Lithium has the highest electrochemical potential of any metal, an extremely high co-efficient of thermal expansion, fluxing and catalytic characteristics, and low density. Lithium is highly sought after for a range of industrial uses, in particular energy storage where it is a vital component of most popular battery electrolytes and electrodes. A high charge and power to weight ratio makes lithium ideal for applications where weight is a significant consideration (e.g. electric vehicles, mobile phones, hand tools, drones and robots).
In June 2018 Jindalee announced the acquisition of two lithium sediment projects in the United States, at McDermitt and Clayton North. These projects are 100% wholly owned by HiTech Minerals Inc., a wholly owned, US based subsidiary of Jindalee and were generated by Jindalee after an extensive search across Nevada, Arizona and Oregon. For more detail please see our recent ASX releases here.
Jindalee was attracted to the projects by several factors:
- the mineralisation style has the potential for large scale, long life sources of lithium that sit at the lower end of the global cost curve;
- the projects are located in a mining friendly jurisdiction with significant domestic lithium demand currently satisfied by imported material; and
- there is the opportunity for Jindalee to rapidly advice the projects through the exploration stage at relatively low cost.
Lithium is found in pegmatites, brines and sediments. Lithium bearing sediments at Jindalee’s McDermitt Project have several positive characteristics including:
- Mineralisation is from surface, flat lying to shallowly dipping with low to non-existent stripping ratios.
- Contained within soft rocks suggesting low cost mining.
- Favourable metallurgy – initial testwork has indicated high lithium recoveries from conventional sulphuric acid leaching at low temperature and atmospheric pressure.
- The economics of advanced sediment projects demonstrate the costs to produce lithium compounds used in battery manufacture are highly competitive.
- An adequate scale potential to support a long mine life.
Increasing domestic demand and energy security goals make the USA an ideal location for development of lithium projects:
- Growing local demand is currently satisfied by imported material with the Silver Peak mine owned by Albermarle Corporation (NYSE: ALB) the only operating production facility in the US.
- The USA is politically stable, with excellent infrastructure and a skilled labour force.
- Executive Order ‘Federal Strategy to Ensure Secure and Reliable Supplies of Critical Minerals’ signed by President Trump on 20 December 2017 makes the development of lithium projects in the U.S.A. a focus for Federal agencies.
- US Department of the Interior report June 2018 includes Lithium as critical to economic and national security.
- Bipartisan Bill ‘American Minerals Security Act’ introduced May 2019 to secure mineral resources and reduce reliance on foreign sources.
- A domestic source of Lithium would not be subject to tariffs.
- 100% owned tenure, with no royalties.
The Clayton North project is located 23km north of the only producing lithium operation in the USA at Silver Peak. Extensive areas of lithium (Li) bearing claystones outcrop within the claims area, and have returned assay results of up to 930 ppm Li in sampling by the Company’s geologists. The project is ideally located in close proximity to the only lithium producing operation in the U.S.A.
With title to the claims now confirmed, Jindalee is working to obtain the necessary permits and approvals to allow drill testing of the project area. The proposed drilling program is designed to follow up the encouraging values returned from initial surface sampling of weathered material and test for extensions to lithium mineralisation beneath the thin cover observed in the northern part of the claim area. Samples of the oxide material have also been submitted for initial metallurgical testwork to test the amenability of the lithium bearing clays to simple leaching.
Excellent results from the initial drill program completed at McDermitt in September 2018 underpinned a significant exploration target and positive outcomes from subsequent metallurgical test work have given Jindalee the confidence to undertake follow up drilling which was completed in September 2019. Assay results used in the estimated of the Exploration Target were of sufficient scale to demonstrate that the McDermitt Project has the potential to host one of the largest lithium deposits in the USA.
The Company has maintained a steady, incremental approach to de-risking the McDermitt project at low cost, progressing from surface sampling results, through initial drill testing and metallurgical testwork to the current drill program to support estimation of a maiden mineral resource and update to the existing Exploration Target range.
Jindalee has established that the scale of McDermitt is significant and that the lithium can be extracted using conventional means. Jindalee is currently focussed on defining these parameters in more details and to a higher level of confidence, with further significant project updates anticipated over the coming year.