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The Other Guys - American Lithium

Outside of our index there are several other Lithium companies. The Other Guys is a series to bring them to light.



First, there are just so many names I guess, but when I first got started, I got Lithium Americas (LAC) and American Lithium(LIACF) confused. Its kind of like the Monty Python movie the Life of Brian where they were listing the secret resistance groups.


American Lithium though is a company that has two Lithium projects and a Uranium project in various stages of development. Of the two lithium projects the Tonopah project in Nevada is the closest to completion. This is a clay sands situation. Personally, I am a sucker for a great diagram and they include it in the company site.


This is a great example of how we see Lithium deposits forming. The plate tectonics that has pushed the islands into the North American continent causes hot springs from subduction. These hot springs are bringing up Lithium from the crust. Volcanic Ash and new weather patterns begin over the region. The lake dries up over time and now the deposit stays there. This is the 'story' of Tonopah.


For those wondering, I love geology and almost regret not making that my college pursuit so many years ago.


Now to the challenge. Extracting the Lithium from clay is a tech that is still being developed. So keep that in mind.


They also have another asset that I am going to say is unusual in the grand scheme of things. A spodumene site in the Lithium Triangle. Falchani is hard rock opportunity. The information was from 2019, which is key. This was as the bottom fell out for a while in the Lithium business. The OpEx for the product meant that every ton of spodumene was a loss.


2021, this is not true. Either way this is a great example of the commodity price being a decision maker. Yes, everyone realized we needed more Lithium; but no, we aren't going to mine things at a loss.


I'm including the base case of their project report from their website.



Notice that OPEX in the lower left. I said in an earlier article that hard rock mining tended to be at a higher OPEX, this demonstrates that.


This resource though is 33 years. That's strong but over a half billion to get going. Notice finally that they are producing Lithium Carbonate, which is unusual for a spodumene resource.


Typically, if you have read much of my articles, you quickly realize I favor domestic supplies. That's simply because I can't predict other countries futures. This is in Peru, which I am not as well versed.


Overall, I have liked this company, but their key asset in my eyes is Tonopah. Don't be surprised to see this stock rise in prominence in the near future.



Late note. I was looking at the amount of money and doing my stop light drawing and BOOM, an article. This happens. I will do more research into the Crescent Dunes Project to understand it. This was also a bankrupt solar project, and I don't know if they get those assets or just the Lithium underneath. Stay tuned.


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