Lithium Australia shares jumped by almost 20% on Monday on news the company had taken majority ownership of a promising Lithium clay project in Mexico.
The Perth-based Lithium processing specialist announced they had lifted their stake in the Electra joint venture in Sonora, Mexico, to 54% under the farm-in agreement with Canada’s Alix Resources Corporation.
The progress made in Mexico is the latest in a run of positive developments for Lithium Australia, including news last week that ASX 200 Lithium miner Galaxy Resources would take a direct stake in Lepidico, owner of the L-Max Lithium processing technology.
Lithium Australia have an exclusive license to use L-Max in W.A until July 2020, and the right to extend this for a further 20 years if they commit to building an L-Max plant anywhere in the world.
This puts Lithium Australia in the box seat with respect to any W.A based benefit that might come with Galaxy investing in technology owner Lepidico. It also opens up the opportunity of Galaxy providing Lithium feedstock to operate an L-Max plant in Western Australia.
The increase in Lithium Australia’s interest in the Electra JV was triggered by spending on a 16-hole RC program at Agua Fria that produced some encouraging results.
The drilling identified a 2.5km-long mineralised Lithium clay zone between 25 and 50 metres thick on the western flank of the prospect. Assay results included 1,058 ppm Lithium over 33 metres from a depth of only 3 metres, and 1,031 ppm Lithium over 48 metres from 63 metres.
Metallurgical testwork already conducted on Agua Fria samples showed that acid leaching at relatively low temperatures achieved 99% extraction of Lithium in just four hours. No roasting and no expensive reagents were required.
The Lithium clay horizons at Agua Fria are also anomalous in potassium, which may be recoverable as potassium sulphate, a major raw material for the fertiliser industry.
Lithium Australia Managing Director, Adrian Griffin, said “The move to majority ownership at Electra and the emergence of the western flank of Agua Fria as a significant discovery with near-term potential, reflects the depth and scope of the company’s unerring growth strategy to build a lithium business based on breakthrough processing technologies applicable to unconventional and once considered uneconomic feedstock sources. We will continue to partner closely with Alix to maximise the unfolding upside in Agua Fria in line with developments globally in the lithium-ion new battery era space.”
The next step for the Electra JV partners is to better understand the stratigraphy and the controls on higher grade Lithium values encountered close to the surface. A large sample is also being composited for further metallurgical studies.
