Categories: Energy
Topics: Lithium Stocks

Argentina Lithium & Energy (TSX-V: LIT)(OTC: LILIF) CEO Niko Cacos on Fully Funded Lithium Drilling in Argentina

 

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the president and CEO of Argentina Lithium and Energy, Mr. Niko Cacos. Nico, always great to have you on. How are you, sir?

Niko Cacos: I'm doing very well, and it's always a pleasure to be on your program, Gerardo. Thank you.

Gerardo Del Real: Well, thank you for the kind words. Let's get right into it. We chatted very briefly off-air. I mentioned to you that I believe we're finally getting some momentum back in the lithium space. The spot price has been firming up a bit. It's definitely bottomed, and now the equities and especially those that are delivering are starting to get some love and volume in the market. So with that being said, perfect day for Argentina to have some news. You just announced a 327 meter lithium brine interval at the 13th exploration well on your Rincon West project. I would love for you to provide the context there.

Niko Cacos: Well, absolutely. This is on our Rincon West project, like you stated. It's situated in Northwestern Argentina. Our neighbor there is Rio Tinto, one of the largest mining companies in the world that has an enormous resource that's going into production. And the drill results that we've been putting out have been positive. Every single hole has exceeded our expectations and the results are exactly the kind of results that they've been getting. So we're on track for defining a resource and we expect to be defining that in the coming months here. And we're very excited about it. And I wish I could say that we timed this with the market, but unfortunately I don't have that kind of skill. But it is nice to see the lithium market turning around, and I think we're poised to capture some of that upward momentum with our company as well.

Gerardo Del Real: Let's talk about the last several months. I mentioned the consolidation in the lithium space and frankly the just absolutely cratering of the price there for a bit. But now that that's firming up and that we're starting to see even Chinese suppliers not being able to make money at current levels, that's usually a pretty good sign of a bottom. You've been busy adding value the last couple of months. You added nearly 600 hectares back in August after a geophysical survey of potential brine aquifer at Rincon West, and then you exercised an option agreement in September on nearly 25,400 hectares of highly prospective lithium properties at Rincon West, Pocitos, and Antofalla North so I would love for some color to those two pieces of news because again, in the soft market nobody really cares. But these are the types of transactions and acquisitions that can be very opportunistic. It can really add value to your project during quiet times.

Niko Cacos: Yeah. Well, we are in a very envious position and stand out, I suppose, from the rest of our peers in the exploration world for lithium especially in that part of the world in Argentina, in that as our partner, we have Stellantis. Stellantis is one of the largest car companies in the world that produces vehicles, Fiat, Chrysler, Jeeps and so forth. They're one of the largest companies, and they have acquired last year 19.9% interest into our company, into our subsidiary. And for that, they paid the equivalent of 19 million US dollars.

So we are in an envious position of being well cashed up, having the funds and so that all our exploration programs are paid for. So while the rest of our peers were slowing things down and preserving capital, we've been proceeding, actually in many ways accelerating our exploration efforts and moving our projects ahead during this period. And knowingly that lithium, like all other commodities, they go up and down in cycles. You can't plan developing something by keeping in mind the cycles all the time but here we are in a situation where the work that we plan to do, we can afford to continue to do it, and we're generating value for our shareholders.

Gerardo Del Real: What comes next? The news today comes from, or yesterday comes from the 13th exploration well, but what comes next at Rincon West?

Niko Cacos: Well, we have another exploration hole to come, and then now we have some claims to the east that we're going to move our drill rigs and begin drilling out there. That seems to where we recently completed the geophysics, and we have announced that, and it shows to be very positive imaging in the geophysics so we're quite excited about that. And then of course, we're going to be putting rotary wells and doing pump tests on our already drilled out property. So we're basically getting on track for trying to get our initial resource to come out, hopefully by the first quarter of 2025 here.

Gerardo Del Real: The world apparently seemingly every day becomes less and less stable. Jurisdiction is becoming absolutely critical. Can you speak to how it's been working in Argentina?

Niko Cacos: Argentina is, again, fighting that trend, going against rather that trend. The new government that took charge this year, the Milei government has been using new and unorthodox ways to... They've been successfully taming inflation and creating a business environment that is very attractive for multinational companies. We're seeing a lot of new investment coming in Argentina, a lot of investors right now viewing Argentina with a very positive light. We, of course welcome that, and being, of course a company that's been active in Argentina with a track record of over 30 years through the Grosso Group. You know we know where the opportunities lie so it's a great place to be. And of course, as we talked earlier, a little bit about the lithium price recently you may have noticed that there's a huge stimulus package that's been announced in China and trying to stimulate and get the economy going there. And I think that's also having a very positive impact in terms of outlook for selling electric vehicles and of course increasing the demand for lithium.

Gerardo Del Real: No, look, I think that stimulus package is really important to highlight. It was something like 2 trillion yuan, the equivalent of almost 300 billion dollars. And in addition to that, there were a lot of levers that were pulled in regards to lowering interest rates, not for new mortgages, on existing mortgages and so obviously that's increased purchasing power. I don't think China is done, I think there is more coming in the pipeline. That bodes well for commodity demand when you have the world's largest consumer trying to stimulate consumption, right?

Niko Cacos: That's correct. Yes.

Gerardo Del Real: Well, Nico, always a pleasure. Great to have you back on. I'm looking forward to chatting again soon. Thank you, sir.

Niko Cacos: Great. Thank you, Gerardo.

Gerardo Del Real: All right. Cheers.

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