Lake Resources progresses permitting at lithium brine project

By Trevor Hoey. Published at May 30, 2017, in Mining

Argentinean focused lithium exploration company Lake Resources N.L. (ASX:LKE) has confirmed the successful permitting progress of circa 49,000 hectares of exploration applications at its Olaroz – Cauchari Lithium Brine Project in the Jujuy Province, Argentina.

The applications adjoin the production leases owned by Orocobre and SQM/Lithium Americas and have the potential to display lithium in the same aquifers.

This development could be the trigger for a share price rerating, as the company’s market capitalisation does not appear to reflect the current value of its assets or the exponential value that could be realised during the exploration stage.

It should be share trading patterns should not be used as the basis for an investment as they may or may not be replicated. Those considering this stock should seek independent financial advice.

A private company acquired by LKE in November 2016 showed good foresight in applying for nearly 50,000 hectares of prime lithium brine areas prior to the lithium boom, a dynamic that has substantially increased the cost of areas prospective for the commodity.

LKE’s Managing Director, Steve Promnitz conceded that administrative issues had led to delays in the applications being processed, however these have been resolved with the applications now successfully moving to permitting stage.

LKE noted that its subsidiaries are working closely with the local regulators to promptly progress the applications to allow access to the areas.

In commenting on this development, LKE’s Managing Director, Steve Promnitz, said, “This is a very significant development for Lake Resources, particularly given the applications are situated in an area that can only be described as first grade with their true valuations likely to be realised through comprehensive exploration”.

LKE is also undertaking an aggressive exploration programme to explore/develop prime 100% owned lithium projects in Argentina, situated among some of the largest players in the lithium sector.

As indicated on the following map, LKE holds three key lithium brine projects located in the Lithium Triangle which produces half of the world’s lithium. LKE also holds one large package of lithium pegmatite properties which were an unappreciated source of lithium in Argentina until recently.

The three key brine projects held by LKE have similar settings to major world class brine projects being developed – Olaroz/Cauchari, Paso and Kachi in the highly prospective Jujuy and Catamarca Provinces.

One project is located next to Orocobre’s Olaroz lithium production and Lithium Americas’ Cauchari project, with another south of FMC’s lithium operation.

While LKE is only in the early stages of developing these projects, the quality of their landholdings in terms of proximity to existing high profile producers could make it one of the most highly sought after plays in the sector, and perhaps the subject of corporate activity.

In the interim, the following potential catalysts are worth pencilling in given the prospect of multiple news flow emerging across the company’s assets.

S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

Conflict of Interest Notice

S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.

Publishers Notice

The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.