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Lithium occurs at the project over an extensive area in mineral-rich brine containing 40% dissolved solids.
Lithium values as high as 1,700 ppm lithium (0.9% Li2CO3) have been sampled in historic oil exploration wells. The brine also grades as high as 7.9% potash, 18.7% magnesium chloride, 13% salt, 6,100 ppm bromine and 1,260 ppm boron. The brine was discovered in the 1960s when oil exploration wells encountered blow-outs (brine flowing at up to 1,000 gallons per minute) when drilling into Bed #31 of the Paradox Formation at a depth of 6,000 feet. The brine is known to occur over a minimum of 48 square miles and is open in all directions.
Engineering reports from the 1960s conclude that the brine reservoir is extensive and is recharged from fresh in-flows as indicated by well pressure measurements, drawdown tests and oxygen-deuterium isotopes. One historic report suggested a minimum reservoir of 15 million barrels with upside in the hundreds of millions of barrels.
A work program is being developed to obtain modern brine samples for chemical analysis and baseline/preliminary metallurgical testing for mineral extraction. Engineering characteristics of the host formation will also be tested to establish pressure, temperature, artesian characteristics, precipitation characteristics, drawdown, and potential size of the aquifer. Preliminary economic evaluation is on-going.
Brine mines are more economic to mine and process and can be put into production faster and with less CAPEX than conventional open-pit or underground mines. According to estimates by Credit Suisse, lithium produced from brine costs around $1,500 to $2,300 per ton, while lithium from hard rock mines costs $4,200 to $4,500 per ton.
Given the favorable climate of the area, solar evaporation can be used to concentrate the brine to enhance project economics. Four miles to the south of the project the Cane Creek potash mine (Intrepid Potash Corp.) has been solution mining potash beds for over 45 years and employs solar evaporation to concentrate their brine for processing.
About Lithium
- Lithium has a variety of industrial and commercial applications with the use of lithium in rechargeable batteries accounting for 20% to 25% of all lithium demand. The current global market for rechargeable lithium batteries is over $4 billion per year with demand expected to grow by 20% per annum.
- Global production of lithium in 2009 was estimated at 18,000 tonnes per annum with 90% of production coming from Argentina, Chile, China and Australia. Overall lithium demand is projected to grow at 4% to 5% per year.
- The United States currently has only one domestic source of lithium raw material: Chemetall Foote's lithium brine operation near Silver Peak, Nevada. Annual production is estimated at 1,200 tonnes of lithium from brines with lithium concentrations of 166 ppm to 1,000 ppm. Total production since 1967 is estimated at 50,000 tonnes of lithium.
- Lithium for batteries is an important part of clean energy solutions being pursued in the United States. In August 2009, the United States announced over $2.4 billion in funding for deployment of electric vehicles, batteries, and components in the United States. Chemetall Foote was granted $28.4 million to expand and upgrade the production of lithium carbonate at the Silver Peak Nevada site and to add production of very high purity lithium hydroxide at a North Carolina facility.
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