Mr. David Greenway of Recharge reports
RECHARGE RESOURCES EXECUTES OPTION TO ACQUIRE 100% INTEREST IN THE CONTIGUOUS POCITOS 2 LITHIUM BRINE PROJECT AFTER THE SUCCESSFUL 2022 DRILLING AT POCITOS 1 INCREASING THE SIZE OF THE PROJECT AND POTENTIAL RESOURCE BY OVER 65%
Recharge Resources Ltd. has signed an option agreement with Spey Resources Corp. whereby the company may acquire an up-to-100-per-cent undivided interest in the Pocitos 2 project, a 532-hectare lithium brine project located just outside of Salta, Argentina, and contiguous to the company's continuing operations on the Pocitos salar.
Previous surface sampling, trenching and VTEM geophysics carried out in 2018 suggest the continuity of the targeted lithium brine aquifer continuing from the Pocitos 1 block through the Pocitos 2 block with Pit 10 from trenching on the Pocitos 2 block having the highest trench sample at 181 parts per million lithium, the highest lithium value found on the Pocitos salar to date.
Drilling from the company's 2022 drill campaign at Pocitos 1 assayed 169 ppm and, over a two-week period, averaged 161 ppm lithium. The 2022 well exceeded Recharge's technical team's expectations and that of the measured lithium content of the 2018 discovery wells. Pocitos 2 is permitted to drill two additional wells immediately at Recharge's go-ahead.
This is another milestone in the company's endeavour to build an up-to-20,000-tonne Ekosolve lithium extraction plant at the Pocitos project to supply Richlink Capital Pty. Ltd. up to 20,000 tonnes of lithium chloride/carbonate per year, as previously announced under a letter of intent, and, with the potential increased size of the resource, to improve both the economics and the mine life.
Lithium is selling in the spot market at 477,500 yuan per tonne or the equivalent of $70,752 (U.S.) per tonne according to the Trading Economics website (Jan. 30, 2023).
As previously announced, the basis for the National Instrument 43-101 report is well under way after Mr. Thomas set up the drill program in Argentina, when he was there in November, 2022, and again in January, 2023, to measure review core, flow rates and assays to create the anticipated NI 43-101-compliant report. Mr. Thomas, BSc geol, FAusIMM MAIG, has spent the past 22 years exploring for lithium brines, including building and operating a pilot plant for production at Rincon salar (sold to Rio Tinto for $825-million (U.S.)). He and his team developed the Pozuelos salar, producing an indicated and inferred resource, from four exploration wells (recently sold to Ganfeng for $962-million (U.S.)).
Mr. Thomas is independent of the company and is not a shareholder of Recharge. Mr. Thomas visited the property to view the core between Jan. 15 and Jan. 22, 2023.
The acquisition of these additional 532 hectares, with some additional exploratory work, has the potential to increase the size of the resource at Recharge's Pocitos project by over 65 per cent.
Chief executive officer and director David Greenway stated: "The world needs more lithium, and Recharge's now larger Pocitos project continues to present that it may be a contributing puzzle piece to this growing concern. The future of the Pocitos project continues to improve, and we couldn't be more excited by the continued fantastic results. Increasing the footprint with the highest lithium content assay on the entire salar, with geophysics suggesting the continuation of the target aquifer, is a significant milestone both from the perspective of the potential size of the resource, but also as we begin to take into consideration water disposal after lithium extraction, plant footprint and other engineering milestones going forward. This is a fantastic achievement for Recharge and stakeholders as we move toward our next goals of establishing an NI 43-101-compliant mineral resource, a scoping study of the project and formalizing our offtake agreement for lithium carbonate."
Under the terms of the agreement, Recharge may exercise the option and earn a 100-per-cent undivided interest in the property, subject only to the underlying royalty, by paying to the optionor cash totalling $744,800 (U.S.) and issuing share payments totalling $500,000 (Canadian).
Recharge further agreed that in the event Recharge exercises the option, it shall, and shall be obligated to, pay an additional $500,000 (Canadian) in cash or shares issued at the market price of the common shares on the date of issuance (such term as defined in the policies of the Canadian Securities Exchange).
The determination as to whether to pay such payment in cash or shares is within Recharge's discretion to Spey within 18 months of the date of execution.
A royalty of 7.5 per cent of the FOB price of lithium carbonate or other lithium compounds sold on the project shall remain payable pursuant to an underlying agreement.
All common shares issued under the agreement will be subject to a four-month hold period under applicable Canadian securities laws.
About Pocitos 1 lithium brine project
The Pocitos project is located approximately 10 kilometres from the township of Pocitos, where there is gas, electricity and Internet services. Pocitos is approximately 1,352 hectares and is reachable by road. Collective exploration totals over $2.0-million (U.S.) developing the project, including surface sampling, trenching, TEM geophysics and drilling three holes that had outstanding brine flow results. Locations for immediate follow-up drilling have already been designed and identified for coming exploration.
Lithium values of up to 169 ppm from laboratory analysis conducted by Alex Stewart were recorded during the project's drill campaigns as recent as December, 2022. A double packer sampling system in HQ diamond drill holes drilled to a depth of up to 409 metres. The flow of brine was observed to continue for more than five hours. All holes had exceptional brine flow rates.
Phillip Thomas, BSc geol, MBusM, FAusIMM, MAIG, MAIMVA, (CMV), a qualified person as defined under NI 43-101 regulations, has reviewed the technical information that forms the basis for portions of this news release, and has approved the disclosure herein.
About Recharge Resources Ltd.
Recharge is a Canadian mineral exploration company focused on exploring and developing the production of high-value battery metals to create green, renewable energy to meet the demands of the advancing electric vehicle and fuel cell vehicle market.
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