Pan Asia Metals

September 2023 Quarterly Activities Report

Battery and critical metals explorer and developer Pan Asia Metals Limited (ASX: PAM) (‘PAM’ or ‘the Company’) is pleased to provide this Quarterly Activities Report, summarising activities for the Quarter ending 30 September 2023 (Quarter).


HIGHLIGHTS

  • PAM set the foundations for near term cash flow in SE Asia with the IRPC MOU and long term growth in Chile by securing the Tama Atacama Lithium Project.
  • MOU with Thai listed IRPC Public Company Limited (“IRPC”, SET: IRPC), the US$1.4B integrated petrochemical and refinery flagship of PTT Public Company Limited (“PTT”, SET: PTT), itself a US$30B energy group, 51% held by the Thai Govt. The MOU will evaluate mining in southern Thailand to produce Li2O concentrates, conversion to LCE in IRPC’s chemical precinct in Rayong, and to consider Cathode Active Material (CAM) manufacturing opportunities at a later date.
  • PAM secured the Tama Atacama Lithium Project, comprising binding MOUs to acquire a suite of highly prospective lithium (Li) brine and clay projects in northern Chile extending over 290km north to south and covering ~ 1600km2. The Project area contains significant lithium values and by-product/pathfinders for both Li in Brine in the northern prospects and Li in Clay in the southern prospects. A total 57 of 185 surface samples, primarily from the Pink Li in brine prospect, averaged 702ppm Li and ranged up to 2200ppm Li based on a 250ppm Li cutoff.
  • PAM increased its Tama Atacama application area by 200km2 at the Pink Prospect, securing a preeminent position on a suite of salars which are highly prospective for Li in brines and which are supported by very high Li in surface samples.
  • PAM reviewed historic seismic investigations focused on the Pink Prospect, identifying a target zone of basin sediments from about 250-600m in depth.
  • PAM reviewed historic groundwater investigations focused on the Pink, Pozon and Dolores South and Dolores North Li in Brine Prospects, confirming that a saline groundwater zone underlying 1,000km2 of PAM’s Li Brine prospects, corresponds with highly elevated Li in surface salt crusts and shallow saline aquifers.
  • PAM conducted preliminary fieldwork at the Hilix Lithium Prospect, one of 7 prospects at PAM’s Tama Atacama Lithium Project in northern Chile.
  • Confirmatory Metallurgical testwork results for Reung Kiet Lithium Project show improved recoveries for concentrate derived from weathered mineralisation (71% Li2O recovery at 3.11% con grade) and reaffirmed fresh material testwork (~80% Li2O recovery at ~3.00% con grade).
  • Subsequent flotation test-work on ‘ore-sort’ products materially improved Li recoveries, with a post ore-sort feed grade of 0.92% Li2O showing recoveries of 77% - 87% and producing Li2O concentrates of 2.80% - 3.60% in PAM’s ‘Optimum Mining Scenario’ and for the Modelled Mining Scenario, producing a 3.0% Li2O concentrate with 78% Li recoveries. Testwork continues.
  • PAM announced an Exploration Target Update for Bang I Tum, increasing the Exploration Target by ~80-100% to 16-25Mt @ 0.40-0.70% Li2O. The potential quantity and grade of the Exploration Target are conceptual in nature. There has been insufficient exploration to estimate a Mineral Resource and it is uncertain if further exploration will result in the estimation of a Mineral Resource.
  • During the Quarter PAM raised A$1,265,000 (before costs) by way of a placement to new and existing sophisticated and institutional shareholders via the issue 5,060,000 fully paid ordinary shares at $0.25 per share (Shares). The Company’s Chairman and Managing Director, Paul Lock, subscribed $500,000.
Pan Asia Metals Managing Director, Paul Lock, commenting on the Quarter said: “Despite underlying negative investor sentiment for ASX resource stocks in general, the September Quarter has been an exceptional one for Pan Asia Metals. On the 31st of July, PAM announced that it had entered into an MOU with Thai listed IRPC, a cooperation agreement between the parties for the evaluation of developing linked components of the lithium-ion battery supply chain in Thailand, to produce Li2O concentrates at Reung Kiet, convert to LCE in IRPC’s chemical precinct in Rayong, and to consider Cathode Active Material (CAM) manufacturing opportunities as a stretch target. Importantly, IRPC, with a market capitalisation of ~US$1.4 billion, is ~45% held by PTT, with a market capitalisation of ~US$30 billion and 51% held by Thailand’s Ministry of Finance. PTT is one of the largest listed companies in Thailand and Southeast Asia, and has announced that it will invest ~US$2.75 billion into electrification. With PTT’s joint ventures with Contemporary Amperex Technology Co. Limited, Gotion High-tech Co Limited and Foxconn Technology Co. Limited, PAM is keeping good company. The IRPC MOU compliments PAM’s Reung Kiet Lithium Project, which is progressing very well.

PAM also announced that it had secured the Tama Atacama Lithium Project, one of the most strategically placed groupings of lithium brine prospects in South America. The project has extraordinarily high surface lithium assays, with 57 of 185 surface samples, primarily from the Pink Li in Brine Prospect, averaging 702ppm Li and up to 2200ppm Li, based on a >250ppm Li cutoff. Tama Atacama is strategically unique as it is at 800- 1100m altitude – Salar de Atacama is at ~2300m, Salar de Maricunga at ~3,300m and a large portion of the peer group is at 3500-4500m altitude. PAM will have simpler access and operations and higher evaporation rates. Further, the project has all required transport and energy infrastructure, is located 40-60km from the coast and 75km from Iquique, a coastal city with a population of 200,000, a deep water bulk and container port, and daily flights to Santiago. The project’s positioning, i.e. its altitude and coastal location, with a large portion of the project area abutting large tracts of historic and current nitrate and other mining, means that the permitting process should be simpler.

We have received questions about the relationship between PAM’s strategy in SE Asia and Tama Atacama in Chile. The strategy is coherent. First, we see our initiatives in SE Asia as our pathway to early cash flow, and the relationships PAM is building with IRPC and VinES, and in turn their relationships, place PAM well to achieve this. We see Tama Atacama as our pathway to future growth and scale, Tama Atacama has a large footprint and a lot of potential based on historic activities and the very high Li in surface assays. We have received interest from our current MOU partners as well as other parties in the Lithium supply chain – which is encouraging.

I opened this Quarter’s statement with a comment about underlying investor sentiment on the ASX. We see a mismatch with the fundamentals in the global EV market and we remain positive that the opportunity for well placed companies like PAM is great. When one looks at EV sales, one can see that growth is exponential, which ultimately translates to demand for lithium and other battery metals. It was recently reported that the crucial tipping point to mass EV adoption, which is 5% EV sales to total auto sales, had been crossed in 23 countries, that the US has just passed the 1 million EV sales/year mark, and that the 2030 EV market is expected to be a $950 billion market. Further, although there is a general view that LCE prices are low, we suggest that they are strong when one sets aside the 2022 price bubble – which many agree was unsustainable. When we remove the bubble from the price chart we see that current LCE prices are at higher levels than those achieved pre 2022. This is why at PAM, we remain robustly optimistic about the future of lithium and the future of PAM.


Click here for the full ASX Release

This article includes content from Pan Asia Metals 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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