Following a prolonged period of decline, the lithium market is now experiencing a significant rebound, pointing towards the next phase of a remarkable bull run. Over the past four weeks, the spot price of lithium has undergone a noteworthy surge, and this upward trajectory is expected to continue.
The Chinese lithium carbonate price has nearly doubled since the beginning of April 2023 and several factors could send prices higher, including the escalating demand from the electric vehicle (EV) sector, an increasingly evident supply shortage, and overall improvements in market conditions.
Meanwhile, Chinese EV sales are once again smashing monthly records, signaling the end of the market cooldown and an upcoming China lithium price recovery. Auto giant BYD sold a record 240,220 electric vehicles in May, marking a 14.2% increase from the previous month, while startup Li Auto increased its monthly sales by 10.1% to 28,277, indicating increased demand from the world’s largest EV market.
At the same time, government incentives and policies to boost lithium production and support the transition to cleaner energy solutions are creating a growing need for new domestic supply.
This upward price momentum, sustained government support and growing supply shortage are poised to fuel further growth in the lithium industry and create a positive environment for companies engaged in lithium exploration and extraction.
Developing Two of the Largest Lithium Deposits in the Americas
Right now Albemarle’s Silver Peak is the only producing lithium mine in the United States, however several new projects are being developed across the nation including American Lithium Corp’s (TSXV:LI) (NASDAQ:AMLI) TLC Project, which is located just 3.5 hours drive away from the Tesla gigafactory in Nevada and just 25 miles away from Silver Peak. The company is also developing its Falchani project in Peru, which is estimated to be the world’s sixth-largest hard rock lithium deposit.
The TLC Project is a 100% owned, large-scale “Made in America” lithium claystone deposit situated near the surface, allowing for cost-effective, environmentally friendly mining techniques. In December 2022, American Lithium updated its resource estimate, which significantly increased the lithium resource at the project.
TLC now boasts 4.2 million tons (Mt) of lithium carbonate (Li₂CO₃) in measured resources, 4.63Mt Li₂CO₃ in indicated resources, and 1.86Mt Li₂CO₃ in inferred resources.
American Lithium has continued to make significant headway at both of its lithium projects. In the spring, the company submitted an independent NI 43-101 Technical Report on the Preliminary Economic Assessment (PEA) for the TLC project which was completed by. DRA Global and Stantec Consulting Services, which revealed the project’s potential to become a large, long-term producer of low-cost, high-purity lithium carbonate.
Some of the highlights from the TLC project PEA include base case with robust economics including a NPV8% of $3.26 billion, an after-tax IRR of 27.5% and is projected to bring in approximately $396 million in after tax cash flow annually, producing battery-grade lithium for 40 years.
American Lithium is also making significant progress at its Falchani project in Peru. On May 8, the company announced that the first of three permits for drilling near Quelcaya, 5-6 kilometers west of the Company’s Falchani deposit, has been received from Peruvian authorities, and drilling will begin immediately. Diamond drilling of up to 8,000 m (40 drill holes) is planned. Recent fieldwork discovered outcrop grab samples containing up to 3,272 ppm Li.
This accomplishment marks another step towards the successful completion of the company’s permit application process, which will allow it to drill test numerous new, high-priority lithium prospects. It also validates recent comments from Peru’s new government that the mining sector is now operating “as normal” and supporting the development of American Lithium’s lithium projects and the industrialisation of lithium as a new mineral in Peru.
Between TLC and Falchani, American Lithium boasts a Measured and Indicated (M&I) resource of 9.8 million metric tons Mt of Li₂CO₃ and an additional Inferred resource of 5.66 Mt of Li₂CO₃, positioning the company to play a critical role in the Americas’ transition to clean energy.
For more information about American Lithium Corp. (TSXV:LI) (NASDAQ:AMLI), click this link or visit their website at americanlithiumcorp.com.
Featured Image @ FreePik
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6) This document contains forward-looking information and forward-looking statements, within the meaning of applicable Canadian securities legislation, (collectively, “forward-looking statements”), which reflect management’s expectations regarding American Lithium Corp.’s future growth, future business plans and opportunities, expected activities, and other statements about future events, results or performance. Wherever possible, words such as “predicts”, “projects”, “targets”, “plans”, “expects”, “does not expect”, “budget”, “scheduled”, “estimates”, “forecasts”, “anticipate” or “does not anticipate”, “believe”, “intend” and similar expressions or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved, or the negative or grammatical variation thereof or other variations thereof, or comparable terminology have been used to identify forward-looking statements. These forward-looking statements include, among other things, statements relating to: (a) revenue generating potential with respect to American Lithium Corp.’s industry; (b) market opportunity; (c) American Lithium Corp.’s business plans and strategies; (d) services that American Lithium Corp. intends to offer; (e) American Lithium Corp.’s milestone projections and targets; (f) American Lithium Corp.’s expectations regarding receipt of approval for regulatory applications; (g) American Lithium Corp.’s intentions to expand into other jurisdictions including the timeline expectations relating to those expansion plans; and (h) American Lithium Corp.’s expectations with regarding its ability to deliver shareholder value. Forward-looking statements are not a guarantee of future performance and are based upon a number of estimates and assumptions of management in light of management’s experience and perception of trends, current conditions and expected developments, as well as other factors that management believes to be relevant and reasonable in the circumstances, as of the date of this document including, without limitation, assumptions about: (a) the ability to raise any necessary additional capital on reasonable terms to execute American Lithium Corp.’s business plan; (b) that general business and economic conditions will not change in a material adverse manner; (c) American Lithium Corp.’s ability to procure equipment and operating supplies in sufficient quantities and on a timely basis; (d) the accuracy of budgeted costs and expenditures; (e) American Lithium Corp.’s ability to attract and retain skilled personnel; (f) political and regulatory stability; (g) the receipt of governmental, regulatory and third-party approvals, licenses and permits on favorable terms; (h) changes in applicable legislation; (i) stability in financial and capital markets; and (j) expectations regarding the level of disruption to as a result of CV-19. Such forward-looking information involves a variety of known and unknown risks, uncertainties and other factors which may cause the actual plans, intentions, activities, results, performance or achievements of American Lithium Corp. to be materially different from any future plans, intentions, activities, results, performance or achievements expressed or implied by such forward-looking statements. Such risks include, without limitation: (a) American Lithium Corp.’s operations could be adversely affected by possible future government legislation, policies and controls or by changes in applicable laws and regulations; (b) public health crises such as CV-19 may adversely impact American Lithium Corp.’s business; (c) the volatility of global capital markets; (d) political instability and changes to the regulations governing American Lithium Corp.’s business operations (e) American Lithium Corp. may be unable to implement its growth strategy; and (f) increased competition.
Except as required by law, American Lithium Corp. undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future event or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. Neither does American Lithium Corp. nor any of its representatives make any representation or warranty, express or implied, as to the accuracy, sufficiency or completeness of the information in this document. Neither American Lithium Corp. nor any of its representatives shall have any liability whatsoever, under contract, tort, trust or otherwise, to you or any person resulting from the use of the information in this document by you or any of your representatives or for omissions from the information in this document.
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