NEW YORK, November 15, 2018
NEW YORK, November 15, 2018 /PRNewswire/ --
FN Media Group Presents Microsmallcap.com Market Commentary
The US will be demanding more from its miners in the wake of the newly signed U.S.-Mexico-Canada trade agreement (USMCA). Increased demand from the US alone for critical metals could likely attract more attention towards miners of new energy metals such as Standard Lithium (TSX-V:SLL) (OTC:STLHF), Prophecy Development Corp. (TSX:PCY) (OTC:PRPCF), United Battery Metals (OTC:UBMCF)(CSE:UBM), European Electric Metals Inc. (TSXV:EVX)(OTC:EVXXF), and International Battery Metals Ltd. (CSE:IBAT) (OTC: RHHNF).
Strategists are already planning the next extensions to the trade deal, including the need to sign USMCA Critical Mineral Defense Supply Chain Agreements. Earlier in the summer the US Department of Commerce's list of minerals considered to be "critical" reached 35, stressing a dire need to target a boost in domestic supplies.
The 35-metal list was an increase from the previous 2017 USGS report listing 23 metals and minerals deemed critical to the economy and security of the United States. That report came almost immediately before US President Donald Trump signed an Executive Order designed to ensure secure and reliable supplies of critical minerals.
Among the metals most focused on, are those tied to the rapidly growing rechargeable battery and electric vehicles (EVs) markets, including lithium, cobalt, and vanadium. Miners working on projects in the US as Standard Lithium (TSX.V:SLL) (OTC:STLHF) with its flagship 180,000 acre South Arkansas Lithium Brine Project stand to benefit from this increase in domestic focus.
Standard Lithium's domestic efforts include developing a joint venture with global specialty chemical company LANXESS Corporation to commercially develop opportunities for lithium production, marketing and the sale of battery-grade lithium products extracted from brine that is a byproduct of existing bromine production facilities run by LANXESS in South Arkansas.
Uniting on a Critical Metals Common Front
As a group, North America will now look to form a common front on critical mineral production and advanced materials processing. While Canada is already a strong resource producer, Mexico is also a leading provider to the US of four minerals and metals on the US Critical Minerals List, for which the US is between 75-100% import dependent.
With the USMCA, in order for automakers to qualify for zero tariffs, 75% of auto components must be manufactured within the trade bloc (up from NAFTA's previous 62.5% mark). The result may be a need to import or produce even more critical metals such as lithium to meet these new requirements.
Alarmingly, the lithium market as a whole is expected to struggle to meet demand through 2025, thanks to growing production EVs from US manufacturers such as Tesla Motors. Innovative domestic lithium production, such as projects like Standard Lithium's (TSX.V:SLL) (OTC:STLHF) South Arkansas Lithium Brine Project could become ever more valued to the USMCA partnership.
The Trump administration has already indicated it wants to help however it can to identify new domestic sources of critical minerals. The government plans to help increase domestic exploration, mining and recycling by giving miners and producers electronic access to better mapping and geological data, and streamlining leasing and permitting for new mines.
But in the case of Standard Lithium's South Arkansas Lithium Brine Project might be just the type of innovation that the US and its partners need. The project utilizes a novel approach to unlocking ample supplies of lithium from brine already being produced and processed in commercial volumes for the recovery of other minerals primarily bromine.
Standard Lithium has developed a proprietary process that uses a solid ceramic adsorbent material with a crystal lattice that is capable of selectively pulling Li + ions from the "tail brine" or waste brine after it has gone through the bromine-extraction step at LANXESS three operating facilities in South Arkansas.
Bringing Out the Value of Brine
Standard Lithium is steadily building out a proposed lithium extraction pilot plant to be located in Eldorado, Arkansas, designed to process brine from various brine streams. Among those streams is one of the world's largest brine deposits, the Smackover Limestone Formation, of which the project is strategically located within.
The company recently announced a joint venture with partners LANXESS Corporation, a global specialty chemical company, in South Arkansas to develop commercial opportunities related to the production, marketing and sale of battery grade lithium products extracted from brine produced from the Smackover Limestone Formation. Upon proof of concept, Standard Lithium will provide existing rights and leases held in the Smackover Limestone Formation, and the pilot plant being developed on the property-in addition to its proprietary extraction processes including all relevant intellectual property rights.
Upon proof of concept, LANXESS is prepared to provide funding to the joint venture to allow for commercial development of the future commercial project, and it is anticipated that the joint venture will include options for Standard Lithium to participate in project funding on similar terms.
By partnering with a global specialty chemical company like LANXESS which operates three (3) brine processing facilities in south Arkansas, Standard Lithium (TSX.V:SLL) (OTC:STLHF) brings a level of expertise that significantly raises the probability for successful commercial production. The partners provide access to large volumes of brine, extensive infrastructure, and an skilled workforce-saving Standard significant time and capital to it would've taken to secure independently.
Standard Lithium has already drawn and sampled multiple tanker trucks' worth of brine for extraction process work, and the team has put in significant geophysics work, and resource modelling.
Through additional agreements with independent oil and gas producers Standard Lithium has access to previously drilled wells in and immediately adjacent to the project from which to gather new, high quality lithium brine samples from the key brine production zones in the Smackover Limestone Formation. A sampling program conducted in Q3 2018 yielded lithium grades ranging from 347- 461 mg/L
South Arkansas is North America's most prolific brine producing and processing region and has successfully been producing bromine and related compounds for more than five decades. The unique brine formation in South Arkansas is the second largest brine reserve in the world. Historical data on the project area shows 50-424 mg/L lithium in brines. The state of Arkansas currently produces the equivalent of 42.6 million m3 of brine per year-roughly 9,380,000,000 gallons, or over 35.5 billion litres.
Standard Lithium has put together a significant domestic lithium brine opportunity. Through its novel approach to production, the company has a vision of how to lop off all types of types of delays and technical issues, by how it and where it chooses to produce-Just what the United States and the rest of the USMCA needs right now.
Standard Lithium's (TSX.V:SLL) (OTC:STLHF) strategy to leverage existing brine production and piggyback on infrastructure as a shortcut in the development time to produce commercial amounts of battery quality lithium materials that could help North American manufacturers secure supply of a critical mineral. With access to extensive operations, amble power, water, low cost chemical reagents, and a trained workforce, Standard Lithium is an example of one developers novel approach to how critical mineral needs can be better met domestically.
Along with lithium, domestic manufacturers will need cobalt, vanadium and other critical metal supplies to be secured. Those supplies may come from within, or from technological advancements of North American companies abroad.
Additional Energy Metals Developments
For vanadium, a leading contender for North America's next source could come from Prophecy Development Corp. (TSX:PCY) (OTC:PRPCF). Located in Nevada, Prophecy's Gibellini Project is the only large-scale, open-pit, heap-leach vanadium project of its kind in North America. The Gibellini project has the largest NI 43-101 compliant measured and indicated primary vanadium resource known in the USA. The company recently signed a Memorandum of Agreement with the Bureau of Land Management to expedite Gibellini permitting efforts.
United Battery Metals (OTC:UBMCF)(CSE:UBM) recently named former Senior Geologist for GoldCorp, Michael A. Dehn as President and CEO. UBM continues to develop its Wray Mesa Project in Montrose County, Colorado which based on historical records appears to have a very-good to excellent potential to host in excess of 500,000 pounds of uranium-vanadium resources- with 1,620,000 pounds (0.95% avg. grade) and 1,014,000 pounds (0.88% avg. grade) historical indicated and inferred resources, respectively.
On its underground work program at the Skroska Nickel-Cobalt Mine in Albania, European Electric Metals Inc. (TSXV:EVX) (OTCPK:EVXXF) updated the market by laying out its upcoming underground work program. Geologists are onsite, and have commenced an underground sampling program, with approximately 200 channel samples expected. The project has a remaining
International Battery Metals Ltd. (CSE:IBAT) (OTC: RHHNF) recently announced a licensing agreement with Ensorica Metals Corporation and its wholly-owned subsidiary, Sorcia Minerals LLC whereby IBAT will license its novel lithium extraction technology to Sorcia for use in extracting Lithium Carbonate from lithium bearing brine sources in Chile. The technology is designed to extract lithium without the use of traditional evaporation ponds.
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