiple lithium suppliers, some that are already producers and some that are juniors developing lithium projects.
At the end of 2021, Tesla inked a three-year lithium supply deal with top lithium producer Ganfeng Lithium (OTC Pink:GNENF,SZSE:002460), and the Chinese company began providing products to Tesla starting in 2022. Major miner Arcadium Lithium (NYSE:ALTM,ASX:LTM), which is set to be acquired by Rio Tinto (ASX:RIO,NYSE:RIO,LSE:RIO), also has supply contracts in place with the EV maker.
China’s Sichuan Yahua Industrial Group (SZSE:002497) agreed to supply battery-grade lithium hydroxide to Tesla through 2030. Under a new, separate agreement finalized in June 2024, Yahua is set to supply Tesla with an unspecified amount of lithium carbonate between 2025 and 2027, with the option to extend the contract by another year.
Liontown Resources (ASX:LTR,OTC Pink:LINRF) is set to supply Tesla with lithium spodumene concentrate from its AU$473 million Kathleen Valley project. The deal is for an initial five year period set to begin this year, and production began in July 2024.
In January 2023, Tesla amended its agreement with Piedmont Lithium (ASX:PLL,NASDAQ:PLL), which now supplies the US automaker with spodumene concentrate from its North American Lithium operation, a joint venture with Sayona Mining (ASX:SYA,OTCQB:SYAXF). The deal is in place through the end of 2025.
Even though Tesla has secured lithium from all these companies, the EV supply chain is a bit more complex than just buying lithium directly from miners. Tesla also works with battery makers, such as Panasonic (OTC Pink:PCRFF,TSE:6752) and CATL (SZSE:300750), which themselves work with other chemical companies that secure their own lithium deals.
What are Tesla batteries made of?
Tesla vehicles use several different battery cathodes, including nickel-cobalt-aluminum (NCA) cathodes and lithium-iron-phosphate (LFP) cathodes.
Tesla is known for using NCA cathodes developed by Japanese company Panasonic. This type of cathode has higher energy density and is a low-cobalt option, but has been less adopted by the industry compared to the widely used nickel-cobalt-manganese (NCM) cathodes. Aside from that, South Korea's LG Energy Solutions (KRX:373220) supplies Tesla with batteries using nickel-cobalt-manganese-aluminum (NCMA) cathodes.
As mentioned, it wasn’t just lithium that saw prices climb in 2021 — cobalt doubled in price that same year, and although it has declined since then, the battery metal remains essential for many EV batteries. Most cobalt mining takes place in the Democratic Republic of Congo, which is often associated with child labor and human rights abuses, fueling concerns over long-term supply.
That said, not all Tesla’s batteries contain cobalt. In 2021, Tesla said that for its standard-range vehicles it would be changing to lithium-iron-phosphate (LFP) cathodes, which are cobalt- and nickel-free. At the time, the company was already making vehicles with LFP chemistry at its factory in Shanghai, which supplies markets in China, the Asia-Pacific region and Europe.
In April 2023, Tesla announced that it planned to use this type of cathode chemistry for its short-range heavy electric trucks, which it calls "semi light." The company is also looking to use LFP batteries in its mid-sized vehicles.
At the top of 2024, Tesla made moves to produce LFP batteries at its Sparks, Nevada, battery facility in reaction to the Biden Administration's new regulations on battery materials sourcing, especially on those sourced from China. Reuters reports Tesla battery supplier CATL will sell idle equipment to the car maker for use at the plant, which will have an initial capacity of about 10 gigawatt hours.
What company makes Tesla’s batteries?
Tesla works with multiple battery suppliers, including Panasonic, its longtime partner, as well as LG Energy Solutions, the second largest battery supplier in the world. They supply the EV maker with cells containing nickel and cobalt.
China's CATL has been supplying LFP batteries to Tesla for cars made at its Shanghai plant since 2020. It’s also been reported that BYD Company (OTC Pink:BYDDF,SZSE:002594) is supplying Tesla with the Blade battery — a less bulky LFP battery — which the car manufacturer has used in some of its models in Europe.
Additionally, BYD is set to work with Tesla on its battery energy storage systems (BESS) in China, with a plan to supply 20 percent of Tesla's anticipated BESS manufacturing capacity, with CATL expected to cover 80 percent. The factory, which began production at the close of 2024, uses the companies' LFP batteries.
How much lithium is in a Tesla battery?
How much lithium do Tesla batteries actually contain? That question is tricky because many factors are at play. Typically, it depends on battery chemistry, as demonstrated by the chart below, as well as battery size.
For example, the standard Tesla Model S contains about 138 pounds, or 62.6 kilograms, of lithium. It is powered by a NCA battery, which has a weight of 1,200 pounds or 544 kilograms.
The amount of lithium in a Tesla battery can also vary based on model and year as the battery chemistries and weights are often changing with each new iteration.
Back in 2016, Musk said batteries don't require as much lithium as they do nickel or graphite — he described lithium as "the salt in your salad." As the chart below shows, the metal only makes up about a 10th of the materials in each battery.
Metal content of battery chemistries by weight.
Chart via BloombergNEF.
But a key factor to remember is volume — given the amount of batteries Tesla needs to meet its ambitious goals, it could hit a bottleneck if it can’t secure a steady supply of raw materials. Of course, this is true not just for Tesla, but for every carmaker producing EVs today and setting targets for decades to come.
For that reason, demand for lithium-ion batteries is expected to soar in the coming years. By 2030, Benchmark Mineral Intelligence forecasts that demand will grow by 400 percent to reach 3.9 terawatt-hours. Over the same forecast period, the firm sees the current surplus in the lithium supply coming to end.
Will Tesla buy a lithium mine?
For carmakers, securing lithium supply to meet their electrification goals is becoming a challenge, which is why the question of whether they will become miners in the future continues to come up.
But mining lithium is not easy, and despite speculation, it's hard to imagine an automaker being involved in it, SQM’s (NYSE:SQM) Felipe Smith said. “You have to build a learning curve — the resources are all different, there are many challenges in terms of technology — to reach a consistent quality at a reasonable cost,” he noted. “So it's difficult to see that an original equipment manufacturer (OEM), which has a completely different focus, will really engage into these challenges of producing.”
Even so, OEMs are coming to the realization that they might need to build up EV supply chains from scratch after the capital markets' failure to step up, Benchmark Mineral Intelligence’s Simon Moores believes. Furthermore, automotive OEMs that are making EVs will in effect have to become miners.
“I don't mean actual miners, but they are going to have to start buying 25 percent of these mines if they want to guarantee supply — paper contracts won't be enough,” he said.
However, Musk has made it clear to investors that Tesla is more focused on developing its lithium refining capabilities, rather than getting into the mining game.
Where is Tesla's lithium refinery?
Tesla broke ground on its in-house Texas lithium refinery in the greater Corpos Christi area of the state in 2023. Tesla's lithium refinery capacity is expected to produce 50 GWh of battery-grade lithium per year. Construction of the lithium refinery is nearly completed with full production anticipated in 2025.
Tesla's Texas lithium refinery was facing an obstacle in obtaining a contract for the 8 million gallons of water per day needed to run the plant, as the region of South Texas is in the middle of a serious drought and water supplies are tight.
"In December, South Texas Water Authority passed an infrastructure deal that will allow Nueces Water Supply to sell rights to the pipe Tesla will need to obtain water, which was one of the hold-ups for a water deal," Bloomberg BNN reported in early January.
This is an updated version of an article first published by the Investing News Network in 2022.
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Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
Laguna Verde Resource Update
CleanTech Lithium PLC ("CleanTech Lithium" or "CleanTech" or the "Company") (AIM: CTL, Frankfurt:T2N), an exploration and development company advancing sustainable lithium projects in Chile, announces an updated resource estimate for its Laguna Verde project that has been included by the Chile Government as one of the six salar systems to be prioritised for development.
Highlights:
- The mineral resource estimate is updated from that reported in the RNS of 17 July 2023 based on additional exploration and pumping tests conducted in 2024
- The JORC (2012) compliant estimate was calculated by Montgomery & Associates ("Montgomery´"), a leading hydrogeological consultant highly experienced in lithium brine resource estimation
- The total updated resource is 1.63 million tonnes of Lithium Carbonate Equivalent (LCE), at a grade of 175 milligrams per litre (mg/l) lithium, of which 0.81 million tonnes is in the Measured + Indicated category at a grade of 178 mg/l lithium
- This current resource estimate is based on the proposed polygon area included in the Company´s recently submitted application for a Special Operating Contract for Lithium ("CEOL")
- The previous 2023 estimate which totalled 1.77 million tonnes LCE at an average grade of 200mg/l lithium was based on the previously proposed CEOL area under the old application regime that was larger covering the entire estimated resource of the basin.
- Lithium concentrations obtained in the 2024 campaign were below the average grade of other exploration wells impacting the average lithium grade of the resource
- Montgomery recommends three additional drillholes in the southwest, north and northeast to potentially increase the resource based on completed geophysics
- This updated measured and indicated resource estimate will be used in the pre-feasibility study (PFS) which is intended to underpin a maiden reserve estimate for the Laguna Verde project
Steve Kesler, Executive Chairman, CleanTech Lithium said: "The updated JORC-compliant resource estimate for the Laguna Verde project, independently determined by Montgomery & Associates, confirms a robust and significant resource of 1.63 million tonnes of Lithium Carbonate Equivalent (LCE), with 0.81 million tonnes in the Measured and Indicated category at an average grade of 178 mg/l lithium. Now with greater confidence in the resource, this comprehensive evaluation will form the basis for the Pre-Feasibility Study, scheduled for end of this quarter. This positions Laguna Verde as a highly promising direct lithium extraction (DLE) based project in the lithium brine sector and as a contributor to Chile's future as a leading lithium producer for the global EV and battery market."
Further Details:
Project Background
The Laguna Verde corresponds to a lithium brine deposit which is found in the Atacama Region of Chile, near the Chile - Argentina border. The project consists of mining concessions located approximately 192 kilometres (km) northeast of Copiapó. The concession area is readily accessible via a network of paved roads from the closest major city Copiapó, following the route (R-31) for approximately 275 km. The Laguna Verde Basin has elevations that vary between 4,330 to 4,500 metres above sea level (masl), where the low altitude valley area is approximately 20 km long and 4 km wide.
Figure 1: Regional Location Map and Project Area
The previous resource estimate for Laguna Verde was reported in July 2023, based on five wells completed in 2022 and 2023. A drill programme was undertaken in 1H 2024 which completed two infill wells in the first half of 2024 along with three observation wells drilled to support observations during pumping tests. The location of wells completed from 2022 - 2024 are shown in Figure 2, along with three recommended wells to potentially increase the resource.
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Figure 2: Existing and Recommended Exploration Wells at Laguna Verde
Resource Summary
Montgomery was engaged to support the 2024 field programme at Laguna Verde and based on the information obtained to provide an updated resource estimate and technical report for the project. The technical report has been prepared to conform to the regulatory requirements of the JORC Code (2012). Mineral Resources are also reported in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Best Practice Guidelines (CIM, 2012).
The breakdown of the resource categories comprising the total resource estimate and the comparison with the previous 2023 estimate is shown below in Table 1. The previous 2023 estimate which totalled 1.77 million tonnes LCE at an average grade of 200 mg/l Lithium was based on a proposed CEOL area that was larger and covered the entire estimated resource of the basin, whereas the updated 2025 estimate is based on the Company's preferential licences and proposed polygon area included in the Company´s recently submitted application for a CEOL. As a comparison, the current resource estimate for the basin (on the same basis of larger CEOL area) would be 1.95 million tonnes LCE.
Lithium concentrations obtained in the 2024 campaign were below the average grade of other exploration wells impacting the average lithium grade. Although slightly lower than the lithium grade used in the 2023 scoping study a grade of 175 mg/l lithium is very suitable for the DLE process and is well above the cut-off grade of 100 mg/l lithium.
Table 1: Updated JORC Resource Estimate 2025 Compared to 2023 Resource Estimate
Special Operating Contract for Lithium (CEOL)
In April 2024 the Chilean government announced, as part of its National Lithium strategy, the intention to make available to the private sector CEOLs over 26 salt flats. As of September 2024, the Chilean government has prioritised six salt flats for the CEOL award process, one of which is Laguna Verde. The CEOL grants exclusive rights to exploit lithium and only one CEOL is to be granted per saline system. The Government also published a polygon CEOL area for each of the prioritised salt flats but clarified that this polygon area is referential and could be modified following community dialogue and with agreement of the applicant. The Government also announced that the CEOL could be awarded in a streamlined procedure that allowed direct negotiation with Government rather than through a public tender provided that a number of criteria were met. One criteria was that the applicant must demonstrate that it holds at least 80% of the preferential mining licences in the CEOL polygon.
CleanTech Lithium has proposed a modification to the published CEOL polygon in its CEOL application (shown in Figure 3) which has been developed to ensure that over 80% of the proposed CEOL polygon area is preferential mining licenses held by CleanTech. The CEOL application by CleanTech includes letters of support from indigenous communities for the proposed modified CEOL polygon.
Figure. 3: CleanTech´s Preferential Licences and Proposed CEOL Extent
Table 2 provides a breakdown of the current Laguna Verde resource estimate by resource category and by separating the resource attributable to the preferential licences held by the Company, and the provisional resources in licences held by third parties within the proposed CEOL area. The combined resource would be attributable to the Company provided the CEOL is awarded to CleanTech for the proposed area (Figure 3).
Mineral resources are not mineral reserves and do not have demonstrated economic viability. Furthermore, not all mineral resources can be converted into mineral reserves after application of the modifying factors, which include but are not limited to mining, processing, economic, and environmental factors.
Table 2: Mineral Resource Estimate for the Laguna Verde Project (Effective January 3, 2025)
Resource Estimation Method
The updated resource estimate consists of Measured, Indicated and Inferred resources. A detailed geological and resource block model was creating in Leapfrog (Seequent, 2023) using obtained well lithologies, discrete-depth values for brine chemistry, drainable porosity values, and geophysical profiles. Lithium concentrations were interpolated using ordinary kriging, specific yield was assigned to each hydrogeological unit, and the mass calculations within the resource block model were undertaken using the Leapfrog Edge extension. A cut-off grade of 100mg/l lithium was conservatively applied based on the Laguna Verde scoping study capital and operating costs.
Consistent with the Houston et al. (2011) recommendations for immature salars, a 1.25 km radius circle around the well was used to estimate a Measured resource, a 2.5 km radius circle around the well was used to estimate an Indicated resource, while a maximum 5 km radius circle was used as the areal extent to estimate an Inferred resource. Depending on the confidence in the sampling procedures and presence of volcanic outcrops, some resource polygons were limited in extent.
Surface Rights
In Chile, Surface Access Rights should be granted or imposed on a mining concession before the extraction starts. CleanTech Surface Access Rights request was received by Bienes Nacionales on June 16, 2023, in the name of Atacama Salt Lakes SpA and is currently in process. The requested area totals 11,136 hectares and covers the project scoping study planned installations (Ad Infinitum, December, 2022). The requested area can be seen in Figure 4.
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Figure 4. CleanTech's Requested Surface Right Area
Water Rights
There are surface water courses that contribute to the Laguna Verde. The Peñas Blanca River flows from west to east and has a continuous flow throughout the year, while to the east of the Laguna Verde, there are intermittent surface water flows. Freshwater exploration wells also exist in the western portion of the basin with demonstrated pumping rates that exceed 40 L/s (Hydro Exploraciones, 2020). Furthermore, a conceptual water balance of the basin recharge has been prepared and indicates that the average estimated freshwater recharge in the Laguna Verde Basin corresponds to 570 l/s (M&A, 2024a). Potential sources of freshwater for the Project include the application for groundwater rights in the basin or the purchase of water rights from third parties (CleanTech, 2024).
Geological Setting
The regional geology of the Project area is mainly characterised by volcanic and sedimentary sequences. Laguna Verde is an immature clastic salar basin, with the lagoon effectively corresponding to the evaporative "salar nucleus". The Project consists of a lithium-rich aquifer found below the lagoon and in the surrounding sediments. The brine is mainly hosted in volcaniclastic sediments and tuff beneath the lagoon with a moderate hydraulic conductivity.
The Laguna Verde stratigraphy is characterised by a band of tuffs with different grain sizes, consolidation / welding, type of clasts, and locally interbedded volcaniclastic sediments. This unit presents an average thickness of 400 metres and overlays the lower volcanic rock (mainly andesite) identified in drillholes and the gravity survey, which has some fracturing and a low drainable porosity. Furthermore, a fault zone which has highly fractured and brecciated rock was encountered along the southern portion of Laguna Verde. In all, the brine aquifer was characterised up to a maximum depth of 650 metres (LV07).
Figure 5 shows the locations for two NW-SE hydrogeological cross sections, and Figure 6 shows the sections with the hydrogeological units modelled in the Leapfrog software.
Figure 5: Hydrogeological Cross Section Locations
Figure 6: Hydrogeological Cross Sections
Exploration
CleanTech engaged Geodatos to conduct Transient ElectroMagnetic (TEM) geophysical surveys at Laguna Verde during the periods April to May 2021 and again in March 2022. The objective of these surveys was to determine the electrical properties of the subsurface sediments to provide information about the stratigraphy and water quality of the hydrogeologic units in the area. The surveys also helped determine the water table level and helped confirm the presence of brine.
A gravity survey was performed by Geodatos between the end of December 2022 and early January 2023. The survey campaign included TEM measurements and two extra profiles. One hundred and eleven (111) gravity stations, arranged in four lines surrounding the lagoon area, as well as fourteen (14) TEM stations, arranged in two lines, were surveyed with a 400-metre separation.
Figure 7: Laguna Verde Surveyed Gravity and TEM Stations
Drilling
An initial drilling campaign was conducted in 2022 and 2023 with four diamond drill holes (DDH) (LV01, LV02, LV03 and LV04) and two rotary wells (LV05 and LV06) as shown in Figure 2. A second campaign was conducted in 2024, with Montgomery personnel, where two exploration boreholes were drilled (LV07 and LV11) with monitoring wells for subsequent pumping tests at LV05 and LV06. Drilling at boreholes LV07 and LV11 reached a final depth of 650 metres below land surface (mbls) and 412.8 mbls, respectively. A pumping test at LV05 was initially conducted in the first campaign and included a pre-test and a 48-hour constant discharge test on April 8, 2023. During the 2024 campaign, a step-discharge and a constant-discharge were conducted at LV05, but due to adverse weather conditions, a long-term constant rate test could not be completed. During the first campaign, a pre-test and a constant discharge test were conducted at LV06 and a long-term (7-day) constant rate test was conducted during the 2024 campaign.
Table 3: Location and Depth Drilled for Years 2022, 2023 and 2024 Exploration Wells
Well | Drilling Method | Northing | Easting | Total Depth Drilled (m) | Year Drilled |
LV01 | DDH | 7,027,088 | 549,432 | 474 | 2021-2022 |
LV02 | DDH | 7,024,396 | 553,992 | 339 | 2022 |
LV03 | DDH | 7,028,434 | 549,980 | 547.5* | 2022 |
LV04 | DDH | 7,024,390 | 556,826 | 311 | 2022 |
LV05 | Rotary | 7,027,908 | 550,972 | 434.6 | 2022-2023 |
LV06 | Rotary | 7,026,004 | 555,912 | 405 | 2023 |
LVM05a | DDH | 7,027,908 | 550,921 | 221.50 | 2024 |
LVM05b | DDH | 7,027,951 | 550,946 | 41.5 | 2024 |
LVM06c | DDH | 7,026,032 | 555,959 | 40 | 2024 |
LV07 | DDH | 7,025,296 | 552,561 | 650 | 2024 |
LV11 | DDH | 7,024,793 | 555,582 | 412.8 | 2024 |
*LV03 was drilled as an angled borehole with an azimuth of 120 degrees and dip of 60 degrees.
Figure 8: Drilling at LV07 in 1H 2024
Brine Sampling Collection and Analysis
Various methods were used to obtain brine samples during and after the exploration drilling program:
- Packer sampling
- Airlift sampling
- Double-valved disposable bailer sampling
- Double-valved electric bailer sampling
- Hydra-sleeve sampling
- Brine sampling during pumping tests
The brine sampling program included standard quality assurance/quality control (QA/QC) elements such as including duplicate brine and blank samples in bine sample batches sent to the laboratory. Formal traffic reports and chain of custody documents were prepared for every sample obtained and submitted for laboratory analysis. In the opinion of the Competent Person (CP), sample preparation, security, and analytical procedures were acceptable for this stage of the Project and results from the laboratory analyses are considered adequate.
Drill Core Sampling and Specific Yield Estimation
During the first campaign, core samples were obtained every 10 metres from the four drillholes and a total of 122 core samples were obtained at each drillhole and submitted to the DBS&A Laboratory in New Mexico, USA for Relative Brine Release Capacity (RBRC) tests. During the second campaign (2024), 33 core samples were obtained from LV07 and LV11 and were sent to GeoSystem Analysis (GSA) laboratory in Tucson, USA, for analysis.
Figure 9: Example of Drill Core from Exploration Borehole LV11 (132 to 136m)
Laboratory values for drainable porosity were obtained from 145 successfully analysed core samples. Core samples underwent Relative Brine Release Capacity (RBRC) tests. The drainable porosity (i.e., specific yield) measurement procedure involved saturating the core sample with a brine solution and placing them in test cells where a pressure differential was applied and the proportion of brine which can be drained was estimated. In the opinion of the CP, sample preparation, security, and analytical procedures were acceptable and results from the laboratory analyses are considered adequate for resource estimation. The 2023 resource estimate included drainable porosity measurements which were increased by a secondary porosity term calculated from rock quality designation logged during drilling. This current resource update uses drainable porosity measurements from the laboratory, without modification, which results in lower drainable porosities than used in the 2023 resource estimate.
The average drainable porosity values assigned to each hydrogeologic unit used to estimate the lithium resource are given in Table 3. Due to its smaller dataset, a simpler analysis was undertaken for drainable porosity to assign representative values by hydrogeological unit; constant (average) values were assigned to each hydrogeologic unit in the resource model, and drainable porosity values were not interpolated.
Table 3: Assigned Drainable Porosity Values for Laguna Verde Hydrogeological Units
Hydrogeological Unit | Average Drainable Porosity* | N° Samples |
Unconsolidated Tuff and Coarse Tuff | 6% | 102 |
Consolidated Ash Tuff | 3% | 14 |
Brecciated and Fractured Rock | 5% | 9 |
Lower Volcanic Rock | 1% | 5 |
Upper Alluvium and Colluvium | 10%** | 0 |
Surficial Volcanic Deposits | 3%*** | 0 |
* Rounded arithmetic average
** Assumed theoretical value
*** The drainable porosity of the consolidated ash tuff unit was assumed due to its lithological similarity. The number of blocks that correspond to the consolidated ash tuff within the resource block model are negligible compared to the rest of the hydrogeological units.
Recommendations
Currently, the drilling and testing of a reinjection well is planned for the first quarter of 2025. In terms of the resource, three additional diamond drillholes in the southwest, north, and northeast are recommended to potentially expand the resource volume (Figure 2; LV08, LV09, and LV10) based on the conducted geophysics. During the drilling of those three additional diamond drillholes, depth-specific brine and drainable porosity sampling are recommended with the corresponding QA/QC measures.
Block Model Results and Verification
Figure 10 presents the shallowest interpolated concentrations of the brine body which were mapped to the Leapfrog block model; as can be seen, grades are highest in the western portion of Laguna Verde, whereas the eastern portion represents a zone of heightened recharge with diluted grades. The bottom of the block model was limited to the deepest well (LV07), and the horizontal extent of the block model was limited to the CleanTech concessions and potential of the proposed CEOL area. Laboratory results for lithium concentrations from depth specific brine and pumping test samples collected from the wells were incorporated directly into the model. Ordinary Kriging was used for the interpolation of lithium concentrations within the block model.
Figure 10: Shallow Lithium Concentration Distribution and Proposed CEOL Outline
The resource block model was subsequently validated by visual inspection and comparison of the measured and block model concentrations. Swath plots were also utilized, which compare the average measured and interpolated values along distinct profiles of the block model.
Competent Persons Statement
The following professionals act as competent persons, as defined in the AIM Note for Mining, Oil and Gas Companies (June 2009) and JORC Code (2012):
Mr. Michael Rosko is a Registered Member of the Society for Mining, Metallurgy and Exploration, member #4064687. He graduated from the University of Illinois with a bachelor's degree in geosciences in 1983, and from the University of Arizona with a master's degree in geosciences in 1986. Mr. Rosko is a registered professional geologist in the states of Arizona (#25065), California (#5236), and Texas (#6359). Mr. Rosko has practiced his profession for 38 years and has been directly involved in design of numerous exploration and production well programs in salar basins in support of lithium exploration, and estimation of the lithium resources and reserves for many other lithium projects in Argentina and Chile.
Mr. Brandon Schneider is employed as a Senior Hydrogeologist at M&A. He graduated from California Lutheran University in 2011 with a Bachelor of Science degree in Geology (with Honors) and obtained a Master of Science in Geological Sciences (Hydrogeology focus) from the University of Notre Dame in 2013. He is a professional in the discipline of Hydrogeology and a Registered Professional Geologist in Arizona (#61267) and SME Registered Member (#4306449). He has practiced his profession continuously since 2013. His relevant experience includes: (i) from 2013 to 2016, consulting hydrogeologist specializing in hydrogeological characterizations, aquifer test analyses, groundwater modeling, and pumping well optimization for mining projects and sedimentary basins in Arizona, United States; (ii) since 2017, consulting hydrogeologist in Chile specializing in lithium brine projects in Argentina and Chile with experience in brine exploration, lithium brine resource and reserve estimates, resource and reserve reporting, variable density flow and transport modeling, and optimization of pumping.
For further information contact: | |
CleanTech Lithium PLC | |
Steve Kesler/Gordon Stein/Nick Baxter | Jersey office: +44 (0) 1534 668 321 Chile office: +56 9 312 00081 |
Or via Celicourt | |
Celicourt Communications Felicity Winkles/Philip Dennis/Ali AlQahtani | +44 (0) 20 7770 6424 |
Beaumont Cornish Limited (Nominated Adviser) Roland Cornish/Asia Szusciak | +44 (0) 20 7628 3396 |
Fox-Davies Capital Limited (Joint Broker) Daniel Fox-Davies | +44 (0) 20 3884 8450 |
Canaccord Genuity (Joint Broker) James Asensio | +44 (0) 20 7523 4680 |
Beaumont Cornish Limited ("Beaumont Cornish") is the Company's Nominated Adviser and is authorised and regulated by the FCA. Beaumont Cornish's responsibilities as the Company's Nominated Adviser, including a responsibility to advise and guide the Company on its responsibilities under the AIM Rules for Companies and AIM Rules for Nominated Advisers, are owed solely to the London Stock Exchange. Beaumont Cornish is not acting for and will not be responsible to any other persons for providing protections afforded to customers of Beaumont Cornish nor for advising them in relation to the proposed arrangements described in this announcement or any matter referred to in it.
Notes
CleanTech Lithium (AIM:CTL, Frankfurt:T2N, OTCQX:CTLHF) is an exploration and development company advancing lithium projects in Chile for the clean energy transition. Committed to net-zero, CleanTech Lithium's mission is to become a new supplier of battery grade lithium using Direct Lithium Extraction technology powered by renewable energy.
CleanTech Lithium has two key lithium projects in Chile, Laguna Verde and Viento Andino, and exploration stage projects in Llamara and Arenas Blancas (Salar de Atacama), located in the lithium triangle, a leading centre for battery grade lithium production. The two most advanced projects: Laguna Verde and Viento Andino are situated within basins controlled by the Company, which affords significant potential development and operational advantages. All four projects have good access to existing infrastructure.
CleanTech Lithium is committed to utilising Direct Lithium Extraction with reinjection of spent brine resulting in no aquifer depletion. Direct Lithium Extraction is a transformative technology which removes lithium from brine with higher recoveries, short development lead times and no extensive evaporation pond construction. www.ctlithium.com
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Lithium Discovery Extended with Exceptional 86.9-Metre Intercept at Red Mountain, USA
- 86.9m @ 1,470ppm Li / 0.78% Lithium Carbonate Equivalent1 (LCE) from 18.3m, including an internal high-grade zone grading 32.1m @ 2,050ppm Li / 1.09% LCE from 46.2m
Key Highlights
- Strong lithium mineralisation returned in assays for drill- hole RMDD002, which intersected:
- 86.9m @ 1,470ppm Li from 18.3m, including 32.1m of high-grade mineralisation @ 2,050ppm Li from 46.2m.
- RMDD002 marks the thickest intercept recorded to date at Red Mountain.
- Mineralisation successfully extended 375m north of previous northernmost intersections in holes RMRC002 & 003.
- Lithium mineralisation remains open down-dip to the east and along strike to the north.
- Outstanding results strenghten the foundation for a maiden Mineral Resource Estimate in 2025.
The identification of thick, lithium mineralisation in the northernmost drill-hole at Red Mountain highlights the immense scale of the project, with strong lithium mineralisation now intersected in all drill-holes now spanning a north-south strike extent of over 5km and surface sample geochemistry indicating further potential to the north, south and west of the current drilled extents7, 9 (Figure 4).
Of particular significance in hole RMDD002 is the presence of an internal 32.1m zone of very high-grade lithium mineralisation averaging 2,050ppm Li. The identification of substantially higher-grade lithium mineralisation in this hole, as well as that in the previously announced diamond drill hole RMDD001, indicates strong potential for further high-grade zones to be discovered at Red Mountain.
With all results for the recent diamond drilling now received, the Company is finalising geological mapping ahead of planning and permitting for the next round of drilling at the Project, which will be conducted at the earliest opportunity in the 2025 field season.
Astute Chairman, Tony Leibowitz, said:
“Like all great discoveries, Red Mountain continues to grow and improve the more we drill. The manifest scale and high tenor of mineralisation are testament to Red Mountain being one of the most important recent US lithium discoveries. This drill hole is the latest in a succession of thirteen, all of which intersected strong lithium mineralisation, establishing a solid foundation for a maiden mineral resource estimate to be advanced rapidly in 2025.”
Background
Located in central-eastern Nevada (Figure 5), the Red Mountain Project was staked by Astute in August 2023.
The Project area has broad mapped tertiary lacustrine (lake) sedimentary rocks known locally as the Horse Camp Formation2. Elsewhere in the state of Nevada, equivalent rocks host large lithium deposits (see Figure 5) such as Lithium Americas’ (NYSE: LAC) 62.1Mt LCE Thacker Pass Project3, American Battery Technology Corporation’s (OTCMKTS: ABML) 15.8Mt LCE Tonopah Flats deposit4 and American Lithium (TSX.V: LI) 9.79Mt LCE TLC Lithium Project5.
Astute has completed substantial surface sampling campaigns at Red Mountain, which indicate widespread lithium anomalism in soils and confirmed lithium mineralisation in bedrock with some exceptional grades of up to 4,150ppm Li2,8 (Figure 4).
The Company’s maiden drill campaign at Red Mountain comprised 11 RC drill holes for 1,518m over a 4.6km strike length. This campaign was highly successful with strong lithium mineralisation intersected in every hole drilled9. Two diamond drill holes have been drilled at the project.
Scoping leachability testwork on mineralised material from Red Mountain indicates high leachability of lithium of up to 98%, varying with temperature, acid strength and leaching duration10.
Other attractive Project characteristics include the presence of outcropping claystone host-rocks and close proximity to infrastructure, including the Project being immediately adjacent to the Grand Army of the Republic Highway (Route 6), which links the regional mining towns of Ely and Tonopah.
Results
Hole RMDD002 successfully intersected an 86.9m thick zone of lithium mineralised clay-bearing mudstone, sandstone, tuff and limestone, from 18.3m to 105.2m down-hole. The best grades were developed in the most clay-rich zones, which exhibit a desiccated and cracked appearance in drill core once dry (Figure 2). An internal very high-grade zone of 32.1m graded 2,050ppm Li, with a maximum single sample grade of 3,850ppm Li from 59.4-61.5m (195-201.7ft), which is the drill sample with the highest lithium grade achieved to date at the project.
Figure 1. RMDD002 interpretative cross section, lithium geochemistry and (50-110m off-section) rock chip samples
Interpretation
The two northernmost holes drilled as part of the maiden Red Mountain RC drilling campaign, RMRC002 and RMRC003, intersected thin zones of near-surface lithium mineralisation. It was interpreted at the time that these two holes ‘clipped’ the edge of a zone of lithium bearing clay-rich rocks that was likely to thicken towards the east (see ‘open’ arrow in Figure 3)9. RMDD002 was designed to test this interpretation and, in addition, extend the mineralisation 375m further north beneath an extrapolated zone of strong rock chip sample results (Figure 1).
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