Its a very exciting time for the lithium sector as electric cars become the new luxury vehicle. Tesla (NASDAQ:TSLA) has released a model that is more economically suitable for a middle class lifestyle with the Model 3.
Keep a close eye on Bearing Lithium Corp (V:BRZ) who may soon have a major position in possibly the highest grade undeveloped lithium brine asset in the world. Its close to double the grade of the top lithium projects in Argentina.
So the question is why is Bearing Lithium so cheap if they could soon own a piece of the top development project in the most exciting commodity?
Bearing is in the process of a complex cross border merger with Lithium Consolidated Mineral Exploration Ltd (AX:LI3) which they expect to close by the end of the summer. Once that is done I expect the many who are waiting on the sideline to enter. Remember having a high grade salar like this can possibly make a huge difference with capex as you have to move less waste.
There has been so much money invested in this project already around $25 million. Bearing should be fully carried through feasibility. This means minimal dilution for existing shareholders.
Bearing just released an updated JORC resource estimate from the Maricunga Project in Chile which demonstrated that it is one of the highest grade undeveloped lithium brine projects in the world. The resource has tripled in size nevertheless the high grades are maintained. The new resource could be just a starting point as they move closer to feasibility in the first half of 2018. Flow rate tests showed that extraction by pumping is strong.
Bearing Lithium CEO Jeremy Poirier stated in the news release,
“We are extremely pleased with the updated JORC resource estimate completed by the Maricunga joint venture under the direction of the project operator, Minera Salar Blanco (MSB). This resource estimate demonstrates the true potential of this world-class project. The results have significantly increased the size of the resource, confirmed the grade, and demonstrated the continued existence of exploration potential. M&I grades of 1,100 mg/L Li and Inferred grades of 1,300 mg/L Li rank Maricunga as the highest-grade pre-production lithium brine project worldwide. Development activities remain on schedule with process test work, preliminary engineering and design advancing towards a Pre-Feasibility Study (PFS) anticipated later this year and a Definitive Feasibility Study (DFS) in H1/18,”
I expect Chile to possibly make some moves that promotes lithium development. Its a strategic metals in Chile and Albemarle was granted the right to expand their operation. Bearing has grandfathered concessions which could hopefully help them start processing lithium.
In addition to having this world class asset they also have a CEO who founded Pure Energy (V:PE) and helped facilitate a deal with Tesla. Bearing’s VP Corp Dev used to be an analyst for lithium at Haywood so that means he could probably open some doors at some big funds.
The CEO and Chairman of Li3 is on the Board of Bearing in advance of closing the cross border merger so that is a huge vote of confidence. Financially, Bearing has around $2 million CAD in the bank and treasury should be growing with in the money warrants. The stock is breaking out and bouncing off the 50 DMA. This may be what some technicians call a secondary accumulation opportunity from its initial run up to $1.80.
Disclosure: I have a conflict of interest as I own Bearing and they are a website sponsor which means I have been compensated. That makes me biased. This should be considered an advertisement with forward looking statements which may not come to fruition as small cap investing is incredibly risky. I may buy and/or sell at anytime. Do your own due diligence as this is not financial advice. I am not a registered financial advisor. I may buy/sell shares in these stocks at any time. Please be aware.
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