Progress at Rare Earth Minerals PLC's (LON:REM, OTC:REMMY) Sonora lithium project in Mexico continues apace - with work for a key feasibility study now started and discussions ongoing over financing.
The company has an interest in the property via its 17.19% holding in Bacanora Minerals Ltd (CVE:BCN), and added that additional technical staff were being recruited with expertise in lithium development.
A contractor has been hired to carry out infill reserve drilling, which is scheduled to start this quarter and complete in the third.
The AIM firm also told investors that Sonora's mineral resource estimate had been amended to reflect the parameters within the now filed pre-feasibility study
Rare Earth's chief executive Kiran Morzaria told investors: "Rapid progress continues to be made in advancing the Sonora Project, both regarding preparation for production and in discussions with offtake partners.
"This progress along with the excellent economics, re-affirm that the Sonora Project's emergence as low cost, market leading lithium asset.
"The filing of the PFS has also allowed us to identify the significant value to REM and its shareholders of both its indirect holdings in the joint ventures and its direct holding in Bacanora."
The resource estimate now includes slightly lower projected lithium prices and increased processing costs, and also that potassium can be recovered as a by-product.
The project now houses an indicated estimate of 259 Mt (million tonnes) averaging 3,200 ppm (parts per million) lithium for 4.5 Mt of LCE (lithium carbonate equivalent), while the inferred resource is 160 Mt averaging 3,200 ppm Li for 2.7 Mt of LCE.
REM noted that talks continue with offtake partners, banks, debt providers and strategic investors.
"The focus is on developing a project financing strategy as well as producing further battery grade lithium carbonate samples for distribution to potential partners in Asia, in Q3 this year," it said.
More than over 80 tonnes of mineralisation have been extracted for processing at the pilot plant in Hermosillo and there are plans to have offtake and project financing strategies finalised as part of the completion of the feasibility study in the first quarter of next year.