Mexico is gearing up to become the dominant supplier of lithium carbonate in Central America. The increase in price of lithium carbonate and hydroxide is driven by increasing demand for lithium -ion batteries for both the electric vehicle and other mobile devices.
Within Mexico is the Salar del Diablo, which is one of the larger salars to be drilled this year. The salar sites located in the State of Baja California, Mexico and 35 kilomters from the town of San Felipe The property spans 103,450-hectares or 400 square miles and has the potential for a lithium brine discovery, not unlike deposits found in Argentina and Chile.
Vancouver, BC-based exploration and development company One World Lithium (CSE:OWLI, OCTQB:OWRDF) has the right to earn and purchase a 90 per cent working interest in the Salar del Diablo project with a mission to drill the salar and becoming a low-cost producer with a long term supply contract of 30 or more years.
While the company has already drilled the first two holes in the Salar del Diablo property, One World Lithium is moving full speed ahead and has begun drilling the next two holes effective April 21, which will be located 50 kilometres to the south of other drilling.
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The first hole will be DDH-3, which is in a preferable location as it is situated in a region of historic and current hydrothermal activity. This is often the delivery system for bringing lithium to a brine.
In tandem with this, One World Lithium is also advancing its potential critical fluid separation technology, which has the potential to separate lithium carbonate and many of its related elements.
With a busy year ahead for One World Lithium, the company is making a memorable name for itself and is one that investors won’t want to miss out on.
The significance of the Salar del Diablo property
Tim Brock, a consultant, and a founding shareholder with One World Lithium, told Stockhouse Editorial in an interview that the property is only 200 metres above sea level — which is incredibly low when compared to other producers in South America that are between 1,500 to 2,500 meters above sea level.
Before any drilling on the project, only 14 per cent of the property had been explored by geochemical sampling, geophysical survey, geological mapping, and satellite imagery for structural analysis.
Although there have been some roadblocks over the last year in terms of continuing Phase 3 of the drilling program — largely because the price of lithium carbonate was low until late 2020. However, in 2021 the price of lithium carbonate ha steadily been rising and with renewed investor interest, lithium exploration companies are being funded and One World Lithium is back in the saddle.
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A 12-hole drill program began on May 24, 2019 to intersect geophysical, geochemical and geological targets. The program was terminated on June 13, 2019 as the first five holes did not drill deep enough to test the targets.
By October 2019, the company started a four-hole drill program, at the recommendation of a new operator, to reach a depth of 600 metres per hole.
Hole DDH-1 was drilled adjacent to the previous first hole and DDH-2 was drilled 12 kilometres to the south and adjacent to the old 11th hole.
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As the company already drilled the first two boreholes in late 2019, the remaining two boreholes of the four-hole program are currently being drilled. The four holes will total roughly 2,4000 metres, or 7,875 feet.
With the Salar del Diablo being one of the world’s larger salars to be drilled in 2021, Brock said its potential is “enormous” for the company. Once drilling sample results have been assayed, all results from DDH -1 to 4 will be released at the same time.
As One World Lithium started drilling at the south end of the property on April 21, it has the potential to be located within a hydrothermal system.
Brock told Stockhouse Editorial that what this essentially means is the property boasts similarities to Millennial Lithium’s (TSXV: ML) Pasto Grande deposit, Galaxy Resources’ (TSX:GALXF) Sal de Vita deposit and Lithium Americas’ (TSX: LAC) Cauchari Olaroz deposit which each deposit having a valuation of roughly US$1 billion.
In other words, One World Lithium’s asset has the potential to be in the same league as these properties — which bodes well for not only the company but investors. too, as One World Lithium’s property positions itself among the greats.
Behind the critical fluid separation technology
The critical fluid separation technology is well-positioned to change the face of the lithium sector.
Case in point, its advantages include the potential that evaporation ponds won’t be required, and lithium carbonate may be shipped directly to the consumer who may elect to use battery grade lithium using an ion exchange procedure. . Brock said that the technology is undergoing a proof of concept, which, in addition to the above, is faster and less expensive than using traditional evaporation ponds and will be used in commercial applications.
Following the successful completion of the proof of concept, the company will then own 100 per cent of the technology patents and then licence the technology to current and future producers of lithium from a brine.
“[One World Lithium] is very excited about the technology because it does have the potential to be a game-changer in the lithium industry,” Brock said.
The team behind One World Lithium
One World Lithium's team is backed with decades of experience in the mining industry — although the company's strengths can be found in every area of its business.
The company is led by Doug Fulcher, president, and CEO, who has 40 years of experience in the exploration and development of several projects.
Fulcher’s experience includes several years as Abacus Mining and Exploration’s (TSXV:AME) CEO, leading the company to drilling a resource at the Ajax copper-gold-porphyry project.
He also negotiated a joint venture with the largest copper producers in the world, KGHM Polska Miedź S.A in Poland, which included $200 million in production expense with Abacus retaining a 20 per cent carried interest.
Fulcher is also the former CEO of Maritime Gold in which he led the company in bringing the Hammer Down project back to production.
One World Lithium’s CFO is John Hamilton, who has 40 years of experience in public and private companies in both Canada and the U.S.
Leading One World Lithium’s exploration is Kevin Milledge, who has more than 35 years of experience managing programs in North, Central and South America. Some of his exploration and development programs have taken place in the states of Baja California.
Tim Brock is One World Lithium’s consultant and founding shareholder, whose experience includes sponsorship for start-up companies — both public and private — in the U.S. and Canada, as well as experience with investor relations. Several Companies he sponsored traded between C$7 and $27 per share.
What's next for One World Lithium
As the company continues advancing its Salar del Diablo property, One World Lithium has other milestones on the horizon this year.
Additional milestones for investors to watch for this year relate to the company’s lithium separation technology. Once the proof of concept is completed, the company will be able to file for applicable patents and design a pilot plant.
Moving into 2022, following a successful pilot plant, One World Lithium anticipates licensing the technology to present and future lithium-brine producers — the license agreement may be a significant generator of cash flow for One World.
Additionally, One World Lithium remains bullish in the lithium industry, with Brock saying the company is in the right place at the right time and with the right projects.
Brock said the forecast for lithium carbonate (the spot price for lithium) is projected to go as high as $27,000 per tonne by 2025 which will be primarily driven by the electric vehicle market.
In terms of lithium demand, it is estimated that will go up to 1.6 million tonnes of lithium carbonate and hydroxide and by 2027, which Brock said will put a lot of pressure on the lithium market and to the benefit of One World Lithium.
Investor takeaway
As the Salar del Diablo project moves ahead with drilling — in addition to being one of the larger salars to be drilled this year — One World Lithium will cement itself as a unique play in the lithium market.
The company’s focus in Mexico also makes One World Lithium stand out because of the property’s potential to be located within a hydrothermal system, not unlike those found in South America.
As the company moves full speed ahead this year with the Salar del Diablo project — and as One World Lithium continues to advance its critical fluid separation technology, which maybe a game-changer for the lithium sector as a whole — the company has plenty in store for investors to keep an eye out for.
For more information, please visit
oneworldlithium.com.
FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.