Research Report by Hallgarten & Company
Sydney, Jan 30, 2018 AEST (ABN Newswire) - Chilean Lithium prospects have been relatively overshadowed in recent years by the rising Argentine Lithium scene. This has been because the Chilean scene was perceived to be locked up between the majors of the now moribund "cartel" and because there were a plethora of undeveloped salares on the Argentine side of the Andes. However in a case of quality over quantity the Chilean side had relatively few available areas to stake but has more ideal climatic conditions and better access and infrastructure. It was this aspect that prompted Lithium Power International (
ASX:LPI) (LTHHF:OTCMKTS) (LPI) to farm out its Argentine assets and focus its attentions on the Salar de Maricunga JV.
The salar that Lithium Power International intends to exploit lies at over 3,750 metres above sea level near to the Argentine border in the high Atacama desert, one of the driest places on the planet, with attendant advantages for evaporation rates, while enjoying the heightened confidence that investors have in the Chilean mining regime. The recent Chilean presidential elections also resulted in a swing towards a more business-friendly regime with a President with past connections to the mining sector having been elected.
The project had been long mired in the financial misfortunes of a TSX-listed entity called Li3 Energy which had lacked the funds to advance the project beyond some initial exploration that petered out several years ago. Meanwhile exploration of the rest of the salar was non-existent as it was held by the long disinterested majors, CODELCO and SQM. This has changed in recent times with CODELCO (the massive state-owned copper miner) having decided to energise interest in its holdings on the salar by putting them out to public tender.
LPI signed its JV earn-in agreements relatively recently (in the second half of 2016) and has since been in a frenzy of upgrading data and "mine"-planning that has taken it in just over year to the point where a production decision is within sight and the project is in a state that potential offtakers can have confidence that Maricunga is one of the real projects in a universe of over-promoted projects that have little prospect of coming to fruition.
In this review we shall go over the specifics of the project and the dynamics of Chile without reiterating the obvious on the current evolution of the Lithium demand space.
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About Lithium Power International Ltd
Lithium Power International Limited (ASX:LPI) is a pure play lithium company with three distinct project regions to provide diversification. One is located in South America's brine region and three are in Australia's spodumene hard rock areas of Western Australia.
The primary focus is to develop of Chile's next high-grade lithium mine on the Maricunga Salar in an area known as the Lithium Triangle. The Company has also expanded its tenement holdings of lithium exploration prospects in Western Australia.
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