The brine will be sampled and tested with the company’s environmentally friendly lithium extraction process. Pic: RichVintage via Getty Images.
The clean and green lithium machine, Lake Resources, is expanding its projects and potential resources – with a 10 hole 4000m drilling program planned at its Olaroz, Cauchari and Paso lithium brine projects in Argentina.
The program will kick off in late January 2022, and will run parallel with DFS development at the company’s flagship Kachi Lithium Project.
Lake Resources (ASX:LKE) managing director Steve Promnitz said the company is eyeing an expanded resource base in response to accelerating lithium demand.
“Increasing demand expressed by potential offtakers for a secure supply of high quality, environmentally friendly lithium has encouraged Lake to drill and test our other 100 percent owned brine projects in Argentina, adding to our flagship Kachi Project,” Promnitz said.
A New York based senior analyst, Jake Sekelsky of Alliance Global Partners, stated that Lake Resources is “A major lithium producer in the making”. Jake used to be at Roth Capital and considers that Lake is ”well positioned to become a primary source of ESG friendly lithium supply”, while reiterating a strong buy to $1.30 per share.
The projects are in the Jujuy province, close to the Allkem (Orocobre) Olaroz operation and Lithium Americas/Ganfeng Cauchari project.
The drill program will start at the northern areas of the Olaroz leases, which cover 30km on the eastern side of established lithium producers.
A second rotary drill rig is being sourced to potentially work alongside the diamond rig to quickly quantify brines, develop the aquifers and conduct pumping tests and passive seismic geophysics which are currently underway.
Brines will be sampled and tested with environmentally friendly direct lithium extraction methods, and this will be followed by a scoping study to expand future production – with Lake planning to commence pre-feasibility study work once a resource has been defined.
The company previously drilled and confirmed multiple high-grade lithium brines zones at Cauchari, averaging 493 mg/L lithium over 343m (from 117m to 460m), up to 540 mg/L.
This confirmed similar grades and lithium brines extending into Lake’s properties from the adjoining Ganfeng/Lithium Americas JV production development.
The company anticipates similar potential from Olaroz and Paso.
The new program follows recent drilling and DFS development work at Lake’s Kachi project in support of doubling production to meet increasing demand for high-grade, battery quality lithium produced via LKE’s environmentally sustainable, direct extraction process.
The company says these additional projects make it well placed to expand output, with support from export credit agencies and international investors.
And it’s great timing, with upgrades in lithium demand forecasts and increased electric vehicle (EV) production plans by major automakers highlighting the demand for increased supply of battery-grade lithium – such as planned from the environmentally sustainable, direct lithium extraction method Lake will be using.
“Now is the perfect time to expand our resource base, with Argentina gaining increasing international investment due to the quality of its lithium resources,” Promnitz added.
“Having recently visited the project site and engaged with local stakeholders, we are keen to ramp up activity early in the new year to seize this window of opportunity for Lake.”
This article was developed in collaboration with Lake Resources Limited, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
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