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Lake Resources NL Expansion Strategy to Fast-track Lithium Projects Initiated
Clean lithium developer Lake Resources NL (ASX:LKE) (FRA:LK1) (OTCMKTS:LLKKF) is bringing forward a US$15 million program across its three 100-percent owned projects – Olaroz, Cauchari and Paso – for drilling and brine testing to fasttrack these projects into feasibility studies in the TARGET 100 Program.
Lake has initiated an expansion and integration strategy to fast-track its portfolio of assets in Argentina to deliver the TARGET 100 Program – being the aspirational goal to produce annually 100,000 tonnes of high purity lithium to market by 2030.
A separate exploration and testing team dedicated to rapid development across Lake’s three other brine projects in Argentina will be utilising the comprehensive data set developed during the Kachi project’s direct extraction processing test work.
The drilling program has started with the first rotary well of a 4000m 10-hole program, in the northern areas of the Olaroz leases, which cover a 30km long area on the eastern side of established lithium producers. These projects are located in Jujuy province, in the north-west of Argentina, close to the Allkem (Orocobre) Olaroz operation and the Lithium Americas – Ganfeng JV Cauchari project.
The drill wells are designed to quickly quantify brines identified, develop the aquifers, and conduct pumping tests and provide data for initial feasibility studies. Rotary wells will be followed later by diamond holes.
Brines will be sampled and tested with environmentally friendly direct lithium extraction method, similar to previous work conducted on Kachi project lithium brines.
“Direct lithium extraction, to be used on Lake’s multiple lithium projects, can deliver scalable projects faster to market and supply rapidly increasing demand”, Lake’s Managing Director, Mr Steve Promnitz, said.
Lake’s Chairman, Mr Stu Crow, said that discussions with potential partners to assist the fast-tracking of these assets into production is underway as part of Lake’s ongoing discussions with battery metals customers and Lake’s desire to become an integrated and valuable part of the global supply chains.
Mr Crow also said the four reasons in making the formal decision to expand the Kachi project has also given the company confidence to fast-track expansion and integration of Lake’s other assets in Argentina:
1. the increasing demand by prospective offtake partners for a secure supply chain of environmentally friendly high purity lithium carbonate;
2. the indicative support to fund new projects by Export Credit Agencies and the international bank panel. The UK and Canada Export Credit Agencies have already indicated a willingness to project debt finance around 70 percent of the Kachi project’s capital requirements (ASX announcement 11 Aug 2021);
3. the supportive investment policies of the Argentine Government who have announced a process to lower export taxes as part of the Strategic Plan for Mining Development;
4. the confidence of technology partner Lilac Solutions that its modular direct lithium extraction technology is scalable and cost effective.
“This, combined with increasing customer and consumer scrutiny around the environmental credentials of lithium production; and concerns about security of supply has given us the confidence to fast-track these developments,” Mr Crow said.
*To view tables and figures, please visit:
https://abnnewswire.net/lnk/13B49H0D
About Lake Resources NL:
Lake Resources NL (ASX:LKE) (OTCMKTS:LLKKF) is a clean lithium developer utilising clean, direct extraction technology for the development of sustainable, high purity lithium from its flagship Kachi Project, as well as three other lithium brine projects in Argentina. The projects are in a prime location within the Lithium Triangle, where 40% of the world’s lithium is produced at the lowest cost.
This method will enable Lake Resources to be an efficient, responsibly-sourced, environmentally friendly and cost competitive supplier of high-purity lithium, which is readily scalable, and in demand from Tier 1 electric vehicle makers and battery makers.
Source:
Lake Resources NL
Contact:
Steve Promnitz
Managing Director
T: +61-2-9188-7864
steve@lakeresources.com.au
For media queries, please contact:
Nigel Kassulke at Teneo
M: +61-407-904-874
E: Nigel.Kassulke@teneo.com
News Provided by ABN Newswire via QuoteMedia
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Lake Resources
Overview
The electric vehicle boom is unstoppable. Battery-powered cars could reach a 40 percent increase in global sales and the demand for lithium is expected to double to 1.5 million tonnes by 2027. The bullish outlook could be traced back to lithium-ion battery’s ability to charge faster and store higher power capacity in a lighter package.
Although Australia, Chile and China have long been the world’s top lithium producers for years, Argentina has now emerged at the forefront accounting for 21 percent of the world’s reserves. The country’s lithium mining pipeline consists of two that are currently operational, 13 planned and dozens under consideration.
Lake Resources (ASX: LKE,OTCQB:LLKKF) is a lithium development company focused on producing high-purity, sustainable lithium at a low cost from its four lithium brine projects in Argentina. The projects lie within one of the most sizable, wholly owned land packages amongst the largest players within the Lithium Triangle — home to 40 percent of the world's lithium supply.
Lake Resources has five lithium projects in the heart of the Lithium Triangle but is primarily advancing its wholly owned Kachi lithium project, approximately 100 kilometers south of the FMC Lithium (NYSE: LTHM) Hombre Muerto lithium brine production site.
In 2023, Lake Resources provided an update on the resource estimates in 2023. Additional drilling has upgraded and increased confidence in the resource in the central area of the salar, with measured and indicated (M&I) resources of 2.2 Mt of LCE defined, to a depth of 400 meters over 81 square kilometers. Surrounding the M&I resources are inferred resources of 3.1 Mt LCE defined over 117 square kilometers. The resource remains open to a depth of approximately 700 meters and opens laterally, where drilling is underway to better define the resource extent.
In February 2020, Lake Resources released a prefeasibility study (PFS) for its Kachi lithium project, which indicated an annual production target of approximately 25,500 tonnes of battery-grade lithium carbonate using Lilac Solutions' direct lithium extraction (DLE) technology.
The study was based on Kachi's indicated resource of 1.01 MtLCE at 290 mg/L lithium. The study projects an operating cost of US$4,178 per tonne, totalling approximately US$544 million in total capital expenses.
Lake Resources has partnered with Lilac Solutions to build a direct extraction pilot plant at the Kachi project. Lilac Solutions has developed a proprietary ion-exchange technology for the extraction of lithium from brine resources. It’s capable of achieving high recoveries, at minimal cost, with rapid processing times, all while providing numerous environmental benefits — particularly water preservation. Katchi aims to provide the world’s cleanest lithium using its unique procedure.
The modular demonstration plant, designed and built by the engineering team at Lilac Solutions, was dispatched to the Kachi Project in Argentina in March 2022, after which Lilac began operating the demonstration plant for several months to produce lithium chloride (eluate) representing 2.5 tonnes of lithium carbonate.
As of December 31, 2022, Lilac has successfully operated the demonstration plant for 1,000 consecutive hours and produced 40,000 liters of lithium chloride eluate, meeting all key testing milestones outlined in Lake Resources' agreement with Lilac. The lithium chloride eluate produced by Lilac will be converted to lithium carbonate, after which it will be independently tested for purity.
Project Kachi is on track to move from its pilot phase into commercial-scale development after Lake Resources and Lilac Solutions announced the production of 2,500 kilograms of lithium carbonate equivalents (LCE). This successful result led Lilac to increase its ownership of the Kachi Project from 10 percent to 20 percent. The 2,500 kilograms of LCEs were extracted at Kachi with 80 percent lithium recovery, 90 percent plant uptime, 1,000 times less land compared with evaporation ponds, and 10 times less water compared with conventional aluminum-based absorbents.
Lake Resources has appointed Saltworks, an independent assay laboratory based in Canada, , to produce larger samples of lithium carbonate. Lake Resources has conditional framework agreements in place with SK On and WMC Energy for offtake. The terms provide each partner with 25,000 tpa, along with a 10 percent equity stake in Lake Resources.
The Cauchari and Olaroz lithium brine projects are adjacent to one another and are surrounded by major players such as Lithium Americas (TSXV:LAC), SQM (NYSE:SQM), Ganfeng Lithium, and Advantage Lithium (TSXV:AAL). Drilling at Cauchari has so far returned values up to 540 mg/L lithium on the project. Lake Resources hopes to prove that both projects are extensions of the neighboring projects.Company Highlights
- Lake Resources has four clean lithium brine projects in stable mining jurisdictions in Argentina.
- Projects are near major lithium brine properties operated by Livent (NYSE:LTHM), Lithium Americas, SQM, Ganfeng Lithium and Advantage Lithium.
- Lake Resources is developing a multi-asset Tier One producer, with lithium at 99.7 percent purity that aims to provide cleaner lithium for an electric world.
- Kachi property has a mineral resource estimate of 2.2 million tonnes (Mt) of contained lithium carbonate equivalent (LCE) with 3.1 million tonnes inferred resource.
- Partnership in place with Lilac Solutions for direct brine extraction which entitles Lilac to earn up to 25 percent equity in the Kachi Project upon the completion of performance milestones.
- Working with Saltworks to produce large samples of its battery-quality lithium carbonate.
- Cauchari and Olaroz are structured as strategic extensions of neighboring resources.
- Lilac increased its ownership of the Kachi Project from 10 percent to 20 percent after producing 2,500 kilograms of lithium carbonate equivalents (LCE) at Project Kachi.
Key Projects
Kachi Lithium Brine Project
Lake Resources' wholly owned Kachi lithium brine project encompasses 36 mining leases that cover 69,000 hectares in Catamarca province, Argentina. The property is approximately 100 kilometers south of the Livent (NYSE:LTHM) Hombre Muerto lithium brine production site. The Kachi property also covers a 20-kilometer by 15-kilometer salt lake.
In November 2018, Lake Resources released its maiden resource for the Kachi project. The report outlined a resource estimate of 4.4 million tonnes of contained lithium carbonate equivalent. The report included an indicated resource of 1 million tonnes of lithium carbonate equivalent and an inferred resource of 3.4 million tonnes lithium carbonate equivalent. In 2023, Lake Resources released an upgraded and increased confidence in the resource in the central area of the salar, with measured and indicated (M&I) resources of 2.2 Mt of LCE defined, to a depth of 400 meters over 81 square kilometers. Surrounding the M&I resources are inferred resources of 3.1 Mt LCE defined over 117 square kilometers.
Direct extraction Demonstration plant
Lake Resources partnered with Lilac Solutions to further the development of the Kachi project. Lilac Solutions has developed a proprietary ion-exchange technology for the extraction of lithium from brine resources.
The technology can achieve high recoveries with minimal costs and has rapid processing times when compared to using evaporation ponds. It also provides numerous environmental benefits as it eliminates the need for evaporation ponds and decreases the footprint of the operation. The technology also allows for the remaining brine to be re-injected into the aquifer.
Lilac has successfully operated the demonstration plant for 1,000 consecutive hours and produced 40,000 liters of lithium chloride eluate, which was then shipped to Saltworks to be converted to lithium carbonate. The lithium carbonate will then be independently tested for purity.
Pre-feasibility Study
In May 2020 Lake Resources released a PFS on the Kachi property with a target of producing 25,500 tonnes of battery-grade lithium carbonate equivalent (LCE), using Lilac's direct extraction technology at an operating cost of US$4,178 per tonne. The study was based on an indicated resource of 1.01 million tonnes LCE at 290 mg/L lithium. Lake is currently working towards a definitive feasibility study on the Kachi property.
Upcoming Milestones:
Lilac’s ion exchange is proven through extensive testing at the demonstration plant, allowing faster-to-market, high-recovery solutions that are environmentally sustainable. The company expects to report in the next several weeks on the test results of the 40,000 liters of lithium chloride that were shipped to Saltworks for conversion to lithium carbonate, and then further tested for purity levels.
Additionally, the company expects to provide an operational update on the Kachi Project in the second quarter. Completion of the DFS is expected mid-2023, followed by the completion and submission of the Environmental Impact Assessment by the fourth quarter of 2023.
Cauchari-Olaroz-Paso Lithium Brine Projects
The wholly owned Cauchari, Olaroz and Paso lithium brine projects are adjacent to one another and surrounded by significant players in Jujuy province in Argentina. The projects are adjacent to Orocobre's Olaroz lithium brine operations and projects under development by Lithium Americas (ICX:LAC), SQM (NYSE:SQM), Ganfeng Lithium and Advantage Lithium.Exploration
Lake Resources began drilling on the Cauchari project in April 2019. The company encountered conductive lithium brines with values up to 480 mg/L of lithium at depths of approximately 186 meters at Cauchari. The results compared favorably with the results from nearby pre-production areas that are currently under development.
The 290-square-kilometer Paso lithium brine project is a wholly owned project in the Jujuy Province in Argentina. The province is adjacent to the border of Chile and is immediately west of Orocobre's Olaroz lithium brine operations. Lake Resources' initial sampling program returned elevated results.
At the current time, Lake is intently focused on progressing its Kachi project, however, drilling will resume at both the Olaroz and Paso projects. The drill wells are designed as part of an accelerated program across all projects in the area to quantify brines identified, develop aquifers, and conduct pump tests with data for initial feasibility studies. Rotary wells will be followed by diamond holes. Brines will be sampled and tested with direct lithium extraction methods, similar to previous work conducted on Kachi project lithium brines.Management Team
David Dickson - CEO and Managing Director
With more than 30 years' experience in process technology, engineering, construction, and engineering, procurement and construction (EPC) cost management across the energy sector, David Dickson has a proven track record in successfully delivering multibillion dollar resource projects. He is currently a senior advisor to private equity firm Quantum Energy Partners, a global provider of private capital to the responsibly sourced energy and energy transition and decarbonization sectors, and an executive strategic advisor at investment firm The Chatterjee Group. He is the former CEO of global engineering and construction firm McDermott International, where, through his seven-year tenure he built a strong leadership team that steered the company into profitable new markets, oversaw McDermott's merger with CB&I, and ultimately grew the business to more than 30,000 employees across 54 international markets.
Prior to McDermott, Dickson was previously president of Technip USA, overseeing marketing and operations in North, Central and South America. He was also appointed to the board of the US National Safety Council and a member of the World Hydrogen Council.
Stuart Crow - Non-executive Chairman
Stuart Crow has global experience in financial services, corporate finance, investor relations, international markets, salary packaging, and stockbroking. He is passionate about assisting emerging and listed companies in attracting investors and capital. Crow has gained significant experience by owning and operating his own businesses.
Dr. Robert Trzebski - Non-executive Director
Dr. Robert Trzebski is currently chief operating officer of Austmine and holds a degree in geology, a master’s degree in project management, a PhD in geophysics, and has more than 30 years of professional experience in project management and mining services. He holds considerable operating and commercial experience in Argentina and Chile, as a non-executive director of Austral Gold since 2007, listed on the ASX and TSXV. He is chairman of the audit and risk committee at Austral Gold. His role with Austmine has allowed him to develop considerable contacts across the operating and technology space of the global resources industry. Trzebski is also a fellow of the Australian Institute of Mining and Metallurgy and is also fluent in Spanish, German and English.
Amalia Sáenz - Vice-president, Argentina Corporate Affairs
Amalia Sáenz was appointed a non-executive director in July 2021. An experienced energy and natural resources lawyer based in Buenos Aires, Sáenz is assisting Lake Resources and its local team in Argentina to engage with local stakeholders and prepare for the development of clean lithium in Argentina. She is a partner at the law firm, Zang, Bergel & Viñes in Buenos Aires, where she leads the firm’s energy and natural resources practice. A leading member of the Association of International Petroleum Negotiators, Sáenz has extensive experience in energy and resources, including mergers and acquisitions, financing, joint ventures and operating agreements in Argentina. She has also worked in Central Asia and the United Kingdom, gaining experience in exploration and production development across international borders and cultures.
Karen Greene – Senior Vice President of Investor Relations and Communications
Karen Greene is an accomplished investor relations executive with over 25 years’ experience in leading US companies.
Her investor relations leadership experience includes senior vice-president, global client experience and corporate communications, member of senior leadership team at Q4 Inc, Toronto; managing director, investor relations at Hamilton Lane Corp and managing director of investor relations and communications at Actua Corporation in the US.
Greene has an MBA, Boston University and Temple University, Dean’s List; and BA Political Science, Dean’s List, University of Rochester and the Universite de Sorbonne, Paris, France.
Scott Munro - Senior Vice-president, Technology, Strategy and Risk
Scott Munro has significant experience and skills in strategic partnerships, corporate strategic planning, and technology development. He has experience in creating new business units and growing them rapidly to deliver large-scale industrial developments. Munro has overseen the successful delivery of large-scale industrial projects in international markets and has broad experience including general management, strategic planning, partnership development and overseeing technology development. His prior roles included corporate development officer at McDermott International with responsibility for Strategy Development following a period as business unit leader for the company's Americas, Europe, and Africa (AEA) Business Unit and overseeing its re-entry into these geographical areas.
Peter Neilsen - Chief Financial Officer
Peter Neilsen is a chartered accountant with more than 20 years’ experience in all facets of financial management, asset management, and leadership. He has served in a range of positions including as CFO, company secretary, finance manager, and other senior executive positions for a number of listed and unlisted companies in the energy and natural resources sector. Among the companies Neilson has worked with are Barrick, Xstrata and Round Oak. He has been involved in reducing operating expenses up to AU$100M through cost analysis, performance improvements and contract negotiations, acquisitions of up to $80M and managed revenues in excess of AU$5 billion.
John Freeman - Chief Legal Officer and General Counsel
John Freeman is a highly accomplished legal executive with over 30 years of experience in leading global companies. His extensive leadership experience includes serving as chief legal officer, executive vice-president and corporate secretary for McDermott International; general counsel and executive vice-president for Technip S.A.; global ethics and compliance director for Baker Hughes, in addition to other legal and compliance positions within that organization. Freeman has also served as prosecuting attorney for the US Office of Special Counsel and special assistant US attorney for the District of Columbia.
Gentry Brann - Chief People and Administration Officer
Gentry Brann has over 25 years of experience leading HR and communications functions. She joins Lake from McDermott, where she led the company's strategic focus on inclusion and diversity, as well as human resources, communications and marketing, real estate and facilities, and global travel. Brann joined McDermott from CB&I in 2018, where she served as senior vice-president of communications and brand management. Prior to CB&I's acquisition of The Shaw Group, she served as vice-president of investor relations and corporate communications for Shaw. Brann holds an MBA from Duke University's Fuqua School of Business and a bachelor's degree from Louisiana State University. She is also a graduate of the Advanced Leadership Program at Rice University's Jones School of Business.
Mark Anning - Head of Legal, Australia, and Company Secretary
Mark Anning has practiced at partner level in private practice, and in-house at CEO and chair direct-report levels for several ASX and NASDAQ listed companies. With 30 years of legal and corporate practice experience, Anning has specialized in corporate and commercial law, dispute resolution, risk management and corporate governance. Anning is a chartered secretary and holds a Bachelor of Commerce and LLB (Hons) from the University of Queensland and a graduate diploma in applied corporate governance. He is a fellow of the Governance Institute of Australia and is admitted to practice in all Commonwealth Courts and the Supreme Courts of Queensland and Victoria.
Sean Miller - Corporate Development Officer
Sean Miller has significant experience and skills in project execution, supply chains, contracts and procurement, and project optimisation. He has overseen the successful delivery of multibillion dollar projects in Australia and in international markets. He has broad experience including general management, strategic planning, supply chain, finance, legal, information technology, sustainable development and human resources in both greenfield projects and brownfield sites. His prior roles include being head of commercial operations for The Carmichael Rail Project in Queensland; commercial development director at the Kamoto Copper Company Copper and Cobalt mine in Katanga province of the Democratic Republic of Congo; manager - contracts & procurement for Glencore's North Queensland Metals; and superintendent metal handling at Rio Tinto's Boyne Smelters Ltd.
Howard Atkins - Non-executive Director
Howard Atkins brings deep financial management, capital markets, transaction, foreign exchange, and public company experience to the Lake Resources Board. He has over 30 years of financial leadership experience, including 20 years serving as a CFO for organizations including Wells Fargo, New York Life Insurance Company, and Midlantic Bank Corporation. Atkins previously held senior roles at Chase Manhattan Bank, including as head of Foreign Exchange and Markets Businesses for Europe, the Middle East and Africa, and head of the bank's worldwide interest rate derivatives trading business. He has served on the boards of Occidental Petroleum and Ingram Micro.
Dr. Cheemin Bo-Linn - Non-executive Director
Dr. Cheemin Bo-Linn is an accomplished CEO, former Fortune 100 operations executive, and board director with over 25 years of governance expertise at private organizations and public companies across the Americas and Europe. Her board leadership experience at public companies includes her appointment as lead independent director, chair of every major committee (audit, compensation, nomination/governance), chair of sustainability/ESG, and chair of the technology and cybersecurity committees. Her related current board service includes Flux Power, a leading developer and manufacturer of advanced sustainable lithium-ion energy storage solutions for industrial mobility fleets.
Ana Gomez Chapman - Non-executive Director
Ana Gomez Chapman is a financial services executive and board director with over 25 years of investment management, capital markets and business leadership experience. She has worked and lived across the US, Europe, Latin America and Asia Pacific. Chapman previously served on the board of directors of MP Materials, a US-based sustainable rare earth production and refining company where she steered the company through an operational turn-around that led to a New York Stock Exchange listing. She has also served on the advisory board of investment software company Backstop Solutions Group. She is a capital markets expert who has held senior roles at institutional investment firms including Hamilton Lane, where she currently serves as a managing director. She previously was senior relationship manager and alternatives lead at Allianz Global Investors, president of JHL Capital Group LLC, and vice-president at Goldman Sachs in their Latin American, Asian and US equities businesses.
Acquisition of Laguna Verde Licences
CleanTech Lithium PLC (AIM:CTL, Frankfurt:T2N, OTCQX:CTLHF), an exploration and development company advancing lithium projects in Chile, is pleased to announce it has completed the planned acquisition of the 23 Laguna Verde licences (the "Licences") previously subject to an option agreement resulting in the Company now having full ownership, as well as control, of the full 108 mining licences comprising the Laguna Verde project.
The decision to take full ownership of the Licences, details of which were contained in the Company's AIM Admission Document dated 11 March 2022, in the Directors' opinion, enhances the potential future returns to shareholders, while reducing risk, given the asset's now relatively advanced stage. The Company has also been advised that taking full ownership of the Licenses clears the path for the planned dual-listing on the Australian Securities Exchange ("ASX").
The Company has also issued convertible loan notes ("CLNS") to raise gross proceeds of £1 million for the Company on what the Directors believe are advantageous terms. Further details of the CLNs are set out below.
Highlights:
- CTL enters into a sale and purchase agreement ("SPA"), now taking full ownership of Licences that were previously held by way of an option agreement
- The SPA caps payments to the vendors of the Licences ("Vendors"), enhancing potential future returns to CTL shareholders and reduces the potentially unlimited shareholder dilution risk under the previous option terms
- CTL has been advised that taking full ownership of the Licences, under the SPA, clears the path for the ASX listing
- Staged payments to the Vendors under the SPA will be budgeted in the normal course of business over a period of up to 10 years, with the first payment having been funded through an un-secured, three-year £1m convertible loan notes on attractive terms
- The later contingent staged payments will be funded either as a very small part (~1%) of the construction finance for Laguna Verde or from sales revenues after sales of 10,000 tonnes and 35,000 tonnes of lithium carbonate equivalent (LCE) have been achieved from Laguna Verde production (estimated at approximately 2-3% of revenues from those sales volumes)
- The new commercial arrangements for the Licences provide clarity on the timing and amounts payable for the Licences and no longer include a subjective mechanism for calculating the amounts due to the Vendors or involve any payments in CTL ordinary shares.
- With CTL now owning 100% of all the 108 licences covering the Laguna Verde Project, this will support CTL's CEOL applications and further clear the path to production.
Steve Kesler, Chairman and Interim Chief Executive Officer, CleanTech Lithium PLC, said:
"Acquiring the 23 Laguna Verde licences under new commercial arrangements, so the Company has full ownership as well as control, is a prudent decision, which will support potential long-term returns to investors. The Company has also been advised that gaining full ownership of the licences will clear the path for the dual-listing on the ASX. While the timing of this decision has been driven by the ASX listing requirements, it was always planned to make these changes for commercial reasons and to provide our shareholders and potential strategic parties with clarity on the ownership position and amounts payable over time. The Board is pleased to have reached agreement with the Vendors on this matter and thanks them for their flexibility over the course of the past few months.
"Having been offered attractive terms by a third party to fund the first staged payment through a convertible loan facility, the Board felt it was prudent to take up this offer, allowing us to continue to focus our existing resources on our ongoing and planned work programmes. We are grateful to the new convertible loan note holder who has demonstrated real confidence in our plans.
"I would also like to recognise and thank our previous CEO, Aldo Boitano, for his crucial role in bringing both these agreements to a successful conclusion.
"Now that these changes have been made, we will look to dual-list on the ASX, with the relevant documentation on this now being under way. We will update our shareholders on this in due course when the application has been made."
Summary:
The original option agreement, entered into with the Vendors of the Licences in April 2021, gave CTL the exclusive right to acquire 100% of the Licences within a 5-year period. As detailed in the Company's AIM Admission Document dated 11 March 2022, this agreement also gave the Company complete control of the Laguna Verde project area as it owned and controlled all other licences comprising the project.
The option agreement that was established is a standard commercial structure within the mining industry and, given the Vendors already owned the 23 licences at that time, it represented an effective mechanism for the Company to gain full control of the Laguna Verde asset in 2021.
The option agreement fully complies with Chilean law and is in-line with UK listing requirements. CTL was, however, advised by the ASX authorities that such an agreement does not conform to current ASX listing rules as it does not provide ownership of at least 51% of all licences on a company's "flagship assets". The timing of this change from an option agreement to a mining licence SPA is being driven by the need to comply with ASX listing rules.
The Board has consistently believed, however, that it would be advantageous to replace the option agreement with full ownership prior to seeking strategic investors and construction finance for Laguna Verde. As such, the timing of this change is not materially different to that planned.
The Board believes this change is in the best interests of the Company and its shareholders as it represents an effective transfer of potential long-term value to shareholders at a time that minimises risk, given the progress made at Laguna Verde and the now evident potential value of that asset as detailed in the Scoping Study released in January 2023.
Under the option agreement, CTL was required to pay the Vendors a percentage of the commercially extractable lithium reserves value from the Licences, on or before maturity in March 2026, with determination of this value being undertaken by an independent expert. This approach reduced upfront risk during the asset's early stages of development but potentially opened the Company to a balloon payment on maturity, of which 80% was to be made in CTL ordinary shares. This represented future financial and dilution risk and negotiations in relation to reserve valuation exposed CTL to potentially protracted discussions and legal debate.
The replacement of the option agreement with the SPA provides clarity on future payments to the Vendors of Licences, capped at a total value of US$35.0 million, with staged payments as detailed below, and the two largest payments being payable out of production revenue. Under the SPA, the last contingent payment should be made within 5 years of the previous contingent payment, with all payments having been made within 10 years from the date of the execution of the SPA (i.e. by 19 April 2034). CTL has been advised it also clears the path for the ASX listing given the Company now has full ownership of the Laguna Verde licence area rather than control through an option agreement.
The initial staged payment of US$1.25m has been settled through £1m unsecured convertible loan notes, with subsequent staged payments already budgeted for as part of the Company's business plans. Based on the cashflow model, as outlined in the Laguna Verde Scoping Study, the two largest production-based payments are expected to account for between 2-3% of production revenue from those specific sales of 10,000 tonnes LCE and then 35,000 tonnes LCE.
The CLNs are on favourable terms, reflecting confidence in the Company's future returns profile, with the conversion price being the lower of a 50% premium to the 30-day Volume Weighted Average Price ("VWAP") of the ordinary shares prior to the conversion notice, or 30 pence per ordinary share. The interest rate is the Sterling Overnight Index Average rate, administered and published by the Bank of England, plus three (3) per cent. The CLN also allows the Company to focus its current cash resources on its operational and technical work programmes, rather than using them to make staged payments under the SPA.
An interview with Gordon Stein, CFO, explaining the new arrangements will be made available soon.
Background Details:
Laguna Verde is the Company's flagship and most advanced project located in Chile. The project comprises 108 licences with a JORC compliant resource of 1.8 million tonnes of LCE, with a Measured & Indicated resource of 1.1 million tonnes. The Licences subject to the SPA are carried in the Company's books in its unaudited interim statement as of 30 June 2023 at £11.0 million under "exploration and evaluation assets" representing the Company's expenditure on these assets to that date.
The Company's wholly owned subsidiary in Chile, Atacama Salt Lakes SpA ("ASL"), holds in its name 85 licences over the Laguna Verde project as well as being party to the option agreement relating to the further 23 mining licences covering the Laguna Verde Project (see details of the Option Agreement in Schedule 1).
The nature of option agreements in Chile means that the option-holder had the exclusive right to acquire 100% of the relevant mining licences within a defined period of time by making certain payments, as detailed in the option agreement, normally based on achieving certain milestones or performance criteria.
ASL has met all payments due to date on the option agreement and had until April 2026 to exercise the option and make the due payments, which would have involved a mixture of cash payments and ordinary shares in the Company at that time. Details of what those payments would have involved are outlined in Schedule 1.
The Licences under option agreement were deemed by the ASX to be a key part of the Laguna Verde Project, which it considered to be the Company's "flagship asset", hence the need for ASL to own at least 51% of the Licences at the time of the listing.
ASX confirmed to the Company's Australian lawyers in Q1 2024 that the proposed new terms under the SPA should meet the requirements of the ASX listing, to own more than 51% of all the licences at all times, and that the payment of the first instalment to the Vendors should immediately address these requirements, enabling the Company to proceed with its planned dual-listing on the ASX.
SPA summary:
- The option agreement relating to the 23 licences has been terminated and replaced with a new SPA executed on 19 April 2024 to acquire 100% of these Licences. The Licences will be held under the Company's new wholly owned subsidiary in Chile, CleanTech Laguna Verde SpA ("CLV"). CLV will only hold the Licences and not the Laguna Verde project.
- First staged payment of US$1.25 million was made to the Vendors upon execution of the SPA and a further five fixed payments will be made on a defined time basis, between 6 - 60 months after the SPA execution date, totalling a further US$9.25 million.
- Only after commencement of sales of lithium carbonate equivalent ("LCE") from Laguna Verde, two further contingent payments will become payable to the Vendors (the "Contingent Payments"): (i) US$6.5 million once sales totalling 10,000 tonnes LCE have been made and (ii) US$18 million once cumulative sales totalling 35,000 tonnes LCE have been made. At this point, these payments are expected to equate to around 2-3% of the sales values of those volumes of LCE at the time, assuming a long-term LCE sales price of around US$22,500/tonne.
- Schedule of staged payments:
Milestone | Amount (US$) | Event of Default Reversion Interest |
Fixed Payments: | ||
Upon SPA execution and transfer of the Licences to CLV - already paid | 1,250,000 | 0% |
6 months after SPA execution | 1,250,000 | 49% |
18 months after SPA execution | 1,000,000 | 49% |
30 months after SPA execution | 1,000,000 | 49% |
42 months after SPA execution | 1,000,000 | 49% |
60 months after SPA execution or within 60 days of commencing the start of construction of the plant facilities at Laguna Verde - whichever comes first | 5,000,000 | 49% |
Total Fixed Payments | 10,500,000 | |
Contingent Payments: | ||
Within 60 days of cumulative sales of 10,000 tonnes LCE from Laguna Verde having been achieved (which would be equivalent to sales revenues for ASL of US$225 million at a LCE sales price of US$22,500/tonne LCE) (1) | 6,500,000 | 40% |
Within 60 days of cumulative sales of 35,000 tonnes LCE from Laguna Verde having been achieved (which would be equivalent to sales revenues for ASL of US$787.5 million at a LCE sales price of US$22,500/tonne LCE) (1). This payment to be made no more than 5 years after the previous contingent payment and all payments must be made within 10 years of the date of the SPA. | 18,000,000 | 30% |
Total Contingent Payments | 24,500,000 | |
Total Payments | 35,000,000 |
Note (1): US$22,500 was the long-term LCE price included in the Laguna Verde Scoping Study and is still consistent with current long-term analyst price data.
- CLV will be managed and governed by Directors appointed by CTL, in-line with practices for wholly owned subsidiaries and as long as ASL continues to meet the staged payments to the Vendors on time, with no Event of Default occurring, ASL will retain 100% ownership of CLV and the Vendors will not be involved in the management or operations of CLV.
- In the event ASL should default on any staged payments, within 30 days of a default remedy period, ASL will be required to issue shares of up to 49% in CLV and establish a governance framework for CLV which comprises standardised elements for jointly operated entities including a shareholder agreement, Board of Directors, etc., which will protect the interests of the parties.
- In the Event of Default, a clawback mechanism will be in place to allow CTL to acquire back the shares without penalty by paying the default amount due including accrued interest. The shares held by the Vendors in CLV will then be acquired back by ASL.
Convertible Loan Notes ("CLNS" or "Convertible Notes"):
On 19 April 2024, the Company has issued the CLNS to a high-net-worth investor ("Noteholder") to raise gross proceeds of £1 million for the Company on what the Directors believe are advantageous terms.
Further details of the CLNS are set out below:
- The Noteholder has the right at any time to convert each Convertible Note, subject to a minimum denomination value of GBP £50,000, into ordinary shares in the Company by giving the Company 10 business day's written notice of its intention to convert ("Conversion Notice").
- The CLNS can be converted at any time into ordinary shares in the Company at the conversion price ("Conversion Price"), which is the lower of:
- a 50% premium to the 30-day Volume Weighted Average Price (as reported by Bloomberg) of the Shares ("VWAP") prior to a conversion notice; or
- £0.30 per ordinary share.
- The CLNS have a maturity date of 19 April 2027 ("Maturity Date").
- Interest will accrue daily and be calculated on the Denomination of the Convertible Notes outstanding. It will not include, and therefore not compound, any accrued interest. The interest rate is the Sterling Overnight Index Average rate, administered and published by the Bank of England, plus three (3) per cent.
- The Noteholder will have the option to have interest settled in cash on a semi-annual basis. Any interest not cash settled will be accrued and added to the balance owing to the Lender at the maturity date or at the time of any conversion.
- The Company may choose to early repay the outstanding balance of the CLNS at any time up to Maturity Date by providing at least 30 days' written notice to the Noteholder(s) ("Early Repayment Notice"). The settlement amount for early repayment will equal the amount of the CLNS outstanding, plus any accrued and unpaid interest at the date of the Early Repayment Notice, plus any interest which would have accrued on the outstanding CLNS outstanding up to the Maturity Date had the early repayment not occurred.
The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. Upon publication of this announcement, this inside information is now considered to be in the public domain. The person who arranged for the release of this announcement on behalf of the Company was Gordon Stein, Director and CFO.
For further information contact: | ||
CleanTech Lithium PLC | ||
Steve Kesler/Gordon Stein/Nick Baxter | Jersey office: +44 (0) 1534 668 321 Chile office: +562-32239222 | |
Or via Celicourt | ||
Celicourt Communications | +44 (0) 20 8434 2754 | |
Felicity Winkles/Philip Dennis | cleantech@celicourt.uk | |
Beaumont Cornish Limited (Nominated Adviser) Roland Cornish / Asia Szusciak | +44 (0) 207 628 3396 | |
Canaccord Genuity (Joint Broker) James Asensio | +44 (0) 207 523 4680 | |
Fox-Davies Capital Limited (Joint Broker) | +44 (0) 20 3884 8450 | |
Daniel Fox-Davies |
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 sustainable lithium projects in Chile for the clean energy transition. Committed to net-zero, CleanTech Lithium's mission is to produce material quantities of sustainable battery grade lithium products using Direct Lithium Extraction technology powered by renewable energy. The Company plans to be a leading supplier of 'green' lithium to the EV and battery manufacturing market.
CleanTech Lithium has two key lithium projects, Laguna Verde and Francisco Basin, and holds licences in Llamara and Salar de Atacama, located in the lithium triangle, a leading centre for battery grade lithium production. The two major projects: Laguna Verde and Francisco Basin are situated within basins controlled by the Company, which affords significant potential development and operational advantages. All four projects have direct access to existing infrastructure and renewable power.
CleanTech Lithium is committed to using renewable power for processing and reducing the environmental impact of its lithium production by utilising Direct Lithium Extraction with reinjection of spent brine. Direct Lithium Extraction is a transformative technology which removes lithium from brine, with higher recoveries than conventional processes. The method offers short development lead times with no extensive site construction or evaporation pond development so there is minimal water depletion from the aquifer. www.ctlithium.com
Acquisition of Bengal Mining - Highly Prospective Lithium Projects in Brazil’s Lithium Valley
Lightning Minerals (“L1M” or “the Company”) is excited to announce the signing of a binding agreement to acquire Bengal Mining Pty Ltd (Bengal) which holds, via its wholly owned subsidiary Tigre Mineracao Ltda (Tigre) option agreements over two lithium projects, Caraíbas and Sidrônio (the Projects) in Brazil’s prolific Lithium Valley district in the state of Minas Gerais (Proposed Acquisition).
The Company views the Proposed Acquisition as transformative for its future, leveraging the strategic proximity of the projects to Latin Resources’ (ASX: LRS) Colina project1 hosting 70.3Mt @ 1.27% Li2O and Sigma Lithium’s (NASDAQ: SGML) Grota do Cirilo project2 hosting 108.9Mt @ 1.41% Li2O. The Projects have been acquired from Bengal, a privately held Australian company which holds exclusive options across all seven (7) tenements totalling 3,372 Ha.
HIGHLIGHTS
- Projects located in the prolific Lithium Valley region of Minas Gerais 20km south of Latin Resources’ (ASX: LRS) Colina project
- Multiple pegmatites have been identified at the Caraíbas Project, with peak lithium rock chip assay results grading up to 0.53% Li2O (lepidolite)
- Significant tantalum (1,245ppm), rubidium (1,175ppm) and caesium (1,455ppm) rock chip assay results are considered positive exploration indicators
- Strong aeromagnetic geophysical trends correlate with regional mineralised trends
- Projects lie within geology of the Salinas Formation which hosts other lithium Resources in the region
- Proposed Transaction based on 5Mt, 10Mt and 20Mt Resource milestones presenting significant upside at both a project and company level demonstrating vendor confidence
- Oversubscribed placement of A$1.5M at A$0.07 per share to facilitate work program
- Field work to commence as soon as deal completion and approval at Company EGM
- Access to a seasoned field team that holds significant local IP, providing invaluable fieldwork expertise and insights
The Company is planning to begin on-ground works as soon as the Proposed Acquisition is finalised. Early-stage reconnaissance works indicate presence of lithium bearing minerals (lepidolite) with the immediate strategy to now confirm potential and then test via drilling. The Projects are subject to an exclusive option agreement that allows the Company flexibility in its exploration approach to determine the most prospective opportunities that it sees most value in based on initial work programs.
Lightning Minerals Managing Director Alex Biggs said, “This Proposed Acquisition represents a significant transaction for the Company. We believe in the lithium thematic and see now as a great opportunity to acquire highly prospective projects in known and established lithium regions. Minas Gerais in Brazil has emerged as a proven lithium hub with the acquisition located in close proximity to the world class lithium resources of Latin Resources’ (ASX: LRS) Colina project and Sigma Lithium’s (NASDAQ: SGML) Grota do Cirilo project. The Project presents some excellent early indicators of lithium mineralisation with prospective underlying geology that offers clear exploration targets. As part of the transaction we welcome new key shareholders, to the Company and look forward to the next stage of evolution of the business. It is exciting to see the Company developing and expanding our influence; we now have projects in three of the predominant lithium regions in the world: Dundas in Western Australia, Quebec in Canada and Mina Gerais in Brazil. We look forward to starting our on-ground works in Brazil and also progressing works on our other projects in Western Australia and Canada”.
About the Projects and Minas Gerais as a Lithium Region
The Projects are located in the Lithium Valley region of Minas Gerais, Brazil. The Projects cover 3,372 Ha comprising seven (7) exploration licences and are located approximately 20km south of Latin Resources’ (ASX: LRS) Colina lithium project and 60km north-west of Signa Lithium’s (NASDAQ: SGML) Grota do Cirilo project (Figure 1). The region has emerged as one of the world’s premier lithium districts over the past few years and presents significant exploration potential.
The Company will benefit from access to a seasoned ground team, providing invaluable fieldwork expertise and insights, enhancing the Company's strategic approach to exploration. Relationships the Company already has in the region will help facilitate project growth and advancement.
Minas Gerais is Brazil’s third largest economy with over 300 mines operating in the state with tier-1 operators including Vale, BHP and Rio Tinto. The state boasts a strong mining labour pool and presents a cost competitive jurisdiction for exploration and project development with mature infrastructure, hydro power and road access.
Click here for the full ASX Release
This article includes content from Lightning Minerals, 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.
Galan Lithium Limited (ASX: GLN) – Reinstatement to Quotation
Description
The suspension of trading in the securities of Galan Lithium Limited (‘GLN’) will be lifted immediately following the release by GLN of an announcement regarding an update on government permitting.
Issued by
ASX Compliance
Click here for the full ASX Release
This article includes content from Galan Lithium, 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.
Galan Signs Pivotal Commercial Agreement with Catamarca Government to Commercialise Lithium Chloride Concentrate
Galan Lithium Limited (ASX:GLN) (Galan or the Company) is very pleased to announce that on Friday 19 April 2024 (Argentina time), the Catamarca Governor signed a commercial agreement in support of the grant of permits for the commercialisation of lithium chloride concentrate from the Hombre Muerto West lithium brine project (HMW). The permits will allow for the domestic sale or export of lithium chloride concentrate, Galan will however continue to endeavour to place lithium chloride concentrate locally. Galan commits to pursuing further downstream processing routes (e.g. lithium carbonate, hydroxide or other alternatives) after 4 years, in a location outside the Hombre Muerto salar. The next step in the process is the formalisation and the passing into legislation.
Highlights:
- Galan has signed a commercial agreement with the Catamarca Government in support of the grant of permits to enable the commercialisation of lithium chloride concentrate to be sold locally or exported internationally
- Galan’s ability to export lithium chloride concentrate is expected to facilitate access to a larger customer base domestically and internationally, potentially offering enhanced offtake terms and funding/prepayment opportunities
- The agreement includes an increase in the proposed royalty rate to 7% and potential advance payments. This is similar to the successful regime operating in Australia (applied to the export of spodumene concentrate, which contributed to Australia becoming the largest Lithium exporter in the world, in recent years), thereby supporting the rapid development of the HMW project
- The agreement includes a commitment by Galan, after 4 years, to pursue further downstream processing routes (e.g. lithium carbonate, lithium hydroxide or other alternatives), outside the Hombre Muerto salar, with the intent to offer priority to a collaboration with the Catamarca government agency
- The HMW Project is a Tier One project that will produce a low cost premium high grade lithium chloride (LiCl) concentrate of 6% Li, comparable to 13% Li2O or 32% Lithium Carbonate Equivalent (LCE) and remains on track for first production in H1 2025.
- The agreement also cements an important prerequisite required for the grant of Phase 2 permits (currently under application), potentially enabling the continuity of development for Phase 2 construction at the completion of Phase 1.
- Galan continues to work closely with the local Catamarca government in relation to our long term value add lithium production strategy, this agreement further significantly de-risks the strategy and provides evidence of our very strong, positive and collaborative relationship with local authorities and our community
Catamarca Governor Raúl Jalil and Galan Lithium Ltd Managing Director Juan Pablo Vargas de la Vega in Catamarca on Friday 19 April 2024
As previously announced, the HMW project is separated into four production phases. The initial Phase 1 Definitive Feasibility Study (DFS) focused on the production of 5.4ktpa LCE of a lithium chloride concentrate (currently under construction) by H1 2025, as governed by the approved production permits. The Phase 2 DFS targets 21ktpa LCE of a lithium chloride concentrate in 2026, followed by Phase 3 production of 40ktpa LCE by 2028 and finally a Phase 4 production target of 60ktpa LCE by 2030. Phase 4 will include lithium brine sourced from both HMW and Galan’s other 100% owned project in Argentina, Candelas. The very positive Phase 2 DFS results were announced on 3 October 2023 (https://wcsecure.weblink.com.au/pdf/GLN/02720109.pdf).
Galan’s Managing Director, Juan Pablo (JP) Vargas de la Vega, commented: “Galan would firstly like to acknowledge and sincerely thank the Government of the Catamarca Province in Argentina for their continued support. We look forward to continuing to work side by side with our local communities and authorities, towards achieving mutually beneficial and sustainable outcomes for both the people of Argentina and Galan’s shareholders, through the further downstream development of lithium processing routes such as lithium carbonate, hydroxide or other alternatives, in Catamarca.
This commercial agreement is an important milestone in implementing Galan’s strategy, providing access to a larger international customer base at potentially improved sales and funding/prepayment terms. The agreement is expected to provide tangible progress towards the granting of Phase 2 permits on our journey to becoming the next lithium producer in Argentina.
Click here for the full ASX Release
This article includes content from Galan Lithium, 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.
AM Resources Completes Compilation Work with the Discovery of 94 New Pegmatites for a Total of 281 Pegmatites on its 1,500 km² Land Package in Austria
AM Resources Corporation(“AM Resources” or the “Company”) (TSXV: AMR) (Frankfurt: 76A), a dynamic junior mining company focused on the exploration and development of high-potential pegmatite lithium deposits, is pleased to announce that it has completed the compilation of government data on its newly acquired 1,500 km2 land package (see press release dated March 21, 2024) with the discovery of 94 new pegmatites. AM Resources has now identified a total of 281 pegmatites, consolidating its strategic position in one of Austria’s most prospective lithium areas.
- Recently announced 1,500 km2 land package gives AM Resources control over a large area of the Austrian Pegmatite Belt.
- Compilation of government data resulted in the discovery of 94 additional pegmatites across two groups, with sizes ranging from 40 metres to 2,100 metres.
- Many pegmatites are strategically located within mica schists, indicating favorable conditions for lithium-bearing minerals.
- Latest discoveries continue to reinforce AM Resources’ position in the Austrian Pegmatite Belt, located within proximity to European battery manufacturers.
AM Resources’ 1,500 km2 land package
First Group
The Company has identified a pegmatite corridor comprising of 88 pegmatites with lengths varying from 40 metres to 1,200 metres. A total of 38 pegmatites are located within mica schists, a geological setting favorable for the presence of lithium-bearing minerals. The other pegmatites are hosted within lenticular pegmatoid gneiss, which is less favorable to the presence of lithium-bearing minerals.
Second Group
An additional 6 pegmatites with one reaching over 2,100 metres in length were discovered. These pegmatites are located within mica schists, a geological setting favorable for the presence of lithium-bearing minerals.
David Grondin, CEO of AM Resources stated: “Through our compilation work, our technical team has identified 281 pegmatites, the longest of which exceeds 2 km in length. When we began our journey in Austria over a year ago, we were aware of the potential of the Austrian Pegmatite Belt. However these discoveries are beyond our expectations. This preliminary assessment of our new land package is extremely exciting and we look forward to a summer exploration and sampling campaign that will target each of these pegmatites.”
Location, Location, Location
As previously reported, the AM Resources team has been actively assembling a massive prospective land package with four key elements at the core of its strategy: proven geology, proximity to key markets, historical expertise, and a clear, proven mining code. AM Resources’ Austrian properties are located within 620 km of 14 planned battery plants and have direct access to an extensive rail system.
Qualified Person
Technical information related in this news release has been reviewed and verified by Jean Lafleur, P. Geo., of PJLEXPL Inc., a registered geologist with the Ordre des Géologues du Québec (OGQ #833) and is a qualified person (QP) as defined by NI 43-101. Mr. Lafleur is independent from the Company and has reviewed and approved the disclosure of the AM Resources geological information.
About AM Resources
AM Resources Corporation (TSXV: AMR) is a dynamic junior mining company focused on the exploration and development of high-potential pegmatite deposits. With a strategic portfolio of assets and a commitment to responsible resource development, the Company is dedicated to creating long-term value for its stakeholders while adhering to the highest standards of corporate governance and sustainability.
Forward-Looking Statements
This news release contains forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of AM Resources to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as “plans”, “expects”, “estimates”, “intends”, “anticipates” or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this press release. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. Readers are cautioned that the foregoing list of factors is not exhaustive. The forward-looking statements contained in this news release are made as of the date of this release and, accordingly, are subject to change after such date. AM Resources does not assume any obligation to update or revise any forward-looking statements, whether written or oral, that may be made from time to time by us or on our behalf, except as required by applicable law.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information:
David Grondin
AM Resources Corporation
President and Chief Executive Officer
1-514-583-3490
www.am-resources.ca
Piedmont Secures Mining Permit for Carolina Lithium Project
Piedmont Lithium (NASDAQ:PLL,ASX:PLL), one of North America’s leading lithium suppliers, announced on Monday (April 15) that the North Carolina Department of Environmental Quality (NCDEQ) has given its stamp of approval for the company's US$1.2 billion mining and processing plant project in Gaston County.
“This is an exciting day for all of us at Piedmont Lithium. I would like to thank the leadership and staff at NCDEQ and (the Division of Energy, Mineral and Land Resources) for their diligence in the process, as well as the members of our team who worked rigorously for more than two and a half years to ensure that every aspect of the Project met the state’s high standards for approval,” Keith Phillips, the company's president and CEO, said in a press release.
The permit allows for the construction, operation and reclamation of the proposed project, with the Belmont-based company planning to develop Carolina Lithium as a key part of the US supply chain for electric vehicles (EVs).
“We plan to develop Carolina Lithium as one of the lowest-cost, most sustainable lithium hydroxide operations in the world, and as a critical part of the American electric vehicle supply chain. The Project is expected to contribute billions of dollars of economic output and several hundred jobs to Gaston County and North Carolina’s growing electrification economy,” Phillips added, noting that he sees the asset as "a highly strategic project."
The open-pit lithium mine, which will resemble a quarry, is slated to delve as deep as 500 feet, with daily blasting routines. The company expects to recruit over 400 staff members for the commencement of operations.
Carolina Lithium is set to be a low-cost producer of spodumene concentrate and lithium hydroxide, and will benefit from favorable infrastructure, minimal transportation distances and access to local markets. It is also slated to be one of the lowest-cost and most sustainable lithium hydroxide operations globally, according to the company.
Shares of Piedmont spiked more than 35 percent on the Nasdaq after Monday's news. With the mining permit approval for Carolina Lithium now in hand, it will proceed with the county rezoning process, engaging with the local community and authorities. Construction will start upon receipt of all necessary permits, rezoning approvals and financing.
According to Reuters, this week's milestone for Piedmont comes after local opposition to Carolina Lithium, as well as a low lithium price environment. The company is also facing competition from major lithium miner Albemarle (NYSE:ALB), which is making strides toward reopening a lithium spodumene mine in a neighboring North Carolina County.
Piedmont's North American Lithium joint venture, which is focused on Québec, Canada, began production last March, receiving its first revenue from shipments in the third quarter of 2023. The company signed a supply deal for North American Lithium with EV maker Tesla (NASDAQ:TSLA) in 2020, and amended the agreement in January 2023. As it stands, Piedmont has agreed to deliver approximately 125,000 metric tons of spodumene concentrate to Tesla from H2 2023 to the end of 2025. Tesla has the option to extend the arrangement for another three years.
US pursuing EV supply chain initiatives
As the world shifts toward clean energy, the US is gearing up to play a larger role in the North American lithium supply chain, crucial for powering the EVs and electronics of the future. Traditionally reliant on imports, primarily from Chile, Argentina and Canada, the country is looking to develop its own lithium resources to bolster energy security.
Recent estimates from the US Geological Survey suggest substantial lithium potential within the country, positioning it as a key contender in meeting both domestic and global lithium demand.
Furthermore, initiatives such as the Clean Energy Minerals Reform Act, spearheaded by New Mexico Senator Martin Heinrich, aim to address regulatory challenges and ensure responsible mining practices.
Aside from that, the Biden administration is continuing its push to strengthen America's critical materials supply chain, recently announcing a large loan for Lithium Americas (TSX:LAC,NYSE:LAC) subsidiary Lithium Nevada.
Last month, the US Department of Energy’s Loan Programs Office issued a conditional commitment for a US$2.26 billion loan to support the construction of a lithium carbonate processing plant at Thacker Pass in Nevada. The loan is contingent upon the completion of environmental reviews and regulatory requirements.
The project, situated adjacent to the largest-proven lithium reserves in North America, aims to produce about 40,000 metric tons per year of battery-grade lithium carbonate for use in lithium-ion batteries.
Supported by an equity investment from General Motors (NYSE:GM), Thacker Pass could supply enough lithium carbonate to power up to 800,000 EVs annually, significantly reducing gasoline consumption.
A Bloomberg article published at the time notes that the move from the US government highlights its commitment to developing the country's EV supply chain, but also underscores potential opposition to the project.
Don't forget to follow us @INN_Resource for real-time updates!
Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.
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