Lithium Energy Ltd (ASX:LEL) has brought in what it’s calling a significant maiden mineral resource (MRE) at the Solaroz Lithium Brine Project in Argentina.
This resource estimate – registering at 3.3 million tonnes of lithium carbonate equivalent (LCE) – establishes Solaroz as a highly strategic lithium asset, given its substantial size and proximity to the Olaroz lithium brine production facilities owned by Allkem Limited.
Location advantage
The project's location on the Olaroz Salar in northwest Argentina, part of the renowned Lithium Triangle in South America, adds to its appeal.
LEL's maiden resource estimate includes a high-grade core of 1.34 million tonnes of LCE with an average lithium concentration of 405 mg/l at a 350 mg/l lithium cut-off grade.
This initial resource estimate is based on the drilling of five holes within a 4,777-hectare area identified by TEM geophysics as having elevated conductivity representing brine.
The company plans to continue drilling with three rigs on-site to target upgrades to the resource within the remaining 12,000-hectare area at Solaroz.
Infill drilling is also scheduled to upgrade the resource from the inferred category and test production wells will be installed to support engineering and technical studies related to the commercial development of Solaroz.
World-class lithium play
Executive chairman William Johnson said: “This maiden resource estimate of 3.3 million tonnes of LCE confirms the potential for Solaroz to be a world-class lithium project, with reported lithium grades, brine volumes, magnesium/lithium ratios and specific yields all being positive indicators for the potential economic future brine extraction at Solaroz.
“Solaroz is located on the Olaroz Salar (salt-lake) in northwest Argentina, one of the best locations in South America’s Lithium Triangle for developing large-scale lithium brine operations, as evidenced by our Olaroz neighbours Allkem and Lithium Americas.
“Allkem has reported production of lithium carbonate from Olaroz since 2015 using traditional brine evaporation, with latest reported cash costs of only US$4,924/tonne LCE and reported gross cash margin of US$47,814/tonne LCE.”
While the five drill holes completed so far are mostly concentrated along the eastern boundaries of the Central Block of concessions, further drilling will test the hypothesis that lithium concentrations decline in the north and west directions away from the Olaroz Salar.
Unexplored potential
The northern block of concessions and the western areas of the Central Block remain unexplored and present potential for additional brines, as indicated by previous geophysical surveys.
Lithium Energy is actively progressing its drilling program to target these unexplored areas. In addition, the company plans to conduct infill drilling to upgrade the inferred resource category and install test production wells.
These activities align with the ongoing engineering and development studies at Solaroz, including the construction of a 3,000-tonne-per-annum LCE production plant at the Mario Angel concession in partnership with Xi'an Lanshen New Material Technology Co., Ltd.
Hatch to develop scoping study
The company has also engaged engineering consultancy Hatch to prepare a scoping study for the production of battery-grade lithium carbonate from the lithium-rich brines at Solaroz.
The study will evaluate traditional pond evaporation and direct lithium extraction (DLE) technologies. The high-grade core within the 3.3 million tonnes of LCE resource surpasses the average lithium concentration being used in the scoping study for a proposed pond evaporation plant at Solaroz.
Having established this significant maiden resource, Lithium Energy is determined to expedite the development of the Solaroz project.
Ongoing drilling activities will target additional areas of potential mineralisation, while infill drilling and test production wells will further optimise resource estimation and support engineering and development studies.