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Corporate Spotlight

Lake Resources NL (LKE) is a mineral exploration company focusing on exploration and development of lithium brine projects and lithium hard rock projects.
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Government support for Kachi lithium brine project

PRESENTATION

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LAKE EXPANDS

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LAKE EXPANDS LEASES AS THE KACHI LITHIUM BRINE PROJECT CONTINUES TO GROW

ASX Announcement 7 November 2018

  • New leases expand Lake’s 100% owned Kachi Lithium Project to 69,000 Ha, an increase of over 25%, consolidating ownership in 36 mining leases. Lake now holds over 200,000 hectares of lithium leases in Argentina. 
  • Recent drilling on platform K08 confirms +300 mg/L lithium values are present in the south and are likely to continue beneath cover based on geophysical results. 
  • Maiden exploration target shows potential for 8 to 17 million tonnes lithium carbonate equivalent (LCE) over enlarged area of 20 km x 15km with brines from surface to 400+ metres depth. The awaited initial resource estimate will only cover a small portion of the exploration target. 
  • Kachi is the lowest point of a large drainage area covering 6800 square kilometres (2500 square miles) larger than most basins where lithium brine is being extracted. The lithium bearing brines at Kachi are hosted in high porosity, permeable sandy sediments. 
  • Lake has partnered with Lilac Solutions to advance a rapid, low cost method for direct extraction of lithium from Kachi brines. The process aims to enhance the grade, reduce the lead time to production, lower operating costs and significantly increase recoveries.

Argentine-focused lithium exploration and project development company Lake Resources NL (ASX: LKE) is pleased to release new information regarding an expanded and consolidated package of mining leases covering the large maiden exploration target on Lake’s 100% owned Kachi Lithium Brine Project (See Figure 1).

Lake is releasing an exploration target over the Kachi project, as the company wishes to provide information regarding the project, while deferring the maiden resource estimate to allow incorporation of additional drilling over what is an expanding area likely to host lithium-bearing brine. In recognition of the expanding footprint of the project, further mining leases have been applied for, increasing holdings by more than 25% to 36 mining leases covering 69,000 hectares (170,000 acres) from 54,000 Ha to extend and consolidate the 100% lease holding over the southern part of the salt lake at Kachi. Lake now holds over 200,000 hectares of lithium leases in Argentina, one of the largest listed lithium lease holdings.

The maiden exploration target released over the Kachi Project, which was only drilled for the first time a year ago, shows potential for 8.0 to 17 million tonnes of lithium carbonate equivalent (LCE) over an equivalent area of 20 kilometres x 15 kilometres, based on containing brines from near surface to 400 metre depths within approximately 13 cubic kilometres of brine (13,000 gigalitres). Table 3 provides the details of the geological exploration potential, with details of the exploration target provided below. The anticipated initial resource statement will cover a small portion of this total exploration target, centred on the western part of the basin.

An exploration target is not a mineral resource. The potential quantity and grade of the exploration target is conceptual in nature, and there has been insufficient exploration to define a Mineral Resource in the volume where the Exploration Target is outlined. It is uncertain if further exploration drilling will result in the determination of a Mineral Resource in this volume, although an initial resource statement is in the process of being prepared. The exploration target is, based on the available geological evidence, where there is the possibility of defining a mineral resource. Importantly the exploration target is not to be considered a resource or reserve. The exploration target is based on a series of assumptions and future drilling is required to determine the brine grade and formation drainable porosity values to establish whether a resource can be defined.

Lake drilling at Kachi has returned positive lithium values in the southwest of the project, where the passive seismic geophysics suggests the basin is the deepest. Further interpretation of the seismic lines suggests the basin continues to the south, significantly extending the exploration target to the south under cover where further positive results are anticipated from future drilling.

Kachi is the lowest point (around 3000 m altitude) of a large drainage area of approximately 6800 square kilometres (2500 square miles), larger than most basins producing lithium brine. The basin drains the lithium bearing volcanic rocks of Cerro Galan, which is interpreted to provide the lithium for the FMC Lithium (Livent) production at Hombre Muerto, together with hot springs. The lithium bearing brines at Kachi are hosted in high porosity, permeable sandy sediments.

Lake has partnered with Lilac Solutions to advance a rapid, low cost method for direct extraction of lithium from Kachi brines. The process aims to enhance the grade, reduce the lead time to production, lower operating costs and significantly increase recoveries.

Managing Director Steve Promnitz said: “The massive potential of this lithium brine is impressive. To use the analogy of the contained fluid in Sydney Harbour, this is equivalent to twenty five times that volume. The anticipated resource statement will only cover a small portion of this total potential.”

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CAUCHARI LITHIUM

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DRILLING ADVANCES AT CAUCHARI LITHIUM BRINE PROJECT

ASX Announcement 2 November 2018

  • Two drill rigs drilling on site advancing a four-hole 1500 metre program. 
  • Diamond drilling underway on first hole, currently at about 110 metres depth of a targeted 400 metres depth with the second rotary rig at 100 metres. 
  • Drill targets expected to show likely extension of high-grade lithium brines from adjoining proven lithium resources with initial results anticipated in two weeks. 
  • New short-term unsecured $0.5 million facility established with current shareholder

Argentine-focused lithium exploration and project development company Lake Resources NL (ASX: LKE) has advanced drilling at the 100% owned Cauchari Lithium Brine Project (See Figure 1). Two drill rigs are now on site, a rotary rig drilling 100 metre pre-collar holes through gravels to fast-track diamond drilling into the targeted brines.

The diamond drill rig has advanced on drill hole #1 and is currently at about 110 metres.

The rotary rig has been completed the pre-collar to 100 metres depth at drill hole #2. This will assist the diamond rig through the upper gravels into the brine sequence in this hole. The two holes are 2500 metres apart.

Assays are expected in the coming weeks from the brines being targeted. Drilling is anticipated to support the geophysics which has shown a likely extension to the high grade lithium brines of Ganfeng Lithium/Lithium Americas and Orocobre/Advantage Lithium in adjacent properties (Figures 2,3,4). Third party drill results close to the lease boundary include 600-705mg/L lithium with high flow rates (*1).

The Company advises that an unsecured $500,000 facility has been established with a current shareholder, immediately available for short term funding of the exploration activities including the advancement of drilling at Cauchari. The facility has a commercial interest rate. The Company is in discussions with a number of potential strategic investors to advance the flagship projects through prefeasibility study and/or feasibility study. With current facilities, Lake has sufficient funds to continue current exploration activities.

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QUARTERLY

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QUARTERLY REPORT 

ENDING 30 SEPT 2018

ASX Announcement 1 November 2018 

HIGHLIGHTS 

  • Four lithium projects in prime locations in north western Argentina, with large lease holdings totaling ~180,000 hectares. 
  • Resource drilling advanced at the Kachi Lithium Brine Project with 14 holes for 3100 metres to depths of 400 metres, reinforcing size and consistency of clean brines over an area of 22 x 8 kilometres; 
  • Kachi brines extend from surface to 400-800m depth at in permeable sands. 
  • Consistent results of 326 mg/L lithium, with highest grades from the most recent drill hole, with low impurities and a low Mg/Li ratio of 3.7; 
  • Partnership with Lilac Solutions to assess Lilac’s direct lithium extraction process for the Kachi lithium brine with the goal of establishing a rapid, robust, low-cost process for producing lithium. 
  • Lilac process demonstrated high recoveries of 80-90% lithium directly from Kachi brines, producing a brine concentrate of over 3,000 mg/L lithium; 
  • The Olaroz-Cauchari leases adjoin lithium brine production of Orocobre and development projects with world class lithium resources in the same basin as Orocobre and Ganfeng/(SQM)/Lithium Americas. 
  • Drilling underway at Cauchari to test geophysicsconfirmed extensions of adjoining world-class brine resources; 
  • Option exercised over ~70,000 hectare pegmatite lithium project in Catamarca, a large area with small-scale production in the past, but limited modern exploration.

Lake Resources NL is an exploration and development company with one of the largest lithium lease holdings in Argentina of ~180,000 hectares with four prime lithium projects: 3 brine projects and 1 hard rock project. Each is capable of being a ‘company maker’.

These include the Kachi Lithium Brine Project which covers ~54,000 hectares of consolidated mining leases over a previously undrilled salt lake; the Olaroz-Cauchari and Paso Projects in Jujuy province adjacent to Orocobre and Ganfeng/(SQM)/Lithium Americas; and the Catamarca Pegmatite Lithium Project (~72,000 hectares), with large pegmatite swarms over past production within a 150km long belt.

A maiden resource estimate is anticipated soon from the Kachi project. The large area of Kachi with a single owner appeals to battery makers, and is suited to a strategic investment/partnership. Drilling at Cauchari has already begun, and drilling over the Olaroz leases will commence soon. These are targeting extensions of known brine lithium resources of over 15 million tonnes LCE (Lithium Carbonate Equivalent).

OPERATIONS 

Kachi Lithium Brine Project - Catamarca Province, Argentina

Summary 

The Kachi Lithium Brine Project is located in Catamarca province, NW Argentina. It is a consolidated package of ~54,000 hectares of mining leases 100% owned by Lake, centred around a previously undrilled salt lake within a large lithium brine-bearing basin. Kachi is one of the few salt lakes in Argentina with substantial identified lithium brines fully controlled by a single owner.

The Project covers the lowest point of drainage from a large area of over 6,000 square kilometres, sourcing lithium from acid volcanics and hot springs. This large drainage covers the areas immediately south of Livent / FMC Corp’s Hombre Muerto Lithium brine operation (which is Argentina’s longest operating lithium brine project) and Galaxy Resources (GXY.ASX) Limited’s Sal de Vida lithium brine project, both sourcing lithium from similar volcanics. Also nearby is Albemarle Corp’s Antofalla lithium potash brine development project.

Resource drilling shows consistent results and continues to confirm the large scale and quality of the Project. Drilling and geophysics have confirmed the presence of a large deep salt lake basin with an area of 22 x 8 kilometres and 400-800 metres deep. This is a similar size to globally significant lithium brine producers in Argentina and Chile. The brine body at Kachi has the potential to increase further under covered areas.

To date, Lake has completed 14 rotary and diamond drill holes for 3100 metres into the lithium brine-bearing sediments. Results reported from 13 drill holes from 6 drill platforms spaced up to 11 km apart, with variable depths up to 405 metres, demonstrate that lithium brine is present from near surface to over 400 metres depth, and indicate the likely extension to the south potentially at similar grades and to greater depths.

Consistent results have been delivered, with highest grades to date from the most recent drill-hole K08R14 averaging 326 mg/L lithium with low impurities and low average Mg/Li ratio of 3.7 (3.4 – 4.8). An initial resource estimate at Kachi is anticipated in the coming weeks, with an exploration target provided beforehand.

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KACHI

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PHASE 1 ENGINEERING WORKS CONFIRM HIGH LITHIUM RECOVERIES AT KACHI

ASX Announcement 29 October 2018

  • High lithium recoveries of 80-90% delivered from initial brine samples at Kachi Brine Project using Lilac Solutions process. 
  • Lilac process shows production of greater than 3000 mg/L lithium from average brine samples in a few hours. 
  • Increased recoveries indicate that a 300 mg/L lithium brine would produce similar volumes of final product as a 600 mg/L lithium brine. 
  • Partnership to advance a rapid, low cost method for direct extraction of lithium from brines at Kachi. Process aims to reduce lead time to production, operating costs and significantly increase recoveries. 
  • The new process appears more environmentally sustainable than traditional methods, is easily scalable to increase production and has a smaller footprint. 
  • Lilac now estimating operating costs for commercial lithium production at Kachi for direct production of lithium carbonate or lithium chloride – globally competitive cost anticipated.

Argentine-focused lithium exploration and project development company Lake Resources NL (ASX: LKE) and Lilac Solutions, Inc. (“Lilac”) are pleased to report very high lithium recoveries from brines as part of Phase 1 engineering work to develop Lake’s 100%-owned Kachi Lithium Brine Project in Argentina (“Kachi”).

Lilac has reported high lithium recoveries and high lithium eluate purity from preliminary results from the Phase 1 Engineering. This lithium eluate can be processed downstream into battery-grade lithium carbonate or lithium hydroxide based on conventional processes with a downstream recovery of around 90%.

Lilac has achieved lithium recoveries from the Kachi brine sample into the lithium eluate of 80-90%. After downstream processing, this is estimated to provide an overall project-level lithium recovery of 70-80%. This compares very favourably with project-level lithium recoveries below 50% for conventional operations in the Salar de Atacama, which feature lithium grades above 1,000 mg/L.

Lilac has processed the Kachi brine sample in a single step going from the average raw brine concentrations to a lithium eluate containing 3,000 mg/L Li, 400 mg/L Na, 250 mg/L Ca, 120 mg/L Mg, and 1 mg/L B, which can be readily processed through reverse osmosis and conventional purification technologies and fed into a conventional carbonate plant. Further samples are being tested for refinement of the process.

Lilac is now estimating operating costs for commercial lithium production at Kachi for direct production of lithium carbonate or lithium chloride. Given initial results, Lilac expects a globally-competitive cost of production.

Lilac is performing Phase 1 Engineering to optimise the Lilac system for the Kachi brine’s particular chemistry, establish performance of the system including lithium recoveries and purity of the lithium eluate solution produced by the Lilac system, determine the quantities of chemical reagents needed to drive the lithium extraction process, and estimate operating cost of commercial production of lithium.

This follows the announcement in September where Lake and Lilac entered into a partnership to leverage Lilac’s proprietary ion exchange technology (the “Lilac Technology”) for the Kachi brine with the goal of establishing a rapid, robust, and low-cost process for producing lithium at Kachi.

Lilac Solutions is transforming lithium production with its innovative ion exchange technology for extraction of lithium from brine resources. Lilac deploys unique ion exchange media and related processes to extract lithium from a wide variety of brine resources with high recoveries, minimal costs, and rapid processing times. This approach eliminates the need for evaporation ponds, which are expensive to build, slow to ramp up, and vulnerable to weather fluctuations.

A significant environmental benefit comes from the removal of evaporation ponds as the footprint of the operation is significantly reduced. Further, the method allows for the remaining brine to be re-injected into the same aquifer from where it is sourced, without significantly adjusting the water quality, thereby preserving an aqueous resource in an arid environment.

Lilac’s technology can economically access brines with low lithium concentrations and high concentrations of other salts, such as magnesium. Cost advantages come from reduced time, higher recoveries and a simplified extraction flowsheet with fewer reagents. The technology is modular to suit various project sizes and integrates with conventional plant designs for production of battery-grade lithium carbonate and lithium hydroxide. The technology has been successfully tested with real brine samples across the Americas.

The Kachi Lithium Brine Project covers 54,000 hectares (133,000 acres) over almost an entire lithium-bearing salt lake in Catamarca province, ~100 km (60 miles) south of Livent/FMC's Hombre Muerto Lithium brine production operation. FMC Corp has been operating its lithium business in Argentina for over 20 years.

Lake and Lilac believe that combining Lake’s scale and project experience with Lilac’s technology and process expertise enables a rapid path to very large-scale commercial production of lithium at Kachi.

“Lake Resources is delighted to see excellent results showing the potential of the Lilac process to deliver a rapid, direct extraction process of lithium from brines. The potential to reduce the timeline to production at low cost is a major advantage in the current market with a constrained supply of lithium. Increased recoveries indicate that a 300 mg/L lithium brine would produce similar volumes of final product as a 600 mg/L lithium brine,” said Steve Promnitz, Managing Director of Lake Resources.

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VIDEOS

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