Lithium Chile Inc.‘s (TSXV:LITH) (OTC:LTMCF) Argentinian subsidiary, Argentum Lithium S.A., has been awarded a 8,445 hectare concession in the Salar de Arizaro by the Salta Provincial Mining and Energy Corporation (REMSa).
The company said on Monday that it was one of thirteen companies that competed for five different blocks in the bidding process.
Block IV is the largest of the five blocks. It’s strategically located north of Lithium Chile’s 20,800-hectare project in the Arizaro basin. It sits approximately 18 kilometers north of the ARDDH-02 well, which the company has already drilled.
Portofino Resources Inc. (TSXV: POR) (OTCQB: PFFOF) (FSE: POTA) completed an extensive exploration program on Block IV during 2023, providing valuable geological data. This program involved collecting and analyzing over 40 surface brine samples. Additionally, 35 trenches were excavated to confirm the presence of shallow brine tables in the area.
Furthermore, the exploration effort included conducting geophysical surveys covering a total distance of 69,000 meters, utilizing VES (Vertical Electrical Sounding) technology. These surveys revealed the existence of a subterranean aquifer with depths reaching up to 1000 meters. Also, low resistivity horizons were successfully identified and interpreted as potential brine-bearing targets within Block IV.
“Being awarded Block IV is a wonderful achievement for us,” Steve Cochrane, Lithium Chile’s president and CEO, said. “It has the potential to significantly increase our lithium resource without the added expense.”
“We have the equipment, capable team and infrastructure already in place, which positions us to swiftly advance the project. Adding an additional 8,400 hectares to our already substantial land position makes Lithium Chile a dominant player in the basin.”
Lithium Chile paid USD$5.7 million to REMSa for the award.
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Lithium Chile will pay half the expenses in JV with Portofino
Lithium Chile holds a property portfolio comprising 111,978 hectares in Chile and 29,245 hectares in Argentina. The company possesses four properties, encompassing a total of 21,329 hectares, with potential prospects for gold, silver and copper.
Additionally, Lithium Chile signed a partnership agreement with Portofino regarding a potential joint venture arrangement. The intent of the JV is to capitalize on the work and knowledge gained by Portofino during its exploration program carried out on Block IV.
The agreement will allow Portofino to obtain a 50 per cent net equity interest in Block IV by contributing half of the award expenses and exploration costs. The completion of the joint venture depends on Portofino raising the required funds and entering into a definitive agreement, which is expected to occur within the next two months.
The company will immediately file an Environmental Impact Study (EIS) for an exploration program slated for completion on Block IV in 2024. The company’s established infrastructure near Block IV optimizes use of resources and allows for integration of exploration activities.
But there are plenty of other companies involved in the pursuit of the white gold in Argentina.
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The demand for lithium has never been higher.
As part of the renowned ‘Lithium Triangle’, Argentina possesses an estimated 20 per cent of the world’s lithium resources. The country primarily holds these reserves in the salt flats of the northwest. Additionally, the provinces of Catamarca, Salta, and Jujuy play a pivotal role in this mineral wealth. With the growing demand for electric vehicles (EVs), Argentina’s lithium shines as a beacon for a greener future.
Endowed with the world’s second-largest reserves of this ‘white gold,’ Argentina finds itself at the epicenter of a geopolitical contest.
President Javier Milei has noted the intense interest from industry leaders like Elon Musk and the U.S. government in the nation’s lithium potential, underscoring the high stakes involved and Argentina’s crucial role in the burgeoning EV era.
This highlights the necessity for a legal framework that upholds property rights while managing international interest. This bodes well for established companies like Albemarle Corporation (NYSE: ALB) and the newly merged Arcadium Lithium plc (NYSE: ALTM) (ASX: LTM) as well as juniors like Lithium South Development Company (TSXV: LIS) (OTCQB: LISMF) and Recharge Resources Ltd. (CSE: RR) (OTC: RECHF).
These companies stand to benefit from a positive political climate, open to business, and other political and social benefits coming from international cooperation bills such as President Joe Biden’s Inflation Reduction Act (IRA).
Specifically, the IRA could mean substantial tax breaks for American companies, or companies operating in countries with free trade agreements, involved in the electric battery supply chain.
Lithium South Development Corporation is a sponsor of Mugglehead news coverage
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