Lake Resources NL (ASX:LKE) (OTCMKTS:LLKKF) has drilling underway to support a doubling of future planned production at its flagship Kachi Lithium Project in Argentina.
The program aims to upgrade Kachi’s 4.4 million tonnes lithium carbonate (LCE) total resource from measured and indicated resources to reserves for a definitive feasibility study and production expansion study.
Lake has set in motion a four-well, 1,600-metre diamond drill program, with brine sampling and pump testing, and has an option to extend the program given all equipment is on-site.
Conversion of resources
The Kachi Project covers 74,000 hectares of leases over salt lake south of Livent Corp’s (NYSE:LTHM) lithium operation in South America's Lithium Triangle in northern Argentina.
Currently, less than 20% of the current total resource is utilised for the planned 25,500 tonnes per annum lithium carbonate production over 25 years.
Therefore, drilling will enable Lake Resources to convert inferred resources to the measured and indicated categories, to allow a production expansion study to be conducted.
“Accelerating demand”
Managing director Steve Promnitz said: “Argentina has become the key focus for lithium investment and Lake Resources 100%-owned projects are perfectly positioned to benefit, amid accelerating demand for battery quality lithium.
“Interest continues to increase among potential offtakers to secure supply, especially of a premium product with ESG benefits which Lake can produce thanks to its sustainable direct extraction process.
“This drilling program will support an expansion study to double production to 50,000 tonnes per annum.
“This would make Kachi a globally significant producer and one of a few that can bring high purity lithium carbonate to market consistently with a low carbon footprint - perfect for the needs of leading EV makers.”
Increased investment
There has been increased investment in Argentinian lithium projects, including Ganfeng Lithium’s (SHE:002460) planned development of a lithium-ion battery factory in Jujuy Province and another 20,000 tonnes per annum LCE lithium project at Marianas.
In addition, German automaker BMW has a A$447 million contract with Livent to source lithium from Argentina.
Promisingly, Argentina’s government has flagged plans to incentivise further production of lithium, with the government identifying a potential resource of some 350 million tonnes LCE.
- Ephrems Joseph