IGO suspends annual dividends from Tianqi JV amid market downturn
The JV experienced a build in lithium hydroxide inventory at Kwinana over recent months.
Patriot Battery Metals (TSX-V: PMET) (ASX: PMT) has delivered the long-awaited maiden resource estimate for the CV5 pegmatite at the Corvette lithium project in James Bay, Quebec, saying that results confirm the asset as the largest lithium pegmatite mineral resource in the Americas and the eighth largest globally.
The initial resource estimate indicates the deposit holds 109.2 million tonnes at 1.42% lithium oxide and 160 parts per million tantalum, for 1.55 million tonnes of contained lithium oxide, or 3.83 million tonnes of lithium carbonate equivalent, using a 0.4% lithium cut-off grade.
Using a 1.4% cut-off, CV5’S resource is 46.3 million tonnes at 2.03% lithium oxide or 3.84 million tonnes of contained lithium carbonate equivalent. The figure, though below some analysts’ estimates, is strong enough to disprove criticism divulged by short seller firm Night Market Research.
Shares cratered despite the positive announcement, dropping over 6% in Australia, about 5.5% in New York and 5.9% in Toronto on Monday.
“We could not be happier with the result of this maiden mineral resource estimate at CV5, which will be the first of multiple resource estimates for the Corvette Property over the coming years,” Patriot CEO Blair Way, said in the statement.
Albemarle, the world’s largest lithium producer, decided to seize the opportunity, offering on Tuesday C$109 million ($82.6 million) to Patriot for a 5% stake in the company.
Albemarle will subscribe around 7.1 million Patriot shares at an issue price of C$15.29 per common share under a subscription agreement. The issue price represents a 7% premium to the stock’s July 31 closing price on the TSX Venture Exchange.
Way noted the publication of the first resource for CV5 was his is a “key milestone” for the company, which will underpin future economic and development studies as Patriot looks to aggressively advance the asset on to production.
The resource and geological modelling has outlined significant potential for growth at CV5, which remains open at both ends along strike, and to depth along a significant portion of its length, the company said.
Upon closing of Albemarle’s investment, Patriot will enter into a non-binding pact with the US-based miner to study the viability of a downstream lithium hydroxide plant integrated with Corvette.
Rumours of Australian players eyeing Patriot as a potential acquisition target have been circulating in Australian media on and off this year. In February, it was said that Mineral Resources, Pilbara Minerals and Wesfarmers were all interested in buying the Canadian minor or, at least, a stake in it.
Australian lithium miners, such as Pilbara Minerals, Orocobre and Galaxy Resources are all looking to expand their global footprint and diversify their supply sources amid rising demand for battery metals. Analysts say they see Patriot Battery Metals as an attractive opportunity to gain access to the North American market and secure long-term supply contracts with leading battery manufacturers.
Quebec has become a hard rock lithium hotspot as companies vie to supply the surging electric vehicle market. The federal government approved the James Bay open-pit project by Galaxy Resources, a division of Allkem (TSX: AKE; ASX: AKE), in January.
Azimut Exploration (TSX-V: AZM) has its own James Bay project and Sayona Mining (ASX: SYA) expects the first spodumene shipment from its North American Lithium operation to take place this month.
