{"id":104071,"date":"2017-03-28T13:18:11","date_gmt":"2017-03-28T17:18:11","guid":{"rendered":"http:\/\/countingpips.com\/?p=104071"},"modified":"2017-03-28T13:18:11","modified_gmt":"2017-03-28T17:18:11","slug":"wealth-minerals-ltd-hottest-salar-in-chile","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2017\/03\/wealth-minerals-ltd-hottest-salar-in-chile\/","title":{"rendered":"Wealth Minerals Ltd, Hottest Salar in Chile"},"content":{"rendered":"
March 28, 2017<\/div>
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By<\/strong>\u00a0Peter Epstein, CFA, MBA \u00a0 \u00a0epstein.peter4@gmail.com<\/a>\u00a0\u00a0 \u00a0Epstein Research<\/a><\/b><\/p>\n

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In this article I discuss a Lithium\u00a0(\u201cLi\u201d)\u00a0junior that has successfully locked down, via option agreements, several key lithium\u00a0properties \/ projects\u00a0in Chile (mgmt. still looking for more<\/em>) and owns or controls 4 precious \/ base metal projects in Mexico, Peru & Canada.\u00a0 Each of the Company\u2019s assets is good to very good, but my focus is on the crown jewel.\u00a0 On March 17,\u00a0Wealth Minerals [TSX-V: WML] \/ [OTCMRKTS: WMLLF]\u00a0delivered a\u00a0NI 43-101\u00a0Technical Report<\/a>\u00a0(the \u201cReport\u201c) on its optioned\u00a0Proyecto\u00a0Atacama Lithium (\u201cPAL\u201d)\u00a0project in the northern part of the\u00a0Salar de Atacama\u00a0(the \u201cSalar\u201c), located ~220 km east of the Chilean city of Antofagasta.\u00a0\u00a0The Salar itself is the largest in Chile and 3rd largest in the world, measuring about 85 x 50 km = 4,250 sq. km.\u00a0\u00a0The Report\u00a0represents an important milestone in the Company\u2019s early-stage Li\u00a0exploration activities. \u00a0{See\u00a0Corporate Presentation<\/a>}<\/div>\n<\/header>\n
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For non-experts, like myself, in\u00a0hydrology \/ hydrodynamics, chemistry, geochemistry, geology, hydrogeology, volcanology,\u00a0<\/i>stratigraphy, etc.,\u00a0<\/em>I\u2019ve condensed roughly 10,000 words, maps, charts, images & schematics into a few key takeaways.<\/p>\n

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Wealth Minerals\u2019 NI 43-101 Technical Report\u2026 in Under 500 Words<\/h3>\n

Wealth\u2019s exclusive option on a 100% royalty-free Interest in, and to, the\u00a0PAL\u00a0project in Chile consists of 144 exploration mining concessions covering\u00a046,200 hectares<\/u>\u00a0(~114,160 acres = 462 sq. km \/ 178 sq. miles<\/i>) in the northern part of the\u00a0Salar.\u00a0 The\u00a0PAL\u00a0project abuts claims held by\u00a0SQM\u00a0[NYSE: SQM]\u00a0&\u00a0Albemarle Corp\u2019s [NYSE: ALB], subsidiary\u00a0Rockwood Lithium,\u00a0roughly\u00a030 km & 50 km north, respectively, of those companies\u2019 world-class operations. \u00a0NOTE:\u00a0\u00a0{46,200 contiguous hectares is a huge land position, larger than that of any other (entire) salar in Chile<\/em>}.<\/p>\n

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The principal origin of lithium is interpreted to be surface & subsurface lithium-bearing geothermal waters from the\u00a0El Tatio Geyser Field<\/u><\/em>\u00a0situated north of the Salar, flowing south onto concessions controlled by\u00a0Wealth Minerals Chile, (\u201cWMC\u201d), then onto SQM\u2019s \/ Albemarle\u2019s concessions & production facilities.\u00a0 The chemistry of the brines in the south is said to be, \u201calmost identical\u201d to that of the geothermal fluids of El Tatio, strongly suggesting those mobilized fluids are the main source of lithium & potassium\u00a0(\u201cK\u201d)\u00a0in the Salar.\u00a0 From the Technical Report,\u00a0Section 6.0, page 18,<\/p>\n

\u201c\u2026.because there\u2019s been Li & potassium production from brines located in the southern part of the Salar, and because there has been significant development of deep water sources for nearby mining activities\u00a0<\/em>(copper mines Escondida & Zaldivar, among others), significant studies of the geology, hydrogeology and natural resources are available\u00a0for the region.\u00a0 These regional studies have been carried out by several third-party private companies and by Chilean agencies.\u00a0 As well, numerous cooperative assessments of geology and hydrogeology have been carried out by international scientific agencies.\u201d<\/em><\/p><\/blockquote>\n

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Whereas SQM & Albemarle are harvesting near-surface brines, WMC\u2019s target zone is in\u00a0subsurface aquifers several hundred meters deep<\/u><\/em>.\u00a0\u00a0NOTE:\u00a0\u00a0{the company\u2019s goal is to identify<\/em>\u00a0similar brine chemistry at depth, as that of nearer-surface brines being extracted 30-50 km to the south.<\/em>}\u00a0\u00a0There has been no exploration whatsoever for Lithium on the northern part of the Salar, including the\u00a0PAL\u00a0project.\u00a0 WMC\u2019s Technical Report offers 10 recommendations for a Phase 1 exploration program;<\/p>\n

i) consultation with a geophysical contractor, ii) confirm methodology, iii) consider the use of Time Domain EM, iv) determine sedimentary regime, v) consider gravity survey to determine basin configuration, vi) consider Magneto Telluric methodology for deep target evaluation, vii) conduct geophysical programs, viii) initiate community relations programs, ix) prepare reports & analysis to develop drill targets and x) permit & drill 5 test holes.<\/em><\/p><\/blockquote>\n

The above mention steps are estimated to cost just $550k.\u00a0 The Report\u2019s author concluded that although the\u00a0PAL\u00a0project is early-stage, exploration for lithium resources is warranted for the following reasons,\u00a0section 1.0, page 5;<\/p>\n

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\u201c1)\u00a0\u00a0Lithium-rich brines produced in the northern part of the Salar flow to the south, across the\u00a0PAL\u00a0project. \u00a02)\u00a0\u00a0Sustained production of lithium, potassium & byproducts has occurred in the Salar since the 1970\u2019s from properties contiguous to the\u00a0PAL\u00a0project. \u00a03)\u00a0\u00a0Regional and multidisciplinary studies by several companies and government agencies have confirmed the similarity of geology and hydrogeology of the northern and southern parts of the Salar<\/u>. \u00a04)\u00a0\u00a0Although not necessarily an indication of brine potential, surface sampling of sediment & surface waters returned anomalous lithium concentrations.\u201d<\/em><\/p><\/blockquote>\n<\/div>\n<\/div>\n<\/div>\n

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Above is a comparison chart of well known South American salars. \u00a0NOTE: \u00a0{the metrics associated with \u201cSalar de Atacama\u201d are those of known producers SQM & Albemarle, there\u2019s been no exploration on WMC\u2019s concessions<\/em>}.<\/p>\n

Wealth Minerals has locked up a very large block of\u00a0contiguous exploration concessions in northern Chile, host to the undisputed lowest-cost lithium (brine, hard rock or clay<\/em>) operations in the world.\u00a0 There are at least 18 publicly-listed, pre-production Li juniors with property or project interests in Argentina.\u00a0 There are just 4, (2 of which\u00a0Bearing Resources [TSX-V: BRZ]\u00a0and\u00a0Lithium Power Intl. [ASX: LPI]\u00a0are partners on the same project<\/em>), focusing on Chile. \u00a0LiCo Energy\u00a0[TSX-V: LIC]\u00a0is another junior in Chile with an option on exploitation concessions (plus<\/em>\u00a0it has significant Li assets in Nevada and promising cobalt assets in Canada<\/em>).\u00a0 Both countries will be top 3 or 4 Li suppliers.\u00a0 The question is, which juniors will break into the ranks of SQM, Albemarle &\u00a0FMC Corp. [NYSE: FMC]\u00a0in South America\u2019s Lithium Triangle?<\/p>\n

There are several contending projects in Argentina, most notably\u00a0Lithium\u00a0America\u2019s [TSX: LAC]&\u00a0SQM\u2019s joint venture\u00a0Cauchari-Olaroz\u00a0project in Jujuy Province and\u00a0Galaxy Resources\u2019 [ASX:GXY] Sal de Vida\u00a0project in\u00a0Salar del Hombre Muerto.\u00a0 As mentioned, the race is on among over a dozen other new entrants there.\u00a0 By contrast, if one believes as I do that new producer(s) will emerge in Chile, then Wealth Minerals\u2019\u00a0PAL,\u00a0Lithium Power\u2019s\/Bearing Resources\u2019\u00a0Maricunga\u00a0and LiCo Energy\u2019s\u00a0Purickuta\u00a0(located in the same Salar de Atacama<\/em>) projects are virtually the\u00a0only games in town(among publicly-listed companies<\/em>).<\/p>\n

The Report explains lithium production methodology at active production sites on the Atacama Salar in\u00a0section 7.3, page 23:<\/p>\n

\u201cThe production method utilized by SQM and Rockwood is: lithium-containing brine is\u00a0pumped out of the lithium-potassium-bearing brine aquifer into evaporation ponds,\u00a0where it\u2019s concentrated by evaporation. The brine is further purified on its way through\u00a0the system by continued evaporation, when the brine is pumped through a cascade of\u00a0ponds where impurities or by-products are crystallized and removed. Main by-products\u00a0are potash for the fertilizer industry and bischofite used for road paving. During the\u00a0evaporation process, the lithium concentration is increased from about 2,000 ppm to up\u00a0to 60,000 ppm (6%) in the final brine. The final brine is transported to a processing plant\u00a0for further purification and processing to yield lithium carbonate and lithium chloride.\u201d<\/em><\/p><\/blockquote>\n

Of the three, the scale of Wealth Minerals\u2019 flagship\u00a0project really stands out at 46,200 hectares, (114,160 acres<\/em>).\u00a0 If the Company is successful in identifying high-grade Li & K, with acceptable levels of deleterious\u00a0elements, there would be the real possibility of a large production profile.\u00a0 That remains to be seen,\u00a0there\u2019s\u00a0no proof (just theory<\/em>) that Wealth\u2019s optioned property contains potentially economic brines.<\/p>\n

But, the theory seems a good one for the reasons laid out in the\u00a0NI 43-101 Technical Report<\/a>.\u00a0 Could there possibly be a better location on the planet to explore for concentrated Li-bearing brines?\u00a0 To reiterate, the concessions are just 30-50 km north of Albemarle & SQM\u2019s operations (lowest cost in the world<\/em>).\u00a0 Geologically speaking, in the context of aquifers, that distance is small.\u00a0 Investors in Li juniors have likely already picked a few Argentina plays, Chile should\u00a0not be ignored.\u00a0 I believe that\u00a0Wealth Minerals [TSX-V: WML] \/ [OTCMRKTS: WMLLF]\u00a0offers a compelling investment proposition, well worth readers further attention. \u00a0{See\u00a0Corporate Presentation<\/a>}<\/p>\n

Disclosures: \u00a0The content of this article is for informational purposes only.\u00a0 Readers fully understand and agree that\u00a0nothing\u00a0contained herein,\u00a0written\u00a0by Peter Epstein of\u00a0<\/em>Epstein Research<\/a>,\u00a0<\/em>[ER]\u00a0<\/em>including but not limited to, commentary, opinions, views, assumptions, reported facts, estimates, calculations, etc. is to be considered, in any way whatsoever, implicit or explicit investment advice. Further,\u00a0nothing\u00a0contained herein is a recommendation\u00a0or solicitation to buy or sell any security.\u00a0 Mr. Epstein and\u00a0<\/em>[ER]\u00a0are not\u00a0responsible, under any circumstances whatsoever, for investment actions taken by a reader. Mr. Epstein and\u00a0<\/em>[ER]\u00a0have never been, and are not currently, a registered or licensed financial\/investment advisor, broker\/dealer, stockbroker, trader, money manager, compliance or legal officer, and they\u00a0do not\u00a0perform market making activities. Mr. Epstein and\u00a0<\/em>[ER]\u00a0are not\u00a0directly\u00a0employed by any company, group, organization, party or person. Shares of\u00a0<\/i>Wealth Minerals\u00a0are highly speculative.\u00a0 Readers understand and agree that investments in small cap stocks\u00a0can result in a 100% loss of invested funds. It is assumed and agreed upon by readers that they consult with their own licensed or registered financial advisors before making investment decisions.<\/em><\/p>\n

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At the time this article was posted, Peter Epstein owned shares and\/or stock options in\u00a0<\/em>Wealth Minerals\u00a0<\/em>and the Company was a sponsor of<\/em>\u00a0[ER]. \u00a0Readers understand and agree that they must conduct their own research, above and beyond reading this article. While the author believes he\u2019s diligent in screening out companies that are unattractive investment opportunities, he cannot guarantee that his efforts will (or have been) successful.\u00a0Mr. Epstein &\u00a0<\/em>[ER]\u00a0are not responsible for any perceived, or actual, errors, including but not limited to, commentary, opinions, views, assumptions, reported facts & financial calculations, or for the completeness of this article. Mr. Epstein &\u00a0<\/em>[ER]\u00a0are\u00a0not expected or required to subsequently follow or cover events & news, or write about any particular company or topic.\u00a0Mr. Epstein and\u00a0<\/em>[ER]\u00a0are not experts in any company, industry sector or investment topic.<\/em><\/p>\n<\/div>\n<\/div>\n

\n<\/section>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

By\u00a0Peter Epstein, CFA, MBA \u00a0 \u00a0epstein.peter4@gmail.com\u00a0\u00a0 \u00a0Epstein Research In this article I discuss a Lithium\u00a0(\u201cLi\u201d)\u00a0junior that has successfully locked down, via option agreements, several key lithium\u00a0properties \/ projects\u00a0in Chile (mgmt. still looking for more) and owns or controls 4 precious \/ base metal projects in Mexico, Peru & Canada.\u00a0 Each of the Company\u2019s assets is […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-104071","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/104071","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=104071"}],"version-history":[{"count":2,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/104071\/revisions"}],"predecessor-version":[{"id":104073,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/104071\/revisions\/104073"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=104071"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=104071"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=104071"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}