Investors are fixed on the EV battery market to see what’s next and one high-grade company has been standing out from the pack.
Where are lithium investors putting their money?
In a recent development that underscores the enduring value of lithium projects despite market fluctuations, Lithium Americas (Argentina) Corp. (TSX:LAAC) has sealed a significant agreement with a subsidiary of Ganfeng Lithium Co. Ltd., a major player in the global lithium market. The deal entails Ganfeng Lithium acquiring US$70 million worth of newly issued shares of Proyecto Pastos Grandes S.A. (PGCo), representing an approximate 15 per cent interest in the Pastos Grandes project located in Salta, Argentina. This transaction, valued at US$470 million, highlights the ongoing interest and investment in lithium ventures despite the recent downturn in lithium commodity prices. Lithium Americas Corp. (NYSE: LAC TSX:LAC) of course is focussing on its widely acclaimed lithium resource, Thacker Pass Lithium Project, in Northern Nevada – which is said to be the largest known Measured and Indicated Lithium Resource in North America with 1,457.2 million tons of Measured and Indicated Lithium Reserves at an average of 2,070 Li (ppm) totalling 16.1 million tons of lithium carbonate equivalent.
This agreement serves as a compelling reminder to investors that despite the current market conditions, transactions in the lithium space continue to be robust and hold substantial value. It also emphasizes the strategic importance of lithium assets, particularly those with significant potential for production and growth.
Drawing parallels, this transaction prompts a comparison with companies also operating in Northern Nevada like Grid Battery Metals Inc. (TSXV:CELL) and their endeavors in the lithium sector at its Texas Spring Lithium Property, which borders Surge Battery Metals Inc.’s (TSXV:NILI) Nevada North Lithium Project. Surge recently announced a mineral resource estimate of 4.67 million tons lithium carbonate equivalent grading 2,839 parts per million (ppm) lithium at a 1,250 ppm cutoff at its Nevada North lithium discovery.
While Lithium Americas focuses on projects in both Argentina and Nevada, Grid Battery Metals focuses in North America with its three lithium projects in Nevada. Grid is making significant strides to develop these high value targets towards a viable lithium resource within North America.
Grid Battery Metals’ Clayton Valley Lithium Project
Grid Battery Metals’ work in the state, particularly its Clayton Valley Lithium Project, positions the company as a promising contender in the lithium market. Recently filing an NI 43-101 Technical Report on its Clayton Valley Lithium Project, Grid Battery Metals showcases its commitment to transparency and adherence to industry standards, enhancing investor confidence in its operations.
“The recommendation for future exploration ultimately includes a drilling program as a logical next step here on the property. The timing is good for the company, and with approximately C$7.0 million in our treasury, we are well-positioned and fully funded for our 2024 exploration season,” The company’s president and CEO, Tim Fernback commented in a news release. “Clayton Valley holds the only producing lithium brine system in the United States and holds amazing potential for lithium clay-hosted deposits. Our lithium claims in Clayton Valley are bordering the Silver Peak Lithium Project of Albemarle Corp. (NYSE:ALB), home to the only producing lithium mine in North America. Previously, Albemarle Corp. announced that it will continue to invest in its Silver Peak Lithium mine in order to double lithium production by the year 2025. Another neighbour of ours to the east, Century Lithium Corp. (TSXV:LCE), has issued a pre-feasibility study referencing a 26 per cent after-tax internal rate of return and an NPV8 of $1.03 billion. Furthermore in May 2023,Nevada was ranked again as the #1 Mining Jurisdiction in the world by the Fraser Institute, a position it has held several times in the recent past. Our plan at Grid is to realize the potential of this area of Nevada for lithium-hosted brine and claystone for our shareholders.”
What sets Grid Battery Metals apart is the proximity of its Texas Spring Lithium Project to Surge Battery Metals’ Nevada North Project, known for its record high-grade lithium clay deposits, AND the proximity of its Clayton Valley Lithium Project to Albemarle’s very active Silver Peak Lithium Mine. This geographical advantage places Grid Battery Metals in a prime position to capitalize on the burgeoning lithium demand, especially within the United States, a market poised for significant growth in the electric vehicle sector.
In an update on March 13, 2024, Grid announced the start of its 2024 exploration program as identified in the NI 43-101 technical report. Soil sampling will begin immediately and will be conducted by Rangefront Geoligical, a company with in-depth expertise and cutting-edge technology. A CSAMT survey will begin on March 18, 2024 conducted by experienced operator KLM Geoscience.
Grid Battery Metals’ strategic location, coupled with its focus on high-grade lithium clay deposits, positions the company as a compelling investment opportunity. With the lithium market poised for resurgence and the increasing emphasis on domestic supply chains, Grid Battery Metals stands out as an undervalued player with significant growth potential.
Investment corner
With a market cap of just C$9.4 million, Grid Battery Metals appears to be undervalued in comparison to its peers, making it a compelling investment opportunity for investors looking to capitalize on the growing demand for lithium.
With a robust project portfolio, including the Texas Spring Lithium Project and Clayton Valley Lithium Project, and strategic positioning in proximity to key lithium assets, Grid Battery Metals offers investors a unique opportunity to capitalize on the growing demand for lithium in the renewable energy and electric vehicle industries. As the lithium market continues to evolve, Grid Battery Metals is poised to emerge as a key player, delivering value to shareholders in the long term.
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