Arizona Lithium progressing Prairie lithium after wrapping up 2024 drilling

Arizona Lithium completes exploration drilling at Pad #3 within its Prairie project
Well can be converted into a production or disposal well for future lithium production
Each of the three completed pads targets production of 2000tpa LCE

Special Report: Arizona Lithium continues to progress its Prairie project in Saskatchewan, Canada, towards commercialisation after wrapping up exploration drilling at Pad #3.

Completion activities for the drilling, which targeted the Souris River and Dawson Bay formations, is now underway with results to be released once analysis is done.

The exploration well can be converted into a future production or disposal well.

Pad #3 will be the last of three pads detailed in a December 2023 preliminary feasibility study, each targeting 2000 tonnes per annum of lithium carbonate equivalent. Each pad also has net present value of about US$150m.

Having three pads will enable Arizona Lithium (ASX:AZL) to produce a total of 6000tpa LCE at Prairie.

Scope to expand

Once these pads are producing, the company plans to quadruple that to 12 pads to reach steady state production of 24,000tpa LCE.

“This well drilled on Pad #3 represents the finality of our successful drilling program for 2024. Flow testing will continue across our wells on Pad #2 and Pad #3 as we finish up our remaining exploration field work for 2024,” managing director Paul Lloyd said.

“Given the speed of development at the Prairie project we are confident in hitting our goal of production of lithium products in 2025, which is now the company’s primary focus.

“We are very proud of the efficiency and effectiveness of the Prairie drilling program this year. We have continued to develop the Prairie project during a difficult period in the lithium cycle.

“By spending $18.4 million dollars during the year, we have separated AZL from many other companies in the lithium industry.”

He adds that while the company remained focused on bringing Prairie into production by the end of 2025, it will also seek to ultimately bring Big Sandy in Arizona, which remains a core project, into production.

Prairie project

Prairie is well advanced, with AZL already proving it can deliver a battery grade lithium carbonate product from the lithium-rich brine sourced from its reservoirs.

The company expects to start lithium production in 2025 using direct lithium extraction technology.

Its late 2023 PFS had indicated the project would operate at costs of just US$2819/t LCE, with total capex for its first phase of US$290m and long-term pricing of US$21,000/t, a figure based on comprehensive analysis by “Mr Lithium” Joe Lowry’s consultancy Global Lithium.

This article was developed in collaboration with Arizona Lithium, 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.