Kachi PFS and Exploration enters new stage
Lake raises $2m in Placement
- Lake welcomes investor support with commitments for a private placement of A$2 million to sophisticated and professional investors.
- Funds to advance PFS and pilot plant at Kachi Lithium Brine project and exploration at Cauchari and Olaroz projects.
Under the placement, the Company will issue approximately 45,000,000 new fully paid ordinary LKE shares (Offer Shares) at $0.045 cents per share (Placement) to sophisticated and professional investors using its existing placement capacity under ASX Listing Rules 7.1 and 7.1A.
Funds raised through the Placement will be used by Lake to complete the Pre-Feasibility Study (PFS) and advance the construction of a pilot plant using the Lilac direct extraction process at the Kachi Project, together with exploration at Olaroz and Cauchari Lithium Brine Projects, and additional working capital. Funds will also be used towards closing the remaining convertible Notes with a temporary halt on conversions while being negotiated.
Lake's Managing Director Steve Promnitz commented: "Lake welcomes the support of investors at this critical time in the advancement of the Company's key projects, with the Kachi PFS set for completion in the next few months followed by the launch of the planned pilot plant. This will demonstrate the compelling nature of a flexible process that produces high quality lithium products at the low end of the cost curve, with potentially industry-leading recovery rates."
"Low costs and consistent quality product have been a focus by downstream players in the lithium market. The new discovery at Cauchari has demonstrated the successful approach to exploration which augers well for Olaroz. Our discussions continue with potential development partners. These are exciting times for Lake and we are focused on seizing the opportunity for the benefit of all shareholders."
Lake Resources Trading Halt has now been lifted.
About Lake Resources NL
Lake Resources NL (ASX:LKE) is a lithium exploration and development company focused on developing its three lithium brine projects and hard rock project in Argentina, all owned 100%. The leases are in a prime location among the lithium sector's largest players within the Lithium Triangle, where half of the world's lithium is produced. Lake holds one of the largest lithium tenement packages in Argentina (~200,000Ha) secured in 2016 prior to a significant 'rush' by major companies. The large holdings provide the potential to provide consistent security of supply demanded by battery makers and electric vehicle manufacturers.
The Kachi project covers 69,000 ha over a salt lake south of FMC's lithium operation and near Albemarle's Antofalla project in Catamarca Province. Drilling at Kachi has confirmed a large lithium brine bearing basin over 20km long, 15km wide and 400m to 800m deep. Drilling over Kachi (currently 16 drill holes, 3100m) has produced a maiden indicated and inferred resource of 4.4 Mt LCE (Indicated 1.0Mt and Inferred 3.4Mt) within a 8-17 Mt LCE exploration target (refer ASX announcement 27 November 2018).
A direct extraction technique is being tested in partnership with Lilac Solutions, which has shown 80-90% recoveries and lithium brine concentrations in excess of 3000 mg/L lithium and is planned to be trialled on site in tandem with conventional methods as part of a PFS to follow the resource statement. Scope exists to unlock considerable value through partnerships and corporate deals in the near term.
The Olaroz-Cauchari and Paso brine projects are located adjacent to major world class brine projects either in production or being developed in the highly prospective Jujuy Province. The Olaroz-Cauchari project is located in the same basin as Orocobre's Olaroz lithium production and adjoins Ganfeng Lithium/Lithium Americas Cauchari project, with high grade lithium (600 mg/L) with high flow rates drilled immediately across the lease boundary.
Two drill rigs are currently drilling at Cauchari with results anticipated to extend the proven resources in adjoining properties into LKE's area with results anticipated from November into December 2018. This will be followed by drilling extensions to the Olaroz area in LKE's 100% owned Olaroz leases.
Significant corporate transactions continue in adjacent leases with development of Ganfeng Lithium/Lithium Americas Cauchari project with Ganfeng announcing a US$237 million for 37% of the Cauchari project previously held by SQM. Nearby projects of Lithium X were acquired via a takeover offer of C$265 million completed March 2018. The northern half of Galaxy's Sal de Vida resource was purchased for US$280 million by POSCO in June 2018. These transactions imply an acquisition cost of US$55-110 million per 1 million tonnes of lithium carbonate equivalent (LCE) in resources.
The demand for lithium continues to be strong for lithium ion batteries in electric vehicles, according to recent data from the leading independent battery minerals consultant, Benchmark Mineral Intelligence. Supply continues to be constrained suggesting good opportunities for upstream lithium companies.
Lake Resources NL