Building a Cleaner Future via the Power of Battery Metals
CSE: RR | OTC: RECHF
Multiple exploration projects underway for key battery metals in the global EV megatrend
Vancouver-based Recharge Resources Ltd. (CSE: RR)(OTC: RECHF) is a Canadian mineral exploration company focused on early-stage exploration for high-value battery metals — including lithium — in the global EV megatrend.
With high-potential exploration projects in multiple categories of clean-energy metals — including lithium, copper, gold, and palladium — Recharge Resources is capitalizing on numerous opportunities to enhance the EV and battery power markets through boots-on-the-ground mineral exploration.
The company is currently advancing three primary projects in mining-friendly jurisdictions in Canada & Argentina:
- Pocitos-1 lithium project in Salta, Argentina
- Georgia Lake North & West lithium project in Ontario, Canada
- Brussels Creek copper-gold-palladium project in British Columbia, Canada
We’ll be exploring each of these high-potential projects in detail in this Special Report.
But first, let’s take a look at the key metals Recharge Resources is exploring for and their importance in the green energy revolution.
EVs Driving Demand for Key Battery Metals
The global electric vehicle (EV) boom is driving demand for a key element in battery power generation — lithium.
Bloomberg New Energy Finance projects that by 2040 — 57% of all global vehicle sales will be electric.
That’s over 55 million EVs being sold annually — a nearly 10-fold increase from the 6 million being sold today.
Tesla founder, Elon Musk, goes a step further stating… all transportation on Earth will eventually go electric!
And all of that demand is going to require tons and tons of lithium… the aptly-named “white petroleum.”
Around 90% of battery demand will come from EVs over the next two decades.
Battery metals are the raw materials used in the production of batteries with lithium leading the charge.
High-conductivity metals such as lithium, copper, and gold are commonly used in batteries and/or in other components for electric vehicles, consumer electronics, and numerous other applications.
EVs and hybrids use anywhere from 40 kg to 85 kg of copper per vehicle. Gold, which is a near-perfect conductor of electricity, is used in the circuitry of EVs.
Global demand for battery metals is projected to increase by 500% by 2050.
And in just the next decade and a half, the world will be buying more EVs than combustion engine cars as the world seeks to go greener.
A carbon-neutral future will require many millions of batteries, both to power electric vehicles and to store wind and solar power on the grid.
The global battery metals market was valued at $11.3 billion in 2019 and is projected to reach $20.5 billion by 2027, at a CAGR of 8.2% from 2020 to 2027.
That trend means that the companies that can find and extract these key metals are going to be in high demand for the foreseeable future.
Recharge Resources Ltd. — which is led by a seasoned group of mining professionals with decades of combined experience in mineral exploration and discovery — has its collective boots-on-the-ground at multiple exploration projects with plenty of news flow ahead, including drilling, in the coming quarters.
An Impressive Property Portfolio
As noted, Recharge Resources is advancing three primary mineral exploration projects: two in Canada and one in Argentina.
The two Canadian projects are focused on 1.) hard rock spodumene lithium, and 2.) copper, gold, and palladium while the company’s flagship Argentinian project is a pure lithium brine project within the prolific Lithium Triangle.
Let’s take a look at each of these three projects.
The Flagship: Pocitos-1 lithium project, Argentina
The flagship, 100%-owned Pocitos-1 lithium project is located approximately 10 km from the township of Pocitos in Salta, Argentina.
Due to strong lithium demand driven primarily by the global EV megatrend, the price of the metal has increased by approximately 500% in just the last year or so.
The 800-hectare Pocitos project is situated within the prolific Lithium Triangle of South America, which encompasses parts of Argentina, Chile, and Bolivia — representing more than HALF of global lithium resources.
Lithium values of up to 125 ppm from laboratory analysis conducted by Alex Stewart were recorded by AIS Resources during the project’s first drill campaign by AIS in May 2018.
Previous exploration teams have spent over US$1.5 million exploring the project, including surface sampling, trenching, TEM geophysics, and two 400-meter holes that produced outstanding brine flow results.
Follow-up drilling by Recharge Resources in 2022 intercepted the target aquifer, which surged from 363 meters depth in its NQ diameter exploration well.
Brine samples from the recently completed program have been taken to the lab for analysis. Investigation of the gas is also underway.
Recharge QP and principal geologist Phil Thomas — whom you’re about to hear from directly in our exclusive interview coming right up — commented via press release:
“I am thrilled to see the continuity of the first reservoir discovered back in 2018. With this second lithium brine surge (previous at 350m) we have entered the target zone with sampling now underway. This will be the fourth resource estimation project I have been involved with to delineate a lithium deposit mineral resource and I am very keen to see this project through to the vision I had for it back in 2018.”
Importantly, Mr. Thomas has spent the last 22 years exploring for lithium brines, including building and operating a pilot plant for production at the Rincon Salar, which was sold to Rio Tinto for US$825 million.
He and his team also developed the Pozuelos salar — which was sold to Ganfeng for US$962 million — producing an Indicated and Inferred resource from four exploration wells.
Recharge Resources CEO David Greenway added:
“With two existing drill holes in place, this new drilling will contribute to establishing an NI 43-101 mineral resource estimate. We have benefited greatly from an Argentinian geological team which has empowered us to continue to make progress towards our next goal of establishing an NI 43-101 compliant mineral resource, a scoping study of the project and formalizing our offtake agreement for lithium chloride.”
Recharge is aiming to establish an NI 43-101 compliant resource and build up to a 20,000 tonne per year EkoSolve™ lithium extraction plant at Pocitos in order to supply Richlink Capital Pty Ltd. clients up to 20,000 tonnes of lithium per year as previously announced under a Letter of Intent and framework agreement.
Recharge licensed EkoSolve in Q3 2022 and has an Argentina-wide license for the utilization of the extraction technology.
With high recoveries of lithium from brines, the EkoSolve process produces battery-grade lithium carbonate while circumventing the issues associated with the removal of brine contaminants, particularly magnesium.
EkoSolve also eliminates the need for costly evaporation ponds, which can result in substantial capex savings and increase efficiency with no further processing required for producing battery-grade lithium.
Locations for immediate follow-up drilling at Pocitos have already been identified for upcoming exploration. Our exclusive interview with geologist Phil Thomas covers the Pocitos-1 project in detail.
Georgia Lake North & West lithium project: Ontario, Canada
The Georgia Lake North & West properties are located approximately 160 km northeast of Thunder Bay, Ontario, within the Thunder Bay Mining Division.
The 100%-owned property comprises two claim blocks totaling 320 hectares and 432 hectares.
Recharge’s property is contiguous to the north and west boundaries of Rock Tech Lithium’s Georgia Lake lithium property, which lays host to several spodumene-bearing pegmatites.
In Q4 2022, Recharge completed a high-resolution heliborne magnetic survey at the project.
Recharge Resources CEO David Greenway commented via press release:
“While we await completion of our production diameter well now nearing our target depth at Pocitos 1 in Argentina, we continue to progress on multiple fronts including the now permitted Brussels Creek, the spin out of Pinchi Lake to NextCharge Battery Metals Ltd. and now, our airborne magnetic survey at Georgia Lake is underway. We are thrilled the team at Prospectair were able to lock in an engagement and deploy to the property on such an immediate time frame as the weather is about to change and exploration activities are still surging due to lithium prices continuing to hit all time highs. The point of this airborne survey is to identify the potential for structural continuity from neighboring Rock Tech’s active development at its Georgia Lake Project. Rock Tech signed a major lithium supply agreement with Mercedes-Benz AG and Recharge is committed to advancing and monetizing its portfolio of assets to the benefit of all stakeholders.”
Data compilation from the magnetic survey is anticipated in Q1 2023 wherein the company plans to deploy an aggressive spring 2023 field program.
Brussels Creek Copper-Gold-Palladium Project: British Columbia, Canada
Recharge Resources has announced a fully-funded drill program at the 100%-owned, early-stage exploration Brussels Creek project located approximately 24 km west of Kamloops, BC, Canada.
The program is slated for 900 meters across 3 drill holes and is being deployed to test the potential for copper-gold mineralization similar to what’s present at the adjacent New Afton mine owned by New Gold Inc. (NYSE-Amer: NGD)(TSX: NGD).
The property comprises 17 claims spanning 1,350 hectares in a geological setting similar to the New Afton Mine — a silica-saturated copper-gold alkalic porphyry-style deposit — as well as the Highland Valley, Mount Polly, Kemess, and Galore Creek deposits.
Recharge Resources CEO David Greenway commented via press release:
“While data compilation is underway at Georgia Lake Lithium and the company awaits results from Pocitos 1, we are pushing forward on all fronts with drilling about to commence at Brussels Creek. We thank Mr. Shearer and all those involved in the consultation and drill planning process. Recharge is committed to sustainable exploration and mining practices. This is a pivotal time for the Brussels Creek Project in BC, and we look forward to the upcoming drill program starting early next month.”
Historic sampling and mapping at the property in the mid-1980s identified a broad anomalous zone measuring 200 x 400 meters with gold values up to 3.5 grams per tonne.
Drilling at Brussels Creek is expected to commence in Q1 2023.
Exclusive Interview with Recharge Resources Principal Geologist Phil Thomas
Our own Gerardo Del Real of Resource Stock Digest took the opportunity to sit down with Recharge Resources principal geologist Phil Thomas.
Boasting multiple decades of experience in lithium brines, Phil is the perfect person to reach out to to discuss the company’s flagship Pocitos-1 lithium project.
We hope you’ll enjoy this first-hand look at Pocitos. And be sure to check back here periodically for upcoming interviews with Phil and other top brass at Recharge as Gerardo follows up on key developments in the coming months.
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the principal geologist for Recharge Resources — Mr. Phil Thomas. Phil, it's our first time chatting on air. How are you today, sir?
Phil Thomas: Gerardo, I'm excellent and it's a pleasure to be on your program.
Gerardo Del Real: It's great to have you on. I must say, when I first started watching the Recharge story, what struck me was a couple of things: One, I'm wildly bullish on lithium. Two, Argentina has become a bastion of stability in South America and is attracting a lot of capital here recently, specifically in the lithium and the copper sectors.
And so when I looked at the flagship project — the Salar de Pocitos project in Argentina — and I saw the work that you were doing and I started getting into the technology of it, and then you had some early success. And then, I look further down the line, and I see that there's also a gold project involved, there's a nickel project — all commodities which I really like.
I thought, well, let's see if we can't get together and have a conversation here about Recharge and the portfolio. And I'd love to start with your background a bit just for those that may not be familiar.
Phil Thomas: Sure, I've had about 22 years of experience in lithium brines. Obviously, I'm a geologist and I’m qualified with the Australian Institute of Mining & Metallurgy and the Australian Institute of Geoscientists. So that credits me in lithium brines, and it gives me accreditation for 43-101 and ASX JORC.
And basically, it's been an interesting 20-odd years in the sense that I started off my career exploring the Rincon… looking at the chemistry and the hydrology. And it very quickly became apparent that the key aspect to a successful lithium brine project is your processing technology.
So we put seven boreholes across Rincon, created a pilot plant, solved the problem of the high magnesium in the Rincon, which was about 15 to 1 where we were, and produced lithium carbonate. That was six years. And from then on, we moved to Persualos. And by the way, Rincon recently just sold for $655 million… I was just 10 years too early!
Gerardo Del Real: Which is about $645 million more than your current market cap at Recharge, right?!
Phil Thomas: Exactly, and about $635 million more than what I sold it for in the GFC [Global Financial Crisis] of 2008… so that was interesting! Then, we went to Persualos, which is a different type of salar. It's actually quite unusual because it actually has an old salar that got uplifted and then poured into the new salar, if I can call it that.
So we did the same thing again. We studied the geology and the aquifers. We put four drill holes in, pumped it out, came up with a resource… and that was pretty successful. And I was the CEO of Lithia at the time, and we decided to sell our interest because the lithium price was going south down back to $4,000 or $5,000 a tonne.
I then moved onto AIS Resources where I'm currently director. And at AIS Resources, we basically explored Salinas Grandes, Velama, Washetok, Azario, Incahuasi. And so we did a lot of exploration work. We've drilled some holes in a couple of those salars. We did a lot of trenching and a lot of chemical analysis.
And so that brings me back to Pocitos in 2018. AIS Resources drilled it. We’ve got unbelievable flow rates. I've never seen anything like it. And it's not like it was a one-hour wonder. It went for 10 days.
So the water pressure from the aquifers and the flow from the mountains and the volcanoes pushes the brine through the porous bodies, which are mostly halite, which is salt and sand and clays that have aggregates in them. And you put a well down, and it's going down to 350 to 400 meters at Pocitos. It's not on the surface.
And so we don't have the problem that Chile has with groundwater, or even Rincon where, basically, all of your brines are sitting in the top 100 meters. This is down below a very solid clay layer, and that's what creates the high pressure aquifer.
So we drilled that, and, of course, we had the problem with the high magnesium. But at that time, it was 25 to 1. And we said, ‘Okay, it's a dead duck. There's no technology around that's going to manage that.’ So we moved on. And then, I came back, and Recharge asked me to do some work for them… and off we went.
Gerardo Del Real: So tell me, what is it about this specific project? And hopefully, I'm correct in saying that, to me it appears anyhow, that the bulk of the focus for the time being is on this project. But what is it about the project that attracted you to work with Recharge to look at it and advance it here?
Phil Thomas: The flow rate of Pocitos was the key issue and the fact that it’s big at 800 hectares. And so that was kind of the attraction. Plus, I knew the geology quite well. And so the geology was pretty good from a lithological layer point of view.
What you want is big, wide, flat layers where you've got lots of brine flowing through defined aquifers. What you don't want is small channels of aquifers. So Pocitos has that characteristic and that was the key. Also, it's 10 kilometers from the local town. There's plenty of flat land around. There's a small community there that's very pro mining. So it had all of the what I call modifying factors when we're doing proven and probable resource statements to make the project a success.
Gerardo Del Real: I mentioned lithium in Argentina being red hot as far as attracting capital. I also mentioned that your market cap is right around C$10 million. I think you're right around the C$12 to C$13 million mark, if I'm not mistaken.
What do you think is going to be the value driver here moving forward because I can tell you that a successful lithium company in today's market is going to command a market cap much, much higher if you're able to achieve the objectives that you're looking to achieve here in the next few quarters. I understand that a 43-101 is being contemplated and advanced. What comes after that?
Phil Thomas: Well, that's the inferred and indicated resource statement. And then, we need to do a little bit more drilling to get up to production well size. And we’ll probably do three or four production wells across the salar. And then, we'll add the modifying factors and come up with a proven and probable reserve.
And then, once we've got that, we will go to kind of a bankable feasibility study rather than a pre-feasibility study or what I call a geological feasibility study. And that's because the technology of getting your pumping stations in and then getting a plant on the ground is pretty basic. So it's really testing the flow rates and testing the persistence of the grade that you've got so that you can do the math and calculate what it's worth.
This is a very fast process. You might have seen Galan Lithium, an Australian company, where they did two production holes, some geophysics, and then they came up with a proven and probable reserve statement from their inferred and indicated resource statement.
So you don't need a lot of exploration like you do with copper and gold where you need to drill with 25-meter intervals and make sure the lithology is consistent. So this is a very fast process.
Gerardo Del Real: It sounds to me like, if you're going to be successful on this specific project, we're going to know relatively quickly, which, again, is super compelling to me just because of the tiny market cap. I want to thank you for your time, Phil.
Is there any other project that you want to touch on during this conversation? By the way, I'm looking forward to having future ones on the rest of the portfolio. I just know that the major catalyst here in the very, very near term is Pocitos, and so I wanted to focus our conversation on that today.
Phil Thomas: Yes, Pocitos is the jewel in the crown at the moment, and the drill holes are completed. We've just about finished all of the assays. The preliminary ones look very, very positive. So I think it's a green light and we'll know in the next couple of days.
Gerardo Del Real: Looking forward to those results. Looking forward to chatting again. Phil, again, thank you for your time, sir.
Phil Thomas: A pleasure.
The Clean-Energy Opportunity
Lithium — because of its high-energy-per-unit-mass relative to other electrical energy storage systems — is ideal for use in car batteries as well as in laptops, cell phones, and a host of consumer electronic devices.
Lithium batteries have become the front-running rechargeable energy storage medium — particularly for the rapidly growing EV industry — creating a strong demand forecast for lithium.
There is no current replacement for lithium. You may see stories about new battery technologies or about lithium recycling. But they are largely fantasy at this stage.
In all, commitments to invest in lithium-ion batteries and EVs now total an astounding US$90B globally with 40+ automakers moving into the electric/plug-in hybrid vehicle space.
Global lithium demand is expected to rise from roughly 500,000 tonnes per annum currently to upwards of 4 million tonnes per annum by 2030 — an 8-fold increase.
Lithium mines, on the other hand, produced just 100,000 tonnes worldwide in 2021 — a far cry from what’s needed even by today’s standards.
And while the supply of lithium from mining is indeed increasing… it’s happening at a far slower rate than the rise in demand.
That means an escalating supply gap is a near certainty going forward as millions of drivers make the switch to electric-powered cars and trucks.
Recharge Resources Ltd. (CSE: RR)(OTC: RECHF) is aiming to help fill that supply gap via its flagship Pocitos-1 lithium project located in the hotbed of lithium production in Salta, Argentina, and via its Georgia Lake hard rock spodumene lithium project in Ontario, Canada.
At Georgia Lake, the company is awaiting results from its recently completed high-resolution heliborne magnetic survey wherein it will embark on an aggressive spring 2023 field program.
At Pocitos-1, the Recharge team is awaiting brine sample assays on a drill hole that intercepted the target aquifer; the company is simultaneously moving toward an NI 43-101 report on the project.
Earlier, you heard directly from Recharge’s principal geologist Phil Thomas. He says:
“What you want is big, wide, flat layers where you've got lots of brine flowing through defined aquifers. What you don't want is small channels of aquifers. So Pocitos has that characteristic and that was the key.”
The dynamics of lithium mining and resource calculation are also typically far more efficient than in traditional hard rock mining, as Phil explains:
“You might have seen Galan Lithium, an Australian company, where they did two production holes, some geophysics, and then they came up with a proven and probable reserve statement from their inferred and indicated resource statement. So you don't need a lot of exploration like you do with copper and gold where you need to drill with 25-meter intervals and make sure the lithology is consistent. So this is a very fast process.”
Additionally, Recharge has announced a fully-funded drill program for Q1 2023 at the early-stage exploration Brussels Creek copper-gold-palladium project located in British Columbia, Canada.
So needless to say, plenty of shots-on-goal for Recharge Resources shareholders in 2023 and beyond, including upcoming drill programs at multiple projects — all at a miniscule market cap below C$15 million.
The company is also well funded having recently raised $C3.6 million via private placement.
There are a lot of moving parts here… it’s a fast-developing situation… and we have every confidence in the people running the show at Recharge.
In other words, now is a perfect time to start checking out Recharge Resources as results continue to pour in and as the company sets its sights on upcoming drill programs at multiple projects.
A great place to start is Recharge’s corporate website where you can learn more about the properties, the team, and sign up to receive updates directly from the company’s IR department.
Also, click here for more of our ongoing coverage of Recharge Resources, including additional late-breaking interviews with upper management as developments arise.
Recharge Resources Ltd. trades on the Canadian Stock Exchange under the symbol RR and on the US OTC Bulletin Board Exchange under the symbol RECHF.
For even more on Recharge Resources, you can call the company’s IR department at 778-588-5473 or email them at info@recharge-resources.com.
— Resource Stock Digest Research