ION Energy (ION) - Resource Indication by End of Year

ION Energy Ltd. is a TSX-V-listed lithium exploration and development company focused on the development of its lithium assets in Mongolia. The company’s asset portfolio consists of the Baavhai Uul and the Urgakh Naran Lithium projects. The Baavhai Uul Lithium Brine project boasts as being the largest exploration licence in Mongolia and consists of more than 80,000 hectares of highly prospective Lithium brine deposits. The Urgakh Naran Lithium Brine project is an approximately 20,000-hectare land package, situated in the South Gobi Desert, approximately 150 km from the Baavhai Uul Lithium project.

Company Overview

The company announced at the beginning of May that it had encountered 25% lithium anomalies at its Baavhai Uul project, with further drill results pending. The White Wolf prospect of the company remains highly prospective, with previous results showing up to 1,502 ppm lithium clays and evaporites with drill holes averaging a grade of 700 ppm lithium from a depth of 0.5 m to 3.5 m. 

The company recently announced that it had made a significant lithium brine discovery at its Urgakh Naran Lithium Brine project. The brine sample was collected from a shallow surface pool at the project and shows 918 mg/l lithium. The result boasts as the highest-grade lithium brine sample ever taken in Mongolia. The company plans to follow up on the results with brine testing at depth. The testing is scheduled to commence upon completion of its geophysical and shallow auger hole program.

ION Energy Ltd. has to date completed 72 auger drill holes, at its Urgakh Naran lithium brine project totalling 820.5 m. The company has collected 427 geochemical samples including brine samples, which have all been submitted for lithium analysis, with results pending.

Management

ION Energy Ltd. is led by Ali Haji, who serves as CEO and Director. Haji has more than 13 years of international experience, including asset management, risk analysis and program governance. He has served as director of Antler Hill Mining Ltd. as well as Spirit Banner II Capital Corporation.

Matthew Wood is the chairman of the company’s board. Wood was a founding member of Avanco Resources Ltd. which was sold to OZ Minerals in March 2018 for AUD$ 440 million as well as Hunnu Coal which was sold for AUD$ 500 million in 2012 to Banpu PLC.

John McVicar is the Chief Financial Officer (CFO) of ION Energy Ltd. and brings with him more than 30 years of international financial and management consulting experience. He has held various senior management positions in Canada, the USA, South America and Asia.

The board of the company consists of Wendy Li, who serves as the Director of Asia, as well as Bataa Tumur-Ochir, Aneel Waraich and Enkhtuvshin Khishigsuren serving as Directors. Li brings with her more than 18 years of experience in commercial and business development in Asia, including Mongolia and China. Tumur-Ochir is a Mongolian citizen as well as a Director of Steppe Gold Inc. He is also an advisor to the Mongolian Ministry of Mining and Heavy Industry. Aneel Waraich is the founder of ATMA and ATMA Corp. and has experience in investment banking through time spent at Dundee Corporation. He holds an MBA from the Goodman Institute of Investment Management at the John Molson School of Business. Enkhtuvshin Khishigsuren has over 30 years of experience in the Mongolian Mineral sector and has been a part of various noteworthy discoveries in the country.

Paul Fornazzari, Don Hains and Dr David Deak serve as Advisory Board members. Fornazzari previously served as the inaugural chair of Lithium Americas Corp. and is credited with securing the initial investment received from Mitsubishi and Magna International. Hains is the president of Hains Engineering Company Ltd. and principal of Hains Technology Associates. He has more than 30 years of experience in the mineral sector and has written various NI 43-101 technical and due diligence reports on lithium projects across the world. Dr Deak has vast amounts of experience in the lithium mining sector including mine development, battery supply chain developments, energy storage systems, renewable energy, and electric vehicles. He is President of Marbex LLC and previously served as the Chief Technology Officer (CTO) and Senior Vice President (SVP) of Lithium Americas Corp.

The management team of the company is tasked with advancing its Baavhai Uul and Urgakh Naran projects, located in Mongolia.

Baavhai Uul project

The Baavhai Uul project of the company is an 81,000-hectare land package and the largest exploration licence in Mongolia. The project boasts an average grade of 426 ppm lithium with low magnesium and potassium ratios. The brine deposit is an endorheic basin, meaning that it has no outflow to an external body of water such as a river or ocean, and only loses water through evaporation.

The lithium brine deposit is favourable for the formation of large crystals, through its low potassium and magnesium, with the deposit laying approximately 20 m below the surface. The project also lies in the Gobi Desert, which empowers it with naturally high evaporation rates.

The inaugural exploration drilling campaign conducted at the project in 2021 encountered various high-grade lithium discoveries including the White Wolf Prospect. The drilling encountered deposits of up to 1,502 ppm lithium in clays and evaporites.

Ali Haji explains the company’s exploration initiatives at the Baavhai Uul project as follows:

“On Baavhai Uul, we drilled 300 holes across an 81,000-hectare licence. That is important to note because 81,000-hectare is about 5 times the size of Vancouver. Obviously, when we did that drilling program, we didn't have the necessary skill set in the country to help expand our assets, but we had an opportunity to scratch the surface.”

Urgakh Naran Lithium Brine project

The Urgakh Naran lithium brine project of ION Energy Ltd. is a 20,000-hectare lithium brine project located in the South Gobi Desert. The project boasts as having the highest-grade lithium brine to ever be collected in Mongolia. The brine samples collected from a shallow surface pool at the project contained 918 mg/l of lithium.

The project has seen previous work conducted including a hydro-chemical sampling program which identified various shallow lithium brine deposits. The previously conducted works have been successful in identifying various exploration targets.

The maiden exploration program conducted at the project consisted of 7 lines of Transient Electromagnetic (TEM) analysis with 72 auger holes for a total of 820.5 m of exploration. The basin is over 6 km wide and 20 km long, providing abundant exploration possibilities.

Ali Haji explains that the exploration initiatives to date has enabled the company to be able to identify where it will place the monitoring wells of the project, he states:

“We put in 72 holes, we've done 88-line km of geophysics and TEM, what that allows us to determine is where the monitoring wells go in. The monitoring wells will allow you to measure your flow rates, they will allow you to measure your average grade and ultimately, based on the rudimentary calculations that would be average grade versus volume, you have an early resource indication.”

Exploration updates

ION Energy Ltd. released an update regarding its exploration activities at its Mongolian projects at the beginning of May 2022. The Baavhai Uul project has shown 25% lithium anomalies with the remaining drilling results of the project pending. The completed drilling program at the project consisted of 22 auger holes to a maximum depth of 6 m and holes drilled every 0.5 m. The drilling program was able to identify a discovery at the project, namely the White Wolf prospect. The highlights of the drilling program include 1,502 ppm of lithium in clays and evaporites with drill hole AU-17 of the program averaging 700 ppm lithium from a depth of 0.5 m to 3.5 m and drill hole AU-16 averaging 650 ppm lithium from a depth of 4 m to 6 m, with the last sample returning a grade of 860 ppm lithium.

The exploration initiatives at the Urgakh Naran project have been submitted for analysis and consist of 427 geochemical samples which include brine samples obtained from its maiden exploration program.

Future initiatives

ION Energy Ltd. is fully funded for its exploration initiatives and plans to publish a resource estimate of the Urgakh Naran Lithium Brine project by the end of 2022. The company further plans to advance the Baavhai Uul project and to better understand its mineralogy, Haji states the company’s intent with its fund as follows:

“...with respect to the capital that we have today, we are well-funded to allow us to not only allow the company to get to an early resource allocation on Urgakh Naran, but to expand and better understand Baavhai.”

The funds allowing the company to pursue its exploration and advancement initiatives are accredited to the bought deal offering it concluded with in 2021. The offering resulted in CAD$ 5.75 million in proceeds for the company. Haji states:

“With respect to what we did with the bought deal last year, we announced the CAD$ 3 million, we took CAD$ 5.75 million, we had demand for CAD$ 10 million. We didn't want to overly dilute, but we wanted to ensure that we were bringing in the right players.”

ION Energy Ltd. is contemplating listing on the AIM stock exchange in the near future, to allow it with liquidity in its share price, Haji explains:

“…the liquidity from a retail perspective is where we lack, so the AIM listing is being contemplated in order to bring in some retail money that allows us to, 1, settle in Canada, 2, list in the UK, but also to build some liquidity into our share price.”

Haji explains that ION Energy Ltd. will explore its projects to where it is able to release a resource estimate allowing the company to bring in a partner, he explains the company’s future as follows:

“…our goal is that we will continue to explore. We will continue to arrive at an early resource indication, at which point we will look to a partner, at any level of that supply chain, that will ultimately work with us to bring these assets into production. ION is very much early days today, but as far as the strategics go, we have a mixed bag of strategics that we have an NDA with today and we hope to be able to announce something in short order.”

To find out more, go to the ION Energy website