Anyone remotely familiar with the lithium juniors space has heard of Pure Energy Minerals, (TSXV:PE) (FRANKFURT:AHG1:GR) (OTCQB:HMGLF) and no doubt the sizzling hot, new kid on the block, Lithium “seXy” Energy Corp, featuring legendary natural resource investors Frank Guistra & Paul Matysek and of course there’s Dajin Resources, currently the cheapest way (lowest market cap) to gain exposure to lithium love in both Nevada and Argentina. Western Lithium Corp. is another noteworthy junior, also with prospective assets in Nevada & Argentina.
The number of publicly listed companies owning or controlling property in Nevada amenable to lithium exploration continues to grow. In addition to the 4 mentioned, there’s Nevada Sunrise Gold, Ashburton Ventures, Lithium Corporation & Ultra Lithium, 8 in total. Lithium X Energy, Nevada Sunrise & Ashburton are new entrants this year. Six are pure-play lithium juniors, each with a combination of strengths and weakness. Experience of management & financial backers, quality & size of lithium resource(s), location (county/basin), stage of exploration / process development and operating technology / process are of paramount importance. Why is the lithium sector such a big deal? I asked Simon Moores of Benchmark Mineral Intelligence why lithium pricing is moving up even as other minerals & metals have moved markedly lower, quote,
“Lithium was different to all other minerals & metals this year, while every other commodity price fell, the lithium price was rising. This is because it serves one of the first industries driven by hi-tech markets, not an industrial ones.”
Pure Energy Minerals has a lot going for it, making it one of the more appealing investment opportunities in the lithium sector. First off, readers can check off the management box. The Company is stacked with 10 highly experienced and successful individuals from the ranks of Management, Board and Technical Advisory. Seven have decade(s) of expertise in lithium and/or advanced degrees in Geology, Hydrology and Geochemistry. Several have substantial industry contacts, adroitly drawing in strong financial backers. The Company’s flagship Clayton Valley South project is contiguous to the only lithium producing enterprise in North America – Albemarle’s Silver Peak Brine project. At 9,000 + acres, the property is the largest in the Esmeralda County area. Pure Energy boasts an 816,000 Mt Lithium Carbonate Equivalent, NI 43-101 compliant Inferred resource and a cornerstone supply agreement with Tesla Motors Inc (NASDAQ:TSLA), making it one of just two juniors at an advanced exploration / early process development stage, the other is Western Lithium.
If readers remember little else, please recognize that Korean Multi-national POSCO and Israel based process technology company Bateman Advanced Technologies have demonstrated strong votes of confidence in Pure Energy’s Clayton Valley South project. The Company also enjoys proactive partnerships with world-renowned SRI International and the University of British Columbia. It’s the technology collaborations with POSCO & Tenova Bateman that I highlight and elaborate on, a tremendously important differentiating factor. For the past 50+ years brine harvesting of lithium via massive evaporation pools has been the norm in Nevada and in the Lithium Triangle of Chile, Argentina & Bolivia. Dating back much further is hard rock mining of pegmatites containing the lithium bearing silicate spudomene. Hard rock extraction has proven to be increasingly energy intensive, costly and less environmentally friendly compared to newer approaches.
The fact that Pure Energy is able to engage in meaningful interactions with POSCO & Tenova Bateman is testament to the quality of its Clayton Valley South project and stage of exploration / process development. In coming years, the technologies emerging lithium producers chose to incorporate into flow sheets will make or break them. Next decade, brine harvesting and conventional hard rock mining will begin to fall by the wayside as superior technologies come to fruition. I liken this situation to events in the uranium sector where In-Situ Recovery techniques have made substantial inroads at the expense of conventional hard rock mining. POSCO & Tenova Bateman are leaders in paradigm shifting technologies. Both companies are cutting their teeth on Clayton Valley lithium brines and brines from a few other projects including Western Lithium’s Cauchari-Olaroz in Argentina. ASX listed Orocobre Ltd. recently announced it has entered into an MOU with Tenova Bateman for that company’s Argentinian lithium project.