February 15, 2022
Lake Resources NL (ASX:LKE, BUY, A$2.20 target, David A. Talbot) has begun drilling at its 100%-owned Olaroz, Cauchari, and Paso lithium projects in Argentina under its ‘Target 100’ program. The objective of Target 100 is to produce 100,000 tpa lithium by 2030 to address the anticipated market supply deficit. Drilling kicks off with a 10-hole (4,000m) program and an allocated budget of US$15M. Notably, these projects are in the vicinity of the producing Olaroz operations of Allkem Ltd. (ASX:AKE, Not rated) and Chauchari operations of Lithium Americas (TSX:LAC, Not Rated) – Ganfeng (SZSE:002460, Not Rated) JV. In our view, this program complements well the planned production at Lake’s flagship Kachi Li-brine project in Argentina. In the recent DFS, Lake doubled the production guidance at Kachi to 50k tpa LCE (read more). This was done to tap the large resource base at the property. Notably, the UK and Canadian Export Credit Agencies have committed to funding 70% of the initial and expansion CAPEX at the project. Additionally, there has been a significant demand by the off-take partners to secure their supply chain. The company is confident that it will be able to meet this demand by using the direct lithium extraction technology of its technology partner, and 25% owner in the project, Lilac Solutions (read more). Read more