American Lithium (LI) - Recovery Grades at Nevada Improving
American Lithium Corp. is developing world-class lithium projects in the Americas and also has one of the largest underdeveloped uranium projects globally. The company has a near-term focus on mining-friendly jurisdictions and has an advantage when it comes to geographic and geological diversity in the development of world-class, scalable projects.
We met with Simon Clarke, CEO, and Director, American Lithium. Simon has over 25 years of experience in building companies, capital markets, and growth strategies in the mining, energy, and energy technology sectors. He is the founder and former CEO at M2 Cobalt Corp. His educational credentials include an LLB and Diploma in Legal Practice from Aberdeen University, Scotland.
American Lithium (formerly known as Menika Mining Ltd.) is a mining and exploration company focused on the development of their world-class lithium projects located in the Americas. The company is listed on the Toronto Stock Exchange (TSX-V: LI), the OTC Markets (OTCQX: LIACF), and the Frankfurt Stock Exchange. (FSE: 5LA1). The company was founded in 1974 and is headquartered in Vancouver, Canada. Lillooet Mining Ltd., Exploraciones Macusani S.A.C, and Minergia S.A.C are among the company's subsidiaries.
The company recently added 3 assets to its portfolio. The Falchani Lithium asset is a large-scale project with high-grade and high-purity deposits. The Macusani Uranium Project, the company's largest uranium asset, and the TLC Lithium Project in Nevada.
The Macusani Uranium Project
Located in Peru, the Macusani Uranium Project is the world's largest underdeveloped uranium project with low processing costs. This project has an NPV of $603M with a 40.6% IRR.
American Lithium has a large drill program planned in Peru and is awaiting the results of the ongoing Presidential elections in the country. The drilling permits for the project have already been received. The company is holding off its drilling project until the result of the election.
The Falchani Lithium Project
Located in Peru, the Falchani Lithium Project is the 6th largest hard rock lithium deposit globally. This estimate is based on 30% of the target area. The site has an NPV (Net Present Value) of $1.55Bn at a 19.7% IRR (Internal Rate of Return).
Based on the robust metallurgical testing, the site has the potential to produce high-purity battery-grade lithium carbonate through conventional processing. The site features a well-developed infrastructure with easy access to transport and water. The power is low-cost and labor is widely available. The technical team in Peru is collaborating with a local lab near the Falchani site to carry out the material sampling.
The TLC Lithium Project
Based in Nevada, this strategically located project features TLC claystone with under-developed lithium sedimentary basins. The asset is spread across a land area of 3,343 hectares and has a measured and indicated resource of 5.37 Mt. The central region of this project features epithermal mineralization which has produced 138 Moz silver and a large molybdenum supply in the past.
The TLC project is located at the Oregon border, an arid desert region where baseline environmental work has already been concluded. This study includes the culture, environment, archaeology, flora, and fauna in the region.
The Clayton Valley Lithium Project already has the environmental work concluded as the company looks to further improve the efficiency of its water use. American Lithium acquired water rights along with the purchase of a nearby ranch.
Enviro Consultants, a UK firm was brought on board by the company to carry out life cycle analysis. This is a part of finalizing the company's economic flowsheet with a strong focus on environmental sustainability.
American Lithium's technical team has made strong strides in Nevada. The company recently published a press release achieving 82% lithium extraction. This was made possible through the development of a hydrochloric acid leaching process and a roasting process. The acid leaching process enables the extraction of lithium in 10 minutes, leading to the production of technical high-grade lithium carbonate.
The roasting process allows for 82% lithium recovery with low impurities. The benefit of the claystone and the TLC site is the absence of deleterious materials such as Mercury or Arsenic, making the process significantly easier.
The company continues to refine the process to achieve 90% recovery where the 1200-1300 ppm samples can be upgraded to 2200 ppm for lithium-carbon recovery. This high-purity lithium can then be used for battery-grade applications. The process also allows for the recycling of the acid used, providing both environmental and economic benefits.
The company will be testing both the acid leaching and roasting processes over the course of the next 3 months before choosing the one that offers a lower carbon footprint and better economics.
As there's already a baseline environmental study in place, the company won't require an additional environmental impact study. The company is looking for formal approval from the local jurisdiction within the next two months, which would enable them to implement the operation on a larger scale by September.
The initial studies and the PEAs in Peru have returned promising results. The material can be concentrated to battery-grade at $4000/t which is favorable from a cost and OpEx (Operational Expenditure) perspective. The company is looking to carry out a similar study on their Nevada asset and eventually move towards a feasibility study. Additional drilling is planned in September for high-grade resources.
Since Nevada has a restriction on exploration over 5 acres of land without the Plan of Operation, the company intends to carry out drilling and box sampling to get a laydown area for future pilot work. The PEA and the balance sheet are scheduled to be finalized by 2021 end or early 2022.
Navigating the Political Climate
Peru currently has ongoing presidential elections where the margin for victory has been razor-thin. The recounts are ongoing in the country as once the winner is announced, American Lithium has a large drill program planned.
American Lithium saw a dip in their share prices following their recent acquisition. This was due to the previous legal challenges at the property and the uncertainty in lithium prices. The company is focused on ESG considerations as the push for domestically produced critical minerals continues to grow. In the US, a historic opposition against mining has been underway and along with the new US policy pushing towards EVs and a new economy in renewable energy generation.
As the world pushes towards cleaner energy alternatives, there has been a push in the US towards sustainable mining practices. As the US looks to reduce its reliance on China for refined battery materials and end products, American Lithium intends to become a domestic critical minerals supplier. This will also result in a drop in carbon emissions caused due to international shipping.
American Lithium currently has a liquidity of $17.5M and is looking to advance its projects while working on the feasibility study and its balance sheet. The company is looking for a US listing as they have a key asset in the country along with a strong retail shareholder base. The company plans to issue shares at a price of $1.70-$1.80 to raise additional capital for advancing their ongoing projects.