ACME Lithium Inc. (CSE:ACME, OTCQB:ACLHF) has reported sample results from the recently drilled DH-1 hole at its Clayton Valley lithium brine project in Nevada, revealing a “significant new lithium discovery".
DH-1 was drilled to a total depth of 1,400 feet below ground surface and intersected multiple productive horizons including the targeted basal gravel aquifer at an approximate depth of 1,250 feet below ground surface, the company said.
Following the discovery, ACME has initiated Phase 2 planning and procured an expanded drilling and pump test program.
READ: ACME Lithium kicks off phase 2 field work at Fish Lake Valley project in Nevada
Samples of brine were taken from DH-1 at various intervals and sent to an independent lab, where they were analyzed for lithium and other elements typical of lithium-enriched brine systems, the company said.
Target sampling zones and depths were based on the results of geophysical surveys, interpretations of the drilled lithology, and field observations including fluid conductivity and salt precipitation on the exposed core.
Specifically, lithium was detected in all brine samples at concentrations ranging between 38 and 130 milligrams per liter (mg/L), and boron was detected in all brine samples at concentrations between 16 and 39 mg/L.
This strongly indicates a bicarbonate-rich groundwater quality affinity, the company said, which is typical in the Clayton Valley lithium brine aquifers.
Additionally, lithium concentrations appear to increase in the vicinity of the deeper lacustrine tuff unit at 1,180 feet below the surface and increase further to 130 mg/L in the deep gravels underlying the tuff near the bottom of the hole, the company noted.
Looking forward, geologic and geophysical data will help identify specific horizons to be tested in a Phase 2 drill program, which the company said will include a separate, larger diameter test well for the completion of brine aquifer permeability testing and sampling.
Phase 2 will also include up to three new exploration holes with the goal of examining deeper horizons through zonal isolated testing. The exploration holes will be completed with grouted-in vibrating wire piezometers, which will be used to monitor aquifer response during pumping tests.
ACME expects to begin Phase 2 in the fourth quarter of 2022.
Red Cloud analysts like what they see
Following ACME's announcement, analysts at Red Cloud said in a note to clients that the firm is likely to increase its price target for the company.
"ACME’s maiden drill hole encountered multiple prospective horizons that were enriched in lithium," analysts said. "Based on what we know about ACME’s neighbors’ project, Albemarle's Silver Peak operation, we believe the grades encountered by ACME have potential to be economic. We expect an upward re-rating of ACME’s share price on the back of the company transitioning from pre-discovery to early-discovery stages."
—Updated to include Red Cloud analyst commentary—
Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com
Follow him on Twitter @andrew_kessel