USA News Group
Commentary
VANCOUVER, BC, April 26,
2024 /PRNewswire/ -- USA News Group – Already in 2023 there have
been two multibillion-dollar takeover bids rejected that
would've involved critical battery metals assets. The first to go
down was Liontown Resources turning down a US$3.6 billion offer from Albemarle
Corporation (NYSE:ALB), followed by Teck Resources
Limited (NYSE:TECK) (TSX:TECK-A) (TSX:TECK-B) rejecting a
US$23.2 billion merger proposal
from Glencore plc (OTC:GLNCY). Meanwhile, mining giant
Rio Tinto Group (NYSE:RIO) is rumored to be on the prowl for
more lithium assets after already buying a lithium mine for
$825 million in Argentina, in the same province (Salta) as
Lithium South Development Corporation's (TSXV:LIS)
(OTC:LISMF) Hombre Muerto North Lithium project (HMN Li
Project).
At this latter project, Lithium South Development
Corporation (TSXV:LIS) (OTC:LISMF) recently completed the
final drill hole of a resource expansion program, designed to
expand upon the HMN Li Project's maiden resource of 0.57 MT
Li2CO3 equivalent (M+I) from 2019.
"We are pleased to have completed the 2022-2023 resource
expansion program at the HMN Li Project," said Lithium
South's President and CEO, Adrian F. C.
Hobkirk. "We look forward to full results and the
delineation of a new lithium resource."
Throughout this 2023 resource program to date, Lithium
South has received excellent lithium values from all holes
completed to date. These included an average of samples of 663 mg/L
Li, with a range of 320-752 mg/L Li, and ranging from 569 mg/L Li
to 708 mg/L Li in another drill hole. The latest results also
include nine packer samples collected between 24 and 189 meters,
with a density range of 1.215 to 1.218 g/mL and a conductivity
range of 196.3 to 209.5 mS/cm.
So far there's been significant progress made on the HMN Li, as
Lithium South completed a Preliminary Economic Assessment
(PEA) in April 2019, expanded
drilling efforts, and joined up with multiple experts in Direct
Lithium Extraction (DLE) technology, to potentially increase the
profitability of the project.
However, the original 2019 PEA assessment was based only the
project's original 383-hectares of claims (Tramo), whereas now the
project covers 5,687 hectares spread across 9 mining concessions.
Now the goal of Lithium South's current expansion program is
to not only increase the resource size, but also move closer
towards a full Feasibility Study. The Project is already surrounded
by two leading lithium producers, Livent and POSCO,
which acquired the property from Galaxy Resources (now
Allkem) for US$280
million.
With regards to testing the potential of DLE, Lithium
South has provided three 2,000-liter bulk samples of
high-quality HMN Li brine for testing by its three strategic
partners: China's Chemphys
Chengdu, Argentina's Eon
Minerals, and California-based
Lilac Solutions.
Located in the same Salta
Province of Argentina,
Rio Tinto Group (NYSE:RIO) completed its acquisition of the
Rincon lithium project for $825
million back in May
2022.
"Rincon strengthens our battery materials business and positions
Rio Tinto to meet the double-digit growth in demand for
lithium over the next decade, at a time when supply is
constrained," said Jakob Stausholm,
CEO of Rio Tinto. "We will be working with local
communities, the Province of Salta and the Government of
Argentina as we develop this
project to the highest ESG standards."
To optimise the process and recoveries,
Rio Tinto continued to produce
battery-grade lithium carbonate from raw brine from the existing
pilot plant operating at site. Early construction activities
have progressed on phase one camp facilities with rooms for 250
persons completed, while airstrip permits were received and
contractors mobilised.
Detailed studies for the full scale operation have advanced, and
Rio Tinto's exploration campaign progressed to
further understand Rincon's basin and brine reservoir. The plan is
to have the starter plant serve as a pilot for a much larger,
50,000-tonne/year plant there. As well, Rio Tinto has
also signed a Memorandum of Understanding with Ford Motor
Company for delivery of lithium carbonate from the Rincon
salar.
Lithium giant Albemarle Corporation (NYSE:ALB) currently
sources its lithium production from several locations worldwide.
However, Albemarle's largest source of lithium production is from
its operations in Chile, where it
extracts lithium from the Salar de Atacama, one of the world's
largest and richest lithium brine deposits. While also having
lithium production facilities in the USA, Australia, and China, it was recently rebuffed in an attempt
to secure more lithium through the now-rejected US$3.7 billion
takeover bid of Liontown Resources and its Kathleen Valley
project slated for first production in mid-2024, located in
Western Australia.
The Kathleen Valley project is among the world's largest and
highest-grade hard rock lithium deposits. Much like Rio
Tinto, Liontown has also signed a supply agreement with
Ford Motor Company.
The rejection by Liontown didn't end
Albemarle's takeover attempts. In fact,
Albemarle began canvassing Liontown's
shareholders, all while refusing to budge from its rejected
$2.50 per share bid, which came at a
63% premium to the previously undisturbed price.
Teck Resources Limited (NYSE:TECK) (TSX:TECK-A)
(TSX:TECK-B) rejected a lot more than Liontown did, when it
turned down a US$23.2-billion merger
proposal from Glencore plc (OTC:GLNCY) (OTC:GLCNF). It's
believed that Teck is unlikely to accept an improved
proposal from Glencore due to the "significant value
leakage" from merging with the large public coal company and the
"elevated" regulatory risks involved. There's also a patriotic
aspect in play, as Teck is Canadian focused, while
Glencore is Swiss-based.
"There's more to all of this than what the share price would be
in the offer because I think that Teck is a national champion for
Canada," said Patricia Mohr, an economist and former
vice-president at the Bank of Nova
Scotia. "There are benefits for the Canadian mining industry
associated with this. I think it would, personally, be a pity if we
lost another of our major international players in the mining
industry."
Late in 2022, Glencore had expressed its intent to add
lithium to the suite of metals that it trades, citing the raw
material's hot demand. Glencore doesn't own lithium mines
but produces copper, nickel and cobalt, other raw materials that it
terms "commodities of the future," as they are needed to
manufacture batteries, electric cars and renewable infrastructure
that will help the world transition to a greener economy.
Source:
https://usanewsgroup.com/2023/04/11/quite-possibly-the-best-lithium-resource-in-argentina-perhaps-the-world/
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SOURCE USA News Group