Mar 13 2014
BACANORA MINERALS LTD. is pleased to provide an update of recently completed corporate activities, ongoing exploration work and future plans for the Sonora Lithium Project in Mexico.
Highlights:
- Joint Venture #2
- Bacanora and Rare Earth Minerals PLC ("REM") have signed a definitive joint venture agreement in respect of the San Gabriel, Buenavista and Megalit concessions ("Joint Venture #2");
- A 1,500 metre diamond drill program is planned for the Penasco lithium clay prospect on the Megalit concession, with mapping and prospecting to commence soon; and
- Trenching of lithium clay surface showings on the Buenavista concession will be undertaken as a part of the program.
- Joint Venture #1
- Stage 2 drill program recently completed on the El Sauz - Fleur concessions ("Joint Venture #1") (for further information, please refer to Bacanora's news release dated March 4, 2014);
- A 1,500 metre Stage 3 drill program will be initiated on the Joint Venture #1 lands with the objective of upgrading the lithium resourcefrom the inferred resource category to the indicated resource category (though there can be no assurance at this stage that such an upgrade will be declared) and for the purpose of providing data for a Preliminary Economic Assessment ("PEA") on the Joint Venture #1 lands; and
- 1 tonne bulk samples from surface exposures of the upper and lower clay units exposed on both the La Ventana and Joint Venture 1 lands have been collected for metallurgical and mineral processing test work.
The Sonora Lithium Project now consists of 10 contiguous concessions, two of which (La Ventana and La Ventana 1) are owned 100% by Bacanora. Another five concessions (El Sauz, El Sauz 1, El Sauz 2, Fleur and Fleur 1) form the lands under Bacanora's Joint Venture #1 with REM, pursuant to which REM has a 30% interest (with Bacanora holding the remaining 70%). Lastly, three concessions (San Gabriel, Buenavista and Megalit) form the lands under Bacanora's Joint Venture #2 with REM (in respect of which REM has an option to earn up to a 49.9% interest - see the discussion below under the heading "REM Formal Agreement").
REM Formal Agreement
Bacanora is pleased to announce that is has signed a definitive agreement with REM, which shall supercede the previously announced Memorandum of Understanding between Bacanora and REM (see Bacanora's press release dated December 5, 2013 for further details thereof). Highlights of the formal agreement are:
- REM has the option to acquire an initial 10% interest in the San Gabrial, Buenavista and Megalit concessions by virtue of REM paying Bacanora an upfront cash consideration of U.S.$250,000 and spending U.S.$500,000 on exploration and drilling on the Joint Venture #2 concessions over a 6 month period.
- REM has the option to increase its interest to 30% by virtue of an additional cash consideration of U.S.$500,000 and committing to a further U.S.$1,000,000 in expenditures for exploration and drilling on the same concessions over 1 year.
- REM will have the right to advance these payments and acquire the 30% on an accelerated basis.
- REM will then have an exclusive option (exercisable until December 2015) to negotiate terms to increase from a 30% interest to a maximum of 49.9%.
San Gabriel, Buena Vista and Megalit Concessions (Joint Venture #2) Update
The Company plans to test a new lithium bearing clay prospect, Penasco, located on the Megalit concession, to the south of El Sauz, with a five hole-diamond drill program. In addition, a clay occurrence to the east of the Penasco prospect will be drill tested. The initial drill program is expected to start as soon as a rig can be mobilized to site and will be in the order of 1,500 metres in 7 holes.
In conjunction with the drilling, mapping and prospecting will continue on the large (94,815 hectare) Megalit concession in order to locate and sample additional exposures of the lithium-bearing clay basin. In addition, trenching of surface exposures on lithium-bearing clays striking northerly along 6 kilometres on the Buenavista concession will be undertaken. Previous sampling by the Company returned lithium values ranging from 121 to 1,350 ppm Li (0.72% LCE) from surface clay samples collected on Buena Vista (see the Company's press release dated December 5, 2013 for further details).
El Sauz and Fleur Concessions (Joint Venture #1) Update
Stage 2 diamond drilling, consisting of 2,384.76 metres in 19 holes, was completed in January 2014 (refer to attached Figure 1), with analytical results having been recently received. To date, a total of 3,804.22 metres have been drilled in 29 holes by the Company on Joint Venture #1 lands. Results from the last holes of the Stage 2 drilling varied from 150 ppm Li to 2,011 ppm Li (1.07% LCE(1)) across 36.58 metres in the upper clay unit and from 41 to 5,351 ppm Li (2.85% LCE) across 25 metres in the lower clay unit (for further details, please refer to the Company's news release dated March 4, 2014).
A stage 3 drilling program, consisting of approximately 1,500 metres in 10 holes, is expected to commence in the next few weeks. The objectives of this program will be to provide further definition of the extent of the clay units on El Sauz and to provide sufficient data to upgrade the Li resources from the inferred resource category to the indicated resource category (though there can be no assurance at this stage that such an upgrade will be declared), as well as to provide data for a PEA of the Li resources on the Joint Venture #1 lands.
Metallurgical and Mineral Processing Test Work
Metallurgical and mineral processing tests are ongoing on samples from La Ventana and Joint Venture #1 lands. The pilot plant at Bacanora's test facility in Hermosillo is operating and processing material. Bulk samples, each of approximately one tonne in size, from the upper and lower clay units of both La Ventana and El Sauz/Fleur are being readied for process tests in order to produce lithium carbonate from the clays. The results of this work will provide data for a pre-feasibility study of the La Ventana lithium deposit as well as data for a PEA on the southern extension of the La Ventana deposit and on the El Sauz and Fleur concessions.
Martin Vidal, President of Bacanora, commented, "We are very pleased with the rapid progress that has been made in developing lithium resources and the testing metallurgy and process options for production of lithium carbonate from the Sonora Lithium Project. New lithium-bearing clay units discovered on Joint Venture #2 lands provide further evidence regarding the Sonora Lithium Project's potential to develop into a world class lithium property. We look forward to further results as Stage 3 drilling commences on the Joint Venture #1 and #2 lands, and we optimistically await further metallurgical and mineral process results regarding lithium recovery and lithium carbonate production from the clay units."