VSA Capital Market Movers – American Lithium


VSA Morning Miner, 10/09/21

American Lithium (CVE:LI)

American Lithium (CVE:LI) has announced further positive testwork results; this time in relation to the front end of the process. As with other recent testing, the work was undertaken in Peru using continuous gravity Falcon concentrators to assess their potential for use in beneficiating the ore before it enters the main part of the processing.

In this batch of testwork the gravity concentration delivered a 50% increase in grades to 1,671ppm Li retaining 88% of the lithium in 60% of the mass. Through the concentration process it is usual for some lithium to be lost but this is more than offset by the benefits of the waste reduction and consequent increase in grades and is broadly in line with the results that the company achieved from earlier investigatory testwork around beneficiation. This particular round involved crushing, a series of concentrator passes, repulping and scavenging and took around 45 minutes.

The rationale for this is clear as processing higher grade feedstock through the main part of the process will reduce costs through lower reagent consumption and lower throughput; reagents being amongst the highest contributors to the cost base for lithium processing. This will both improve plant efficiency from a cost base but also an environmental standpoint.

We reiterate our Buy recommendation and C$6.95/sh. target price.

Oliver O’Donnell, CFA, Head of Research & Natural Resources Analyst | T: +44 (0)20 3617 5180 | E: [email protected]

Paul Renken, Senior Geologist | T: +44 (0)20 3005 5011 | E: [email protected]

VSA Capital Research | T: +44 (0)20 3005 5000 | E: [email protected]

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