Shares in Bradda Head Lithium (AIM:BHL), the AIM-listed lithium explorer with operations in Nevada and Arizona are notching higher after the company said it has received conditional permission to start drilling at its Eureka project. Lithium is the metal of the moment with demand in the US and worldwide is getting stronger by the day thanks to the electric car industry which uses it for.
Bradda Head’s project is conveniently located in central Nevada, not far from Tesla’s (NASDAQ: TSLA) gigafactory and Albemarle’s (NYSE: ALB) existing Silver Peak lithium mine, currently the only lithium mine operational in the US.
Demand for lithium expected to rise dramatically
Over the coming decade demand for lithium is expected to rise dramatically as the electric car industry gears up to meet regulatory demands for zero emissions in Europe, US and China. Little wonder than that lithium producers and explorers are current market favourites. A flurry of activity since the start of the year including today’s news have helped Bradda Head’s share price rise by almost 170% over the last 12 months, up from 5.75 pence in March last year to 15.50 pence today.When Bradda Head geologists previously took surface samples at Eureka they found 550ppm of lithium. The current drill programme will look deeper and will cover 23 holes over an area of 1,050 metres.
“This programme is designed to test the potential for a shallow clay project at surface, similar to Bradda’s other clay assets in Arizona (Wikieup and Basin),” the company said.
Geophysics surveys
Zonge Engineering and Terravision Exploration carried out previous geophysics surveys which demonstrated the potential presence of both brine and clay deposits at Eureka. They also showed that Eureka has geothermal potential, which could be used as a power source and lower the carbon footprint of lithium production at the site.
According to Bradda Head drilling can begin once a bond payment is adjudicated, which is expected to be in the next 30 days. As of last week, Bradda Head has posted the necessary bonding payment totalling $7,870 required by the BLM. Exploration permits should be issued within 30 days of bonding fees being received.
Zonge Engineering and Terravision Exploration previously carried out MT and GPRplus surveys, respectively, at Eureka. The MT survey showed the presence of a potential brine reservoir at depths ranging between 300m and 2,000m over a 12km strike length while the GPRplus survey showed the presence of potential clay material, like that seen at Bradda Head’s other sedimentary assets at the Basin and Wikieup projects.
The company went through a spurt of changes in January, including the re-naming that made it clearer to unfamiliar investors that the firm’s focus is on lithium, listing on the OTCQB market in America and gaining new investors with notifiable interests. At the time Bradda Head also announced that it had bought the Burro Creek assets in Arizona, positive metallurgical results from its Basin project and the results of the geophysics programme in the Eureka project.
All of Bradda Head’s assets are located within reach of potential end-users, which apart from the already mentioned Tesla Gigafactory include America Best Battery Company, Rose Batteries and Swit Electronic near San Francisco and Makita USA, US Battery Manufacturing and Trojan Battery Company in Los Angeles.
