Wednesday, 17 June 2015

International Lithium Mariana J/V With Ganfeng: Orocobre Olaroz Lithium Update.


  We are following very closely the development at Olaroz by Orocobre. Today company is reporting very encouraging news on its production update and the market conditions. International Lithium and Ganfeng Lithium J/V operations on Mariana are moving towards pilot plant stage and we are very encouraged with our initial results.

Mr Li Chairman of Ganfeng Lithium and Mr Klip President of International Lithium.

International Lithium:

International Lithium Corp. Updates on Drilling Programs in Argentina and Ireland

    Vancouver, B.C. June 1, 2015: International Lithium Corp. (the "Company" or "ILC") (TSX VENTURE: ILC.V) is pleased to provide an update on the exploration and drilling programs at the Mariana Project in Argentina and the Avalonia Project in Ireland.

    Mariana Project - Salta, Argentina

    A 171 metre drill hole ("MA15-09PW") was completed near the centre of the salar. Core samples recovered give a more detailed stratigraphic section than was possible through previous reverse circulation drilling. Core logging of the two aquifers in the upper levels of the salar confirms that the upper aquifer consists of granular and massive halite, interbedded with silt and fine tuffs from surface to a depth of 30 metres and that the second aquifer, consists of medium to coarse grained gravels in a sandy matrix from 53 to 119 metres depth. MA15-09PW ended in approximately 52 metres of massive halite approximately 50 metres deeper than previous drilling. A borehole geophysical survey is interpreted to confirm this stratigraphy based on the resistivity profile.

    Drill hole MA15-09PW is nearing completion in preparation for pump tests. These tests will provide hydrological characteristics of the two brine aquifers under pumping conditions and their response after pumping. These are important characteristics that are used to determine the potential rate at which brine could be drawn from the upper aquifers. This will be the first pump test conducted at the project.

    The results to date confirm that Salar de Llullaillaco is a halite dominant, mature salar that bears a significant stratigraphic resemblance to prominent salars in the region including Atacama, Rincon and Uyuni. The Mariana project is a partnership of Ganfeng Lithium Co. Ltd., ("GFL") and ILC with 100% ownership of Salar de Llullaillaco in Salta province.

    Mr. Kirill Klip, President, International Lithium Corp. comments, "We are highly encouraged by what we are learning about the thick brine aquifers at Mariana. We look forward to completing the pump test which will give us a sense of the potential productivity of wells in these aquifers and we are confident that our plan to acquire these key preliminary hydrological results prior to a mineral resource estimation is both an expeditious and cost effective approach toward an initial production assessment." Read More.

    Please carefully read my legal disclaimer, all technical data provided by Orocobre is for information only, you should not be relying on it to make any investment decisions. "Qualified Person"  of International Lithium as defined under NI 43-101 was not able to verify all these information.

    "…Sales Orders

    Following the announcement on 29th April, commercial shipments of lithium carbonate have continued to be dispatched from the Olaroz Lithium Facility to Europe and Japan and there are forward sales orders in the system to customers in the USA and South Korea.

    Commercial samples have been dispatched and continue to be dispatched to customers as the final stage of product qualification. As previously advised, the time period for final sample approval, where required, varies from 1 week to 3-6 months depending on the specific customer requirements.

    All forecast production for CY2015 has now been fully committed, earlier than our previous guidance of 30 June 2015, and customers are awaiting delivery.

    The main customer concern is long term security of quality supply and the Olaroz Lithium facility will fulfil this need.

    Market Conditions

    As previously advised, the supply side of the lithium market continues to tighten due to a combination of existing suppliers effectively being at capacity and strong market demand. Existing suppliers announced market price increases of approximately 10% for 2015 and their recent quarterly reports indicate that these announced price increases have been achieved.

    Our market experience is that lithium carbonate prices are continuing to increase from a level of $5,000-$5,500/tonne last year to currently be in excess of US$6,000/tonne.

    Plans for new and expanded lithium battery factories have been announced by Tesla, Foxconn, Samsung, LG and BYD. Market demand is being driven by more mobile devices being sold than ever before, underpinned by the growth of emerging markets, increasing momentum in the electric vehicle sector as most brands announce electric models and now the introduction of the solar-lithium battery home energy solution. These new applications for lithium batteries have not yet been quantified for their effect on lithium demand but some research groups are suggesting a potential doubling of market size by 2020.

    There are no new entrants on the supply side and no capacity expansions outside China due to come on line until at least 2016. The market growth rate projected by independent consultants is 10% year on year for at least the next few years. Customers currently value security of supply very highly and are focused on the diversification of their supply chain to manage risk.

    Managing Director Comments

    Managing Director, Richard Seville, said, "We are pleased to be dispatching both battery grade and technical grade product to fulfil customer orders and final sample requirements. We also acknowledge that our production ramp up has been slower than anticipated due to a variety of plant operating issues. The systematic identifying of bottlenecks to be rectified will still enable us to achieve the nameplate monthly production rate of 1,450 tonnes within Q4 2015. We have had to invest some capital in both plant rectification and additional boiler capacity, which was critical to allow the plant to reach its potential. As the ramp up program continues, we will undoubtedly learn more about the intricacies of the process as we develop our operating practices and drive toward maximizing plant efficiency.

    In regard to the market, the lithium market continues to demonstrate very strong demand growth and market price increases of ~10% this year. The market is forecast to grow at ~10%, prior to including the potentially huge impact of the proposed new battery factories or battery plant expansions proposed by Samsung, LG, BYD, Foxconn and Tesla.

    Although we are disappointed with the delays, we are heartened by the recent progress and the strengthening market dynamics. The lithium market is certainly in an exciting phase and we look forward to growing our business in line with this market growth".…