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Pure Energy Minerals announced that it has signed an expanded non-binding memorandum of understanding (MOU) with Korean Steelmaker POSCO. The new document expands the scope of an MOU signed last March to include other considerations such as the development of business relationships with potential customers and “consolidation with other lithium development properties/lithium producers.”
POSCO and Pure Energy initially signed a non-binding MOU last March for the exploration of Pure Energy’s Nevada lithium claims and the development of lithium extraction and processing technologies. The new document expands the scope of the MOU to include other considerations, such as the development of business relationships with potential customers and “consolidation with other lithium development properties/lithium producers.”
The companies will aim to reach a definitive agreement within the next six months.
“We are very pleased with this expanded opportunity for collaboration on our Nevada Lithium project with POSCO,” said Pure Energy CEO Robert Mintak in a statement. “Our management team is keen to highlight our strategic U.S. brine resource and explore ways to cooperate with one of world’s leading companies in the development of lithium resources and battery materials.”
POSCO has been in the news lately for its work with Lithium Americas (TSX:LAC) at the latter’s Cauchari-Olaroz project in Argentina. The company has been working on its proprietary lithium extraction technology for years, and following positive test results from its demonstration plant at Cauchari-Olaroz, it’s now in talks with Lithium Americas to develop a commercial plant.
For his part, Lithium Americas CEO John Kanellitsas is positive on Tuesday’s announcement from Pure Energy. “[T]his is terrific news for Rob and his team,” he said. “It demonstrates POSCO’s commitment to having a wide global footprint in the lithium sector. [A]dditional lithium production is going to be required in order for the industry to supply the growing demands of the gigafactory scale projects, and we hope to see more positive announcements from junior developers.”
Analysts such as Jon Hykawy of Stormcrow Capital and Chris Berry of House Mountain Partners have said positive things about POSCO’s process, and many appear to be hoping that the process could provide a much-needed alternative to the evaporation-pond process for recovering lithium from brines. That method can take 12 to 18 months and features recovery rates of less than 50 percent, while POSCO’s process takes just eight hours to hit recovery rates of 90 percent.
That said, Hykawy has also noted that POSCO’s technology is by no means the be-all, end-all for lithium processing. Certainly, there are other players looking to advance innovative technologies for lithium extraction and processing as well.
For example, Pure Energy is also working with Israel’s Tenova Bateman to test that company’s LiP™ membrane-based process and LiSX™ solvent-extraction process. Test work conducted on raw brine from Pure Energy’s Clayton Valley project has yielded positive results, with the process producing a lithium chloride solution that’s 99.9 percent pure.
The company also has a mutual cooperation agreement with Australia-based Phoenix Water regarding that company’s patented lithium-processing technologies.
To be sure, while the Clayton Valley project is still early stage, it’s interesting to see Pure Energy looking at a number of different extraction and processing technologies for the project. At close of day on Tuesday, shares of Pure Energy Minerals had gained a penny to trade at $0.28.
Securities Disclosure: I, Teresa Matich, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Pure Energy Minerals is a client of the Investing News Network. This article is not paid-for content.
Related reading:
Innovative Technologies in the Lithium Space: Part 2
Lithium Americas in Talks to Develop Commercial Scale POSCO Plant at Cauchari-Olaroz