American Lithium - A Promising Uranium Developer in Peru

About American Lithium

American Lithium is actively engaged in the development of large-scale lithium projects within mining-friendly jurisdictions throughout the Americas. The Company is currently focused on the continued development of its strategically located TLC Lithium Claystone Project in the richly mineralized Esmeralda lithium district in Nevada, as well as continuing to advance its Falchani Hard-rock Lithium Project and Macusani Uranium Project in southeastern Peru. All three projects, TLC, Falchani and Macusani have been through robust preliminary economic assessments, exhibit strong expansion potential and enjoy strong community support. Pre-feasibility work is well advanced at Falchani and has commenced at TLC.

Interview with CEO, Simon Clarke, and Ted O'Connor, Executive Vice President

Macusani Uranium Project Gains Credibility

American Lithium's Macusani uranium project in Peru has recently been elevated to the "prospective mines" category in the World Nuclear Association's Nuclear Fuel Report. This means the project is now considered economically viable and likely to reach production.

Simon Clarke, CEO of American Lithium, explained that the project has been elevated because of its large resource size, projected low costs, and timeline to production. The Macusani project has a resource of 124 million pounds of U3O8 and economics showing it could be a low cost operation.

Industry expert, and Executive Vice President, Ted O’Connor added that not all projected mines factored into the supply stack will reach production due to issues like high costs. O’Connor believes the Macusani project has a good chance of being built thanks to its strong economics at conservative uranium prices.

Peru Seen as an Improving Mining Jurisdiction

O'Connor and Clarke highlighted that Peru is viewed as having one of the better mining jurisdictions in South America. The country has a strong mining code, reasonable fiscal regime, and mining is a major part of the economy.

Recent political turmoil had slowed progress on permitting and project development. However, Clarke said the new administration seems the most pro-mining since the 1990s and has been cutting permitting times.

For lithium, they are expediting the process to just 3-6 months for environmental approvals. Uranium would still take longer but the target is now 6 months versus previously taking over 2 years. This is a very positive development for American Lithium's projects.

Lawrence Stefan, VP of Operations for American Lithium in Peru, further reinforced confidence in Peru as a mining jurisdiction. He stated the country has world-class deposits and a society that ultimately supports responsible mining. The Macusani deposit could be a multi-decade producer of uranium for both Peru and global demand.

Strategic Investors Taking Notice

With uranium prices rising and Macusani's increased credibility, Clarke noted they have received recent approaches from strategic investors interested in the project. Having a world-class uranium asset in a proven mining jurisdiction is attracting attention.

Clarke mentioned they plan to engage with additional potential strategic partners and financial institutions during industry conferences. Producing a uranium concentrate sample from pilot plant studies would also allow interested parties to conduct due diligence tests.

Spin-Out Potential Still on the Table

American Lithium had previously considered spinning out the Macusani uranium project into a separate public company. This would allow the market to properly value the asset and could accelerate its development.

While uranium market conditions in early 2023 were not ideal for a spin-out, Clarke said they will continue assessing options. If permitting timelines in Peru substantially improve, he believes separating Macusani would likely maximize shareholder value.

However, they are not in a rush and will wait for the right conditions. American Lithium is under no pressure to divest of this significant project.

Key Takeaways

• Macusani uranium project now considered economically viable by nuclear industry experts
• Peru working to fast-track permitting could accelerate development
• Strategic investors approaching due to quality of asset and jurisdictions
• The proposed spin-out into separate company still an option to maximize value
• Macusani has clear potential to become a long-life, low-cost uranium producer

Conclusion

With a large uranium resource, strong economics, Peru's mining-friendly policy shifts, and strategic investor interest, American Lithium's Macusani project appears primed for further advancement.

The company offers investors uranium exposure combined with lithium claystone assets in Nevada. As they work to de-risk both projects and seek strategic partners, American Lithium has visible catalysts ahead.

In a rising uranium price environment, the Macusani project stands out as one of the likely mines to be built. Its economics remain robust even at conservative assumptions. Patient investors could see substantial long-term upside as American Lithium moves this impressive uranium deposit towards production.