LITHIUM X ENERGY C COM NPV (OTCMKTS:LIXXF) is a micro cap chemical play that remains a top-play on the OTC. Lithium prices started to move about a year ago when investors realized this was a key mineral for electric cars, and there was not enough of it on the planet. (OTCMKTS:LIXXF) was early to this party, and the initial issuers in the stock were old hands at recognizing a trend when they saw it. These Canadians were not new to the Mining and Mineral sector and were coming out of the backend of a long decline in that sector. Lithium was like a breath of fresh air, and the team at LIXXF pounced as shares moved from pennies to dollars.
The company itself is in lithium exploration and development with the goal of becoming a low-cost supplier for the burgeoning lithium battery industry. Lithium X owns 50%, and has the option to acquire up to 80%, of the Sal de los Angeles lithium brine project in the prolific “Lithium Triangle” in mining friendly Salta province, Argentina. Lithium X’s Arizaro project consists of 33,846 hectares located in one of the district’s largest salars known to contain elevated lithium brine values.
LITHIUM X ENERGY C COM NPV (OTCMKTS:LIXXF) is also exploring a large land package in Nevada’s Clayton Valley, contiguous to the only producing lithium operation in North America – Silver Peak, owned and operated by Albemarle, the world’s largest lithium producer. Lithium X is listed on the TSXV under the trading symbol LIX.
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LithiumX also recently announced they received permits for the construction of the initial ponding facility to be constructed as part of the Salta Exploraciones S.A. Joint Venture. The facility is designed for an output of approximately 2,500 tonnes per annum of lithium carbonate equivalent. The permits allow for the construction of brine collection, pumping, piping and ponding facilities consisting of 62.6 hectares of lined ponds, designed to produce a high-purity 5% lithium concentrate, at the Company’s flagship Sal de los Angeles project in Argentina.
The JV ponding facility will cover a maximum of 100 hectares (approximately 1%) of the 8,156 hectares that comprise the Sal de los Angeles property. Construction activities will begin immediately. The Project has not been the subject of a feasibility study and there is no guarantee the Facility will successfully produce a commercial product on a profitable basis or at all.
“We would like to thank the Province of Salta and respective regulatory authorities for their assistance and cooperation in the granting of this permit,” commented Paul Matysek, Executive Chairman. “This is a key milestone for our Company and will certainly strengthen and differentiate our status in a very crowded lithium sector. We look forward to working closely with the local authorities and workforce in developing sustainable environmental, work and social programs to ensure we develop the Facility in harmony with the Puna region.”
“The receipt of construction permits for our Facility is a major landmark for Lithium X and our joint venture with SESA,” commented Brian Paes-Braga, Chief Executive Officer “We are on the cusp of obtaining our first 5% lithium concentrate from our pilot pools on site. This is a high purity brine concentrate that could serve as feed to existing or new battery grade lithium carbonate and/or lithium hydroxide plants. We have already been approached by several end users of the expected concentrate and look forward to initiate testing with downstream partners.”
Under the terms of the JV Agreement, to earn a 50% stake in the JV Company, SESA must contribute an estimated US$6 million or the required amount for the construction and operation of an initial 2,500tpa LCE ponding facility by incurring all construction costs, including one full year of post-construction operation. Potasio y Litio de Argentina S.A. (“PLASA”), of which Lithium X has the right to earn 80% and is 100% owner of SDLA, shall contribute US$3.3 million for a 30% contributing participation in the JV and the right to commercialize the lithium products.
In addition, PLASA is also fully carried for the remaining 20% for contributing brine from existing wells on the Project, including a free-flowing artesian well that is expected to supply the operation initially.
Many Lithium stocks had this initial move, and LIXXF prices settled into some range trading settling recently in the $1.40 area, and had a selloff in March. Recently LIXXF shares have rallied back to the $1.50 + end of the trading range. The real test for these stocks will be when they start to deliver actual Lithium from the ponding process to clients and partners. We think noting important bottoms and tops and understanding the trading ranges (the real valuations) are as important as any fundamental news. For more news on LithiumX and other fast-moving penny stocks, please subscribe to OracleDispatch.com below.