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Argentina Lithium & Energy (TSX-V: LIT)(OTC: PNXLF) VP of Exploration Miles Rideout on Multi-Property Lithium Acquisition in Argentina & Near-Term Exploration Plan
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the vice president of exploration for Argentina Lithium & Energy — Mr. Miles Rideout. Miles, how are you today? It's a pleasure to have you on.
Miles Rideout: I'm very well. Thanks for inviting me to chat.
Gerardo Del Real: The timing is excellent! Lithium has had a pretty clear supply-demand picture for the past five years for anyone that was paying attention. But it's really accelerated price-wise this year; the spot price.
Argentina Lithium, which I believe you came on as vice president of exploration back in… was it at the end of August… is that accurate?
Miles Rideout: That's right, yes.
Gerardo Del Real: Wonderful. So Argentina Lithium just entered into an agreement to acquire the Rincon West and the Pocitos properties in Salta province, Argentina. And I want to talk about the superior infrastructure; why you believe the properties are so prospective.
But before that, I would love for you to give our audience a bit of a primer on your, I believe, it's 35 years of experience in the business…
Miles Rideout: Correct. I'm an exploration geophysicist. I qualified in Canada. I went to the University of Western Ontario and I worked with Quantec Geoscience for 23 years right from close to the inception of that company. And we opened offices all over the world.
But I went down to Chile in 1989 when I was just turning 26, I think, 25 or 26, to open the first regional office in Latin America. And then, we opened offices in Peru, Bolivia, Argentina, Brazil. There was an office opened in Mexico but I wasn't involved with that. And offices in Australia. We went international, and I worked with Quantec for 23 years.
I left Quantec in 2010 to be the CEO of Latin American Minerals who had gold and diamond projects in Paraguay. And we built the first mine. It was a pilot-scale mine but the first mine in Paraguay's history. And gold became very difficult in the last decade for a time. And I moved into the lithium space, well, permanently to the lithium space, in about 2016.
I'd been doing work as a consultant geophysicist in lithium and other brines for many years prior to that. But I became the exploration manager for another lithium company operating principally in Catamarca province. And I was recruited away from them by the Grosso Group just over a month ago. And I'm enjoying the new company.
Gerardo Del Real: Well, let's talk about the Rincon West and the Pocitos properties. With your background, I am curious to hear your take on what sounds like excellent infrastructure nearby. And the press release describes the properties as having great potential for the discovery of high-grade lithium brines. Can you speak to each of the properties and what's attractive?
Miles Rideout: Sure. So to fill in the scenario… so right now, Argentina Lithium has four property segments. So there's one in Catamarca; that's Inchuasi where we have a very large holding. And one of my jobs right now is to review the findings, organize a new geophysics program. And we're going to probably revisit that and have another go at drilling that salar. It has size and it has favorable infrastructure as well but in northern Catamarca province.
Argentina Lithium also did an option agreement about two months ago for expanding their property in Antofalla North. So Antofalla is a salar, which is mostly Catamarca and the top end is in Salta. So Argentina Lithium has been focusing on the portion in Salta province, which is bureaucratically favorable. And we're getting that ready for drilling. And so that was in advance about two months ago.
And then this week, we are in the process of closing the deal for Rincon West. Now the Salar del Rincon, it's currently being developed by two other companies. And so they've done a lot of drilling on the salar, and they're returning results around 400 milligrams of lithium per liter. And I've arbitrarily set for our company a target that we'd like to see 400 or potentially better so that when we get to a production stage that we can be a low-cost producer rather than a high-cost producer.
I think it's going to be strategically valuable that we're on the low-cost side so that we're able to make the best use of a long-term market, which potentially might have a declining price as more capacity comes online.
Gerardo Del Real: Right.
Miles Rideout: So Rincon is on the west side of the salar, which has been drilled extensively. But the Rincon West property has never been drilled. But it looks very favorable. It's just over 2,300 hectares. There is some limited geophysics on it. And I went through the geophysics, and we can see the brine is at 30 meters depth.
The surface structure is sands and gravel so it looks as though it'll be a very permeable substrate for production wells. So this looks like an excellent play that we can get into high producing wells with brine values approaching 400 milligrams per liter. And it's easily done; the infrastructure is very good.
We're just south of the major highway down to the Pacific ports in Chile. And there's an electrical power corridor running within one kilometer of the salar. So it looks to us not quite a turnkey operation but an easy way to begin a production plan once we've completed drilling and, of course, a feasibility study.
So there is a bit of time that we need to set aside for that. But this looks like it's a project that's worth fast-tracking.
Gerardo Del Real: It's clear from just your explanation and the context that you provided there, Miles, that you clearly are looking ahead at developing these properties, and you're vetting the properties with that in mind.
This isn’t a situation where Argentina Lithium picked up four projects here over the past several years just to ride the trend out, right? It's very clear to me just from speaking with you and being familiar with management that the team is laser focused on developing, at the very least, the most prospective properties, right?
We know that exploration inherently is risky and not every property is going to work out. But it sounds like you're being very selective in the properties that you bring into the portfolio.
Miles Rideout: Absolutely. The other thing I would like to point out, the Grosso Group is expert at managing properties and managing property development in all markets. And so, I mean, they've brought four large resources forward in Argentina in the last 20 years.
But what I like is watching them do this deal for the Rincon West property. They're taking the long-term view of how to acquire and manage properties. So I don't think this is the last property acquisition we're going to be doing. I think that our plan going forward is to selectively do deals, good deals, for properties where we can assess the property and, if it makes sense, take it to production.
I don't want to quote a lot of numbers and costs but the investment in infrastructure for production might be, say, C$200 or C$400 million. So with a properly structured property deal, if you put the costs in the right place, you can still get into good ground in the current market, and the ultimate cost is not a significant portion of your total investment in a production plan.
Gerardo Del Real: Well said, well said. I'm looking forward to having you back on. What comes next?
Miles Rideout: Now, you did mention Pocitos, and while we’re talking about exploration, so Pocitos, it's a much larger salar but there's been very little development there. So historically, there's been some very attractive sampling near-surface returning upwards of 400 milligrams of surface. Very limited drilling there; hasn't returned promising results.
Now this was thrown into our deal with the Rincon West. So we're taking it and we'll take another look at Pocitos. When I say it's large, I mean, the property there is 16,000 hectares. So, I don't know, it's 20 kilometers or something like that, north-south, and several kilometers across, maybe 4 or 5 kilometers across. It's a large position.
So we'll be assessing this to see where we will drill, and we'll assess how much potential it has. But it came as part of the deal. So we'll take a look and see where that goes. By the way, Pocitos is very attractively positioned. It's just east of the Arizaro salar, which has a resource on it, I believe.
I did work on Arizaro about 15 years ago, and this is attractive real estate. And so I think Pocitos is worth a good hard look. But our focus going forward right now, we would like to fast-track Rincon because it looks like an excellent place to start and develop our first resource.
Gerardo Del Real: I'm looking forward to the progress there. Thank you so much for the update today. Looking forward to having you back on. That was very enlightening.
Miles Rideout: My pleasure.
Gerardo Del Real: Awesome. We'll talk soon. Take care now.
Miles Rideout: Thank you. Bye-bye.Click here to see more from Argentina Lithium & Energy