Eye on Lithium: Ganfeng encourages US EV makers to take stake in its Mexican project to secure supply
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All your ASX lithium news for Tuesday, April 12.
China’s largest lithium producer Ganfeng is open to US automakers making a “strategic” investment in the Sonora lithium mine in Mexico, as they seek to create a North American supply chain for battery raw materials.
The US$420mn Sonora project is scheduled for first production next year, and Ganfeng told Benchmark Minerals Intelligence that an investment by Ford, GM or Tesla would help provide automakers with reliable supplies of lithium that can be easily shipped across the border to plants in the US.
“We are open to having strategic investors in our Mexico project, together with investment we could have an offtake agreement with them,” vice chairman Wang Xiaoshen said.
— Henry Sanderson (@hjesanderson) April 8, 2022
But Mexico’s president Andrés Manuel López Obrador has been talking nationalisation again, saying that if Congress does not approve a constitutional reform on electrical matters this week he will push for a rewrite of the country’s Mining Law.
“In the event that the members of Congress that represent vested interests prevent the reform, in that case, they will not be able to dispose of lithium. They care a lot about lithium, as they want to put their hands on this strategic mineral,” he said.
“If we were to be betrayed, we can still resort to reforming the Mining Law.”
The president pointed out that amending the Mining Law would “make lithium a mineral that belongs to the nation, to the Mexicans.”
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A total of 22 stocks were in the green today, with 28 flatlining and a whopping 64 in the red.
The company is repositioning itself as a pure-play lithium company, focusing on the McDermitt Lithium Project in Oregon, USA.
Jindalee’s Australian assets will be separated into stand-alone vehicle listed on ASX (NewCo), which will include will Jindalee’s landholding the Widgiemooltha district and the Lake Percy Project (which are both prospective for nickel, gold and lithium) together with its interest in the Prospect Ridge joint venture in Tasmania.
“The board believes that the favourable political climate in the United States following bi- partisan expressions of support for the development of an integrated domestic lithium-ion battery value chain, coupled with the well-known electric vehicle thematic, create the ideal backdrop for the proposed Demerger,” Chairman Justin Mannolini said.
The company expects to publish an updated mineral resource estimate for McDermitt in the current quarter and has planned a further drill program for the second half of the calendar year.
Jindalee shareholders will retain exposure to the WA assets via an in-specie distribution of NewCo shares.
If approved, the Demerger is expected to be completed in the September quarter of 2022.
The company has identified priority areas at the Warralong gold-lithium project in WA and is planning follow up work.
An external review of remote sensing information from Sentinel-2 spectral data shows that several anomalies coincide with the spectral responses which are typical of nearby gold and lithium deposits.
“The surface sampling results and spectral data have given us some specific areas to focus on in our extensive ground holding, much of which has never previously been mapped or sampled, and our field crew is currently on site collecting infill samples over these key areas,” MD Pip Darvall said.
MONGER GOLD (ASX:MMG)
A CSIRO UltrafineTM+ (UFF+) soil sample program will start on the 17 April at the company’s Gibraltar Project, and will continue on to Mt Monger North and South Projects.
The aim is to target extensions to favourable lithologies/structures along strike of known occurrences of pegmatite lithium-caesium-tantalum (LCT) – along with gold, nickel and copper-zinc mineralisation.
“It is worthwhile noting the potential at the Gibraltar Project for lithium-caesium-tantalum (LCT) mineralisation, particularly in the south where alluvium may have hidden strike extensions of known historic lithium and tantalum in the Londonderry Pegmatite deposits,” chairman Peretz Schapiro said.
The company expects field activities to begin next month at its Arunta Project in the Northern Territory, with sacred site clearance by the Central Land Council (CLC) now underway on the tenement, EL23816 Barrow Creek, which covers the Home of Bullion mine as well as Prospect D, which is required under the existing Native Title Deed.
“The commencement of this sacred site clearance is the key critical path item required to allow field activities in the Arunta Project to begin,” MD and CEO Wayne Rossiter said.
“COVID precautions in remote aboriginal communities and staff shortages within the CLC have impacted the clearance timetable and the Company’s ability to begin fieldwork.
“The securing of this clearance will pave the way for expansion of our Home of Bullion copper deposit drilling and lithium exploration activities.”
CRR has staked an additional 1,200Ha of land in the ‘electric avenue’ region of Ontario, Canada.
The Plaid and Whiteloon Lake Projects are in the same avenue which contains Frontier Lithium’s Spark project, and the company has already observed pegmatites across both projects.
“The region’s deposits in the locality represent some of the largest hard rock lithium deposits in North America,” MD Alex Biggs said.
“Our desktop studies have concluded similarities between the Projects and some of the deposits nearby which warrant further studies and exploration, particularly the trend of pegmatites.
“For now, we are waiting for the snow to melt, and expect to be performing work on the ground throughout the summer months.”
KZR has flagged multiple pegmatites and increased its exploration tenure to total 354.4km2 at the Marble Bar lithium project in WA.
“We now consider the likelihood for LCT pegmatite mineralisation in the immediate area is very high, which is supported by Global Lithium’s (ASX:GT1) nearby Archer deposit (10.5Mt at 1.0% Li20) to the north,” chairman and CEO Luke Reinehr said.
Plus, the company has been granted two more tenements in the area which is now subject to “extensive exploration activity” with JV partner Chilean lithium producer SQM.
The company says the Horse Rocks lithium-nickel project in WA “continues its path towards grant” with the process expected to be completed in May.
Horse Rocks comprises a 23.8km2 exploration licence, 8km west of Mineral Resources’ (ASX: MIN) Mt Marion Lithium Mine – with the same source granite and ‘Mt Marion- Style’ lithium potential.
Once tenure is granted, a comprehensive mapping and geochemical sampling program can kick off.
“With exposure to some of the best nickel, lithium and gold belts in Western Australia, the company can’t wait to get drill rigs turning and assays in the lab,” MD Barnaby Egerton-Warburton said.
The company has intersected more thick, high-grade intercepts at the Seymour project’s North Aubry deposit in Canada, including 34.3m at 1.32% Li2O from 244.0m.
GT1 says the assays indicate substantial potential upside to the existing Seymour Mineral Resource estimate of 4.8 Mt at 1.25% Li2O1 – which is on track for completion in Q2 FY22.
“Both the northern and down-dip extents of the North Aubry pegmatite are also open to further expansion, which we plan to pursue in coming months,” CEO Luke Cox said.
White Cliff has completed the acquisition of Abraxis Minerals Pty Ltd, holder of the Abraxis Lithium project in WA.
A reconnaissance field mapping and sampling program will begin shortly with the possibility to expand to the Rat Hill Lithium project.
“While the Crackerjack and McCaskill Hill drilling assay results for gold were disappointing, the recent results at Hines Hill and planned exploration at Abraxis, Yinnetharra and Diemals provides us with a clear exploration strategy across our sizeable Lithium and REE project tenure,” Technical director Ed Mead said.
In the March quarter, PLS produced 81,431 dry metric tonnes (dmt) of spodumene concentrate from its Pilgangoora project in WA.
That’s within previous guidance of 75-90,000dmt, plus the company shipped a total of 58,383dmt during the quarter, with an average realised sales price of ~US$2,650/dmt (CIF China, SC6 basis).
The company says the operation is on track to achieve FY22 annualised production guidance of 340-380,000dmt – assuming no material impact from COVID community transmission.
Construction work for the restart of the flotation circuit at the Ngungaju plant is now complete, with the load (ore) commissioning process now underway.
Following the successful commissioning of the Pilgan plant improvements project, production capacity is now re-rated from 330ktpa to 360-380ktpa of spodumene concentrate.
Plus, PLS is targeting its next BMX auction for the last week of April 2022, with 5,000dmt planned for delivery during June 2022.
Further auctions are anticipated in the near term as the ramp-up at Pilgangoora to 560 – 580,000dmt per annum of spodumene concentrate continues, resulting in more uncontracted tonnes becoming available for spot BMX sales.
Snow Lake lithium – who NVA have sold part of their stake in – has commissioned a scoping study to assess the proposed lithium hydroxide plant in South Manitoba, Canada, which would be 700km from the company’s mine and located with direct access into the North American car manufacturing market.
“Snow Lake has been a remarkable investment for us and we see the next 12 months as being an exciting and pivotal time for Snow Lake, as it delivers on its key value creating milestones of advancing and expanding its resource, completing its economic and downstream processing studies,” CEO Christopher Gerteisen said.
The scoping study will start in April 2022 and is expected to be completed by Spring 2023.
In parallel with this, Snow Lake will continue its engineering evaluation and drilling programme across its Thompson Brothers Lithium Project site, with the expectation that the mine will transition to commercial production in late 2024.