TORONTO (miningweekly.com) – Junior explorer Lithium X announced Thursday that its 50%-owned subsidiary Potasio y Litio de Argentina (Plasa), which owns 100% of the Sal de los Angeles lithium/potash brine project, in Argentina, has entered into a definitive joint venture (JV) agreement with a consortium of experienced Argentinian firms known as Salta Exploraciones (Sesa) to develop a pilot lithium production facility at the project.
According to the Vancouver-based junior, initial production from the project was expected within 15 months after evaporation pond construction had been completed.
“This JV agreement is a major accomplishment for Lithium X. It represents an important step towards full-scale lithium production.
"The agreement also secures both the financial contribution, know-how and operation of several engineering and construction groups that have been involved in the design, build and/or operation of three construction and development-stage lithium brine projects in Argentina over the last five years," stated Lithium X executive chairperson Paul Matysek.
Lithium X has an option to acquire up to an 80% interest in Plasa.
Under terms of the JV agreement, the partners would build a pilot facility, designed to produce up to 5 000 t/y of lithium carbonate equivalent (LCE). The agreement set out the terms for the construction, operation, production and sales resulting from the pilot plant.
Sesa would be required to contribute about C$6-million of the required amount for the construction and operation of an initial 2 500 t/y LCE ponding facility by incurring all construction costs, including one full year of post-construction operation. Plasa would contribute about $3.3-million for a 30% contributing participation in the JV company and the right to commercialise the lithium products.
Further, Plasa would also be fully carried for the remaining 20% for contributing brine from existing wells on the project, including a free-flowing artesian well that was expected to supply the operation during the initial years.
The JV company would have the option to increase its operating facilities to 5 000 t/y of LCE after completing a full 12-month period of cash-flow positive operations on an after-tax basis. Sesa would be the project operator, under the direction of an evenly balanced operating committee, Lithium X advised.
The ponding facility would be designed to operate using conventional evaporation-based processing with the objective of initially producing a lithium chloride concentrate with a concentration higher than 30%, which would be sold. Based on a production rate of 2 500 t/y LCE, operating for the 25-year mining period, the total life-of-mine output would be 62 500 t of LCE.