With EV sales set to triple by 2026 and auto giants committing tens of billions of dollars in a massive push to boost battery production for American EVs, the race to the finish line for new lithium supplies will help define this space in 2023.
The defining venues for North America will be the U.S. northwest and Canada, where explorers are starting to return impressive drilling results that could set the stage for the next phase of lithium supply. This is paramount to meeting soaring demand.
That’s why lithium mining stocks have been flying.
Patriot Battery Metals Inc (TSX:PMET) is up over 174% year-to-date…
Lithium Ionic Corp (CVE:LTH) has gained nearly 60% in the same time period, and Lithium Bank Resources Corp (CVE:LBNK) is up over 31% …
Lithium Americas Corp (NYSE:LAC) is up 37% YTD and giant Albemarle (NYSE:ALB) has surged over 22%.
And now, exploration and development company —EMP Metals Corp (CSE:EMPS) (OTCQB: EMPPF) —has released drilling results that represent the highest-known recorded lithium brine concentrations found in Canada to date, according to the company and based on publicly available data.
EMP is drilling in Canada’s Saskatchewan, a region quickly becoming one of the biggest rewarders for investors in lithium.
Saskatchewan pretty much offers it all: government support, pre-existing oil and gas infrastructure and expertise, as well as key lithium in formations that are closer to the surface than anything found in Alberta, making it potentially more cost effective to extract.
Source: EMP Metals
EMP is focused on low-cost, high-impact lithium exploration projects, and the Duperow Formation, where much of the lithium investor attention is now focused, is exactly that. This is where EMP is drilling on over 212,000 acres, holding 37 permits.
Saskatchewan’s Duperow Formation may be shaping up to be the crown jewel of North America’s lithium future. The Duperow is an extensive reservoir with aquifer support that is laterally equivalent to Alberta’s Leduc Formation. But it has a distinct advantage over the Leduc with significantly higher grades of lithium being discovered in the Duperow. Further, shallower depths and typically lower concentrations of hydrogen sulfide (“sour gas”) suggest potential for direct lithium extraction approaches which allow for more efficient, economic, and sustainable, production processes compared to evaporation and hard-rock mining.
2023 Is All About New Lithium Drilling Results
Swab tests on EMP’s 2-22-007-9W2/0 well at Viewfield confirmed high lithium concentrations ranging from 94 to 259 mg/1 within 6 zones targeted for future development within the Duperow Formation:
- The Wymark E zone tested an average of 220 mg/l from a 3.61 m thick zone with average porosity of 14.2%.
- The Wymark D zone tested an average of 259 mg/l from a 10.6 m thick zone with average porosity of 20.4%.
- The Wymark C zone tested an average of 167 mg/l from a 10.3 m thick zone with average porosity of 14.1%.
- The Wymark B zone tested an average of 97 mg/l from a 16.4 m thick zone with average porosity of 16.2%.
- The Wymark A zone tested an average of 94 mg/l from a 8.9 m thick zone with average porosity of 14.0%.
- The Saskatoon A zone tested up to 152 mg/l from a 10.6 m thick zone with average porosity of 14.0%.
In flow tests, all zones showed lithium concentrations ranging from 200-203 mg/L when tested together.
While these numbers might not mean much to anyone’s who’s not a geologist, when you compare them to other drilling results in Canada to date, it looks like good news for investors.
According to EMP, to date, the highest concentrations recorded in Canada have come from Saskatchewan and the government’s Midale test well, also in the Duperow Formation, which showed lithium concentrations of 190 mg/L.
That means that EMP’s latest lithium brine test results appear to be of higher concentrations than anything previously recorded by the Canadian government.
Drilling results like this for a new entrant in Canada’s lithium space could help push it to the front of the line.
The Momentum Keeps Building
Last year, EMP started to gain solid traction with an aggressive drill campaign on its 212,000 acres in Canada’s Saskatchewan region. That early drilling paid off. It’s first test well on its Mansur Permit Area returned impressive concentrations.
Just two weeks ago, EMP completed the flow test of its second Mansur test well, showing concentrations of up to 148 mg/L.
So far, EMP is ticking all the right boxes …
It’s a new entrant in the number one region for new lithium exploration in North America—and at a time when the energy transition is all about securing supply and auto giants are desperate for lithium security.
Tesla plans to triple lithium-ion cell output at its Reno, Nevada gigafactory …
That’s no surprise when you look at Q4 results. Tesla produced over 439,000 vehicles and delivered over 405,000 vehicles, with deliveries surging 40% in 2022 and production soaring 47% YoY.
Scoring the highest lithium concentrations in Canada to date, could give this stock some significant impetus and investors will be watching what happens next very closely. EMP’s 212,000+ acres could become some of the hottest lithium real estate around.
Spot prices for lithium carbonate skyrocketed for nearly two years until November last year, surging nearly 12X from early 2021 to November 2022, with demand outpacing supply heavily. It’s meant huge profits for miners. By December, those prices started to decline somewhat, but 2023 is still expected to see high-priced lithium.
The trick here for new entrants is not betting everything on the present if Lithium prices do ease despite the ongoing supply crunch and strong global EV sales.
That’s where EMP shines. That’s why EMP is not just drilling fast and aggressively to get to that new supply …
It’s why the company has scooped up so much valuable acreage targeting the Duperow Formation, where direct lithium extraction is possible for lower costs and a more sustainable supply relative to current evaporation and hard-rock mining operations. That’s what makes this a true lithium hotspot.
With the best drilling results to date in—not just for EMP but for all of Canada—momentum is expected to pick up pace further.
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