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Patagonia Lithium Ltd (ASX:PL3) has reported that drilling at Cilon Well 8 (JAM 26-08) has reached a depth of 200 metres, completing six successful packer assay tests. Specific gravity readings ranged from 1.04 to 1.06 gm/cm³, indicating high total dissolved solids consistent with lithium brine exploration in Argentina's Salar de Jama. The next stage involves testing at 210 metres, with the well aiming for a final depth of 600 metres to target lithium-bearing aquifers between 250 and 400 metres.
Key Points
- Patagonia Lithium Ltd (ASX:PL3) is actively exploring lithium brine deposits in Jujuy Province, northern Argentina
- Cilon Well JAM 26-08 has reached 200 metres depth with six successful packer assay tests completed
- Specific gravity increased from 1.04 to 1.06 gm/cm³ across test intervals; flow rates peaked at 705.9 litres per hour
- Environmental assessment confirms no impact on hydrological basin balance from drilling activities
- Assay results from packer tests expected within 3 to 4 weeks after sample submission
- Investor briefing scheduled for 19 August 2026 featuring Executive Chairman Phillip Thomas
Drilling Progress and Target Zones at Cilon Well 8 in Argentina's Lithium Triangle
Patagonia Lithium's Cilon Well 8 (JAM 26-08) is part of the Formentera/Cilon project located in Salar de Jama, Jujuy Province, within Argentina's lithium triangle. Positioned at UTM coordinates 707530.68 East and 7410278.49 North (POSGAR 94), the well collar sits at 4093.7 metres above sea level. As of 21 July 2026, drilling reached 200 metres depth, with a planned final depth of 600 metres. The vertical well (dip -90°, azimuth 0°) targets primary lithium-bearing formations between 250 and 400 metres.
Executive Chairman Phillip Thomas highlighted the sixth packer test's specific gravity increase to 1.06 gm/cm³ as "extremely positive for lithium." The drilling program is guided by magnetotelluric (MT) geophysical data, shown in Figure 3 of the company update. Patagonia Lithium's Argentine exploration includes two main lithium brine projects: Formentera/Cilon (19,500 hectares in Jujuy) and Tomas III at Incahuasi Salar (580 hectares in Salta Province).
Packer Assay Test Outcomes and Aquifer Flow Analysis
Six packer tests at Cilon Well 8 extracted brine samples from specific depth intervals to evaluate aquifer properties. The initial test at 66-74 metres showed a specific gravity of 1.04 gm/cm³ with a flow rate of 480 litres per hour. The second test (108-116 metres) recorded 1.048 gm/cm³ and 307.7 litres per hour. The third test (126-137 metres) reached 1.05 gm/cm³ with the highest flow rate of 705.9 litres per hour, indicating strong aquifer productivity.
Tests four through six continued the upward trend in specific gravity: 1.052 gm/cm³ at 147-158 metres (377.3 litres/hour), 1.056 gm/cm³ at 168-179 metres (461.5 litres/hour), and 1.06 gm/cm³ at 186-200 metres (285.7 litres/hour). Electrical conductivity rose from 75.31 to 107.6 microsiemens/cm, while total dissolved solids ranged from 37.61 to 53.76 parts per thousand, aligning with lithium brine exploration targets.
Core Lithology and Mineralogy Between 189 and 200 Metres
Core samples from 189.22 to 200 metres consist mainly of unconsolidated fine brown sands transitioning to semi- and strongly consolidated sections. The sands primarily contain subrounded quartz grains, rounded lithic fragments, and minor mafic minerals. Unconsolidated sands show high visual porosity, while consolidated sections lack visible porosity and exhibit strong hydrochloric acid reaction, indicating secondary carbonate cementation filling pore spaces.
Visual mineral estimates reveal quartz at 86-88%, litharenite (rounded shales) at 1-3%, halite needle crystals at 2-3%, and lithic minerals including olivine, biotite, and pyroxenite at approximately 2-3%. Calcite ranges from 0-4%, and montmorillonite clays from 0-3%. The company notes these visual estimates are not substitutes for laboratory analyses and serve to illustrate porosity characteristics rather than definitive mineral abundance. Porosity will be further assessed using borehole magnetic resonance, gamma ray, and specialist core pressure measurement techniques.
Environmental Review and Hydrological Impact Assessment
Patagonia Lithium's environmental assessment submitted for regulatory approval concluded no environmental impact from drilling at Cilon Well 8. The hydrological balance of the basin remains unaffected by current operations. This clearance supports ongoing drilling toward the 600-metre depth target and validates compliance with Jujuy Province regulations.
The positive environmental findings enable continuation of packer testing at 210 metres and beyond. Regulatory compliance and environmental stewardship are critical for lithium exploration in sensitive aquifer regions where water resources are vital. This assessment reassures investors of responsible exploration practices alongside lithium brine development goals.
Company Capital Structure and Board Details
Patagonia Lithium has 241.1 million shares issued, alongside 29.4 million unquoted options and 25.0 million unquoted performance rights. The board is led by Executive Chairman Phillip Thomas, with non-executive directors Rick Anthon and Pablo Tarantini. Jarek Kopias serves as Co-Secretary. The company is headquartered at Suite 66, 1st Floor, 2-4 Cochranes Road, Moorabbin, Victoria 3189, with primary operations in South America.
Since its ASX listing on 31 March 2023, Patagonia Lithium has conducted surface sampling and magnetotelluric geophysical surveys across its tenements. Seven prior drill holes (JAM-24-01 through JAM 26-07) have been completed at Cilon, with JAM 26-08 representing the eighth hole. A 10-hole drilling program was also approved earlier in 2023 for the Formentera project, reflecting a phased exploration approach.
Expanded Portfolio Including Brazilian Rare Earth and Niobium Exploration
In addition to lithium brine projects in Argentina, Patagonia Lithium holds 41,746 hectares of Brazilian concessions targeting ionic rare earth element (REE) clays, niobium, antimony, and lithium in pegmatites. The company’s Brazilian ground borders CMOC’s niobium mine in Goiás State, the world’s largest niobium producer with annual output around 10,024 tonnes, providing strategic proximity for niobium exploration.
This diversified portfolio aligns with global demand for critical minerals essential to energy transition and advanced technologies. Lithium, niobium, and rare earth elements are key raw materials for batteries, renewable energy, and electronics. Patagonia Lithium’s multi-commodity focus offers exposure to complementary markets while mitigating single-commodity risks.
Upcoming Investor Briefing and Future Testing Milestones
Patagonia Lithium will host an investor briefing on Wednesday, 19 August 2026 at 12:30 pm AEST, with Executive Chairman Phillip Thomas updating on drilling progress and company developments. Shareholders and investors can register online via Zoom as detailed in the company announcement.
The immediate next step is packer assay testing at 210 metres as drilling advances toward 600 metres. Assay results are anticipated within 3 to 4 weeks post-submission, providing detailed chemical analysis of brine samples. Complementary porosity assessments using borehole magnetic resonance, gamma ray, and specialist core measurements will further define aquifer characteristics in the primary 250-400 metre target zone.
Exploration Background and Prior Drilling Success at Cilon
Patagonia Lithium’s drilling program at Cilon builds on prior successful holes and geophysical surveys. The company described progress as "exceptional based on lithium assays and pump tests," supporting the deeper drilling campaign. The use of magnetotelluric geophysics to guide well placement reflects a disciplined, data-driven exploration strategy.
Increasing specific gravity values from 1.04 at 66 metres to 1.06 at 186-200 metres indicate progressively mineralized aquifers, consistent with lithium brine targets. This pattern is expected to continue in the 250-400 metre zone, where lithium concentrations may peak due to aquifer hydrogeology.
Exploration Risks and Limitations of Visual Core Analysis
Investors are cautioned that visual mineral abundance estimates from core samples do not replace formal laboratory analyses and do not provide information on impurities or physical properties critical for resource evaluation. While visual porosity and core photography offer useful field insights, comprehensive metallurgical and economic assessments require detailed lab testing of core and brine.
Lithium brine exploration involves technical, regulatory, and commercial risks. Presence of dissolved lithium does not guarantee economic viability; factors such as lithium concentration, extraction methods, water availability, permitting, and market conditions influence project potential. Although environmental assessments are positive, future production approvals will require further regulatory processes. Current packer test results represent discrete intervals and may not fully reflect overall aquifer productivity in the target zone.
