CHARTS: EV battery metals bill sets new low as lithium, nickel, cobalt price slump continues
The raw materials bill for the average EV is now down to $510 compared to a peak of more than $1,900 at the beginning of last year.
Bradda Head Lithium (TSXV: BHLI; LSE: BHL) says an updated resource estimate at its Basin project in Arizona increases its grade by 30% and earns it a $2.5 million royalty payment.
The sedimentary clay project hosts 17 million indicated tonnes grading 940 parts per million (ppm) lithium and 3.4% potassium for 85,000 tonnes lithium carbonate equivalent (LCE) and 570,000 tonnes potassium, Bradda Head said in a release on Thursday.
The British Virgin Islands-based company added 729,000 tonnes of LCE to the inferred resource and increased its grade by nearly a third to 900 ppm from 694 ppm, compared with an estimate released in October last year. The new total is 210 million inferred tonnes and 2.8% potassium for 1 million tonnes LCE and 5.8 million tonnes potassium.
Passing the 1-million-tonne threshold triggers the payment from Lithium Royalty (TSXV: LIRC) and puts it on a path to earn $3 million more on reaching 2.5 million inferred tonnes LCE.
The inferred resource increased from 371,000 tonnes LCE with only about 2,300 metres in new drilling and using a cut-off grade of 550 ppm vs 300 ppm a year ago, Toronto-based Red Cloud Securities said in a note on Friday.
“We view this update positively as management continues to advance its projects as promised and achieves set milestones,” mining analysts Alina Islam and David Talbot said. “Given the increased geologic understanding of the deposit, with successive drilling Basin could reach the 2.5-million-tonne milestone as early as 2024.”
The Upper Clay unit, one of three levels at Basin, has an average grade of 1,300 ppm lithium and thickness of 15 metres. It could form part of a phased open-pit mining operation that would enhance the project’s economics, Bradda Head said. Mineralization is open to the north of the resource area where more drilling is planned for next year, it said. So far, drilling has covered 2.5-sq.-km of the 41-sq.-km site.
“We remain well funded, even more so following the royalty payment,” Bradda Head chairman Ian Stalker said in the release. “We have a compelling 12 months ahead with what we believe are a number of material catalysts.”
Last year’s estimate showed Basin held 17.6 million indicated tonnes grading 912 ppm lithium and 3.4% potassium for a total of 85,000 tonnes LCE. The inferred amount was 57.6 million tonnes at 717 ppm lithium and 3.3% potassium for a total of 220,000 LCE.
Shares in Bradda Head were unchanged on early Friday afternoon, valuing the company at C$19.5 million.
Bradda Head also has the San Domingo hard rock project in Arizona and the Eureka and Wilson Salt Flats brine projects in Nevada.. In February, the company reported hole SD-DH22-024 at San Domingo cut 31.85 metres grading 1.6% lithium oxide (Li2O), including 3.21 metres at 3.74% Li2O.
“The market remains focused on the pending drill results from its San Domingo pegmatite project,” Red Cloud said. “Previous drill results have returned high grades and demonstrated district scale potential.”
