American Lithium Corp (CVE:LI, OTCQB) appears to have moved up a gear in 2018 and is now steeping up plans for its exciting Fish Lake Valley (FLV) project in Nevada, where it has a commanding land position.
On July 25 this year, it announced plans for a private placing to raise up to C$4.5mln to advance the project via lithium brine and claystone drilling programs.
It said the cash would also be used by the group for future acquisitions, marketing and general working capital.
This month, the Toronto-listed firm said it was stepping up development at FLV against the backdrop of a resurgence of interest in US lithium production.
The lithium market is pretty buoyant at the moment. Analysts reckon that the lithium juniors of today (like this one) won't be in production un til around the mid 2020s, which is when the electric vehicle [EV] and energy storage markets should really be booming.
Prices are also holding their own and higher than last year with global lithium carbonate equivalent [LCE] contract prices around US$16,000 per tonne - up about 20% on 2017 prices.
So what is the Fish Valley asset?
The wholly owned project now consists of 22,332 acres of mineral claims, which are prospective for lithium in brines, clays and claystones, and the firm has been pursuing early stage exploration since 2016.
After a C$4.2mln financing earlier this year, American Lithium acquired an additional 3,575 acre parcel in the valley, which is called the Gap-Lode project, comprising 167 claims.
It is worth noting that the property is just 3.5 hours from the Tesla (NASDAQ:TSLA) Gigafactory and lies around 20 miles from Albemarle Corporation’s Silver Peak project- the only producing lithium mine in the United States.
As the demand for lithium batteries grows, driven by the demand for electric vehicles and ever-larger power storage capacity, the company aims to be a part of the increasingly high-value supply chain.
Lithium is among 23 metals President Trump recently deemed critical to national security, and signed a bill that would encourage the development of new US sources of these metals.
The aim at FLV is to continue to prove the resource.
Significant milestones already achieved
Sampled near surface lithium brines up to 300 mg/l (miligrams per liter) Li
3D model delivered excellent targets for deeper basin exploration
Claystone identified to the South and east of basin.
3D basin model driving land acquisition of additional claystone targets
Stepping up development
In June this year, the firm began a geologic and geochemical study of the Gap-Lode project to identify and prioritize target zones for auger sampling, trenching and drilling.
Field crews are onsite surface trenching and mapping the extent of outcropping lithium claystones.
So far, American Lithium's exploration at the site has included 200 shallow auger holes with results up to 300 ppm (parts per million) lithium in the brines and it has sampled over 1000 ppm lithium in the surface playa sediments.
Experienced CEO
Chief executive Michael Kobler has brought major projects into production in the past, so if any of the company’s projects do go all the way, they should be in safe hands.
However, it’s likely that any American Lithium asset which has demonstrated real economic potential will be snapped up long before then.
Shares, like many stocks in the sector, have had a volatile year but American Lithium shares have had a good run in July, up around 31% on the month to C$0.46 currently.
This could certainly be one share to watch.