Lake Resources N.L. (ASX: LKE) is into the operations of lithium exploration. The company has exploration programme in its portfolio, including regions with prime lithium basins and pegmatites in Argentina.
The company today, on 3 April 2019, announced that it has started a pre-feasibility study (PFS) at its fully-owned Kachi Lithium Brine Project. The project is in an area, which is highly prospective for lithium brine and is situated to the south of Livent/FMC’s lithium production centre, which has been in operations for more than 20 years in Catamarca Province in close proximity to Albemarle’s Antofalla project. The recent acquisition cost of US$50-$110 million per 1 million tonnes of LCE resources signified significant corporate transactions that recently took place involving lithium brine assets in the region.
A maiden resource for Kachi of 4.4 million tonnes lithium carbonate equivalent (LCE) has been recently announced by the company, within an exploration target of 8-17 million tonnes lithium carbonate equivalent. This is an indication of a strong foothold of the company, which places it among the top 10 lithium brine resources globally. The increasing demand of sources who can supply new lithium along with constrained production from major producers will be an opportunity for Lake with huge resource reserves.
An international engineering company will work with Lake at Kachi on the PFS going forward. The project’s technical and economic viability will be studied through examination, including conventional processing and direct extraction methods. Expected cost reductions are significant coupled with superior recoveries for direct extraction compared to the evaporation ponds.
The company is currently discussing the funding of production development and partnership at Kachi Project with several parties in order to receive assistance with the financing on the feasibility study following from the PFS.
The Managing Director of the company, Steve Promnitz said that the commencement of the PFS is a significant milestone for Lake and for the Kachi Project, the most advanced of Lake’s four lithium projects in Argentina, which is wholly-owned. The Kachi Project has the capacity to become a significant lithium producer globally.
The company will be able to demonstrate how Kachi can be taken into production using new direct extraction methods at a competitive cost, once the discussions of the company with various technical providers of internationally acceptable PFS studies complete soon. Lake is determined to enhance its development into production at Kachi along with Olaroz-Cauchari projects since it is in aware of the opportunities present. Kachi is one of the largest wholly-owned lithium brine basins in the ‘Lithium Triangle’ and contributes half of the world’s lithium output at lowest-cost.
On the price-performance front, the stock of Lake Resources was trading at $0.059, an increase of 7.273% during the day’s trade, with a market capitalisation of ~$20.18 million (At market close on 3rd April 2019). The stock has generated negative returns of 36.78% and 11.29% over the past six months and one-month period, respectively. Its 52-week high price stands at $0.145 and 52-week low price at $0.048 with an average trading volume of ~325,178.
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