PFE snaps up another 3,728 prime lithium acres

ASX:PFE

Published 17-JUL-2024 10:31 A.M.

3 min read

Shares Held: 9,803,012

Options Held: 2,994,167

Announcement

Trust Centre

Land position growing…

Data imminent…

And a re-entry well program is fast approaching.

Today, our USA lithium Investment, Pantera Minerals (ASX: PFE) successfully secured an additional 3,728 acres of leased land in the Smackover, south west Arkansas.

PFE is also due to receive subsurface data as well, which will be the final step before deciding on a re-entry well location, with the ultimate aim of pulling a lithium bearing sample to surface.

PFE now has a total landholding of 25,998 net acres which makes it the largest landholder outside of the major players in the region.

And the major players have certainly flocked to the region, in our last note on PFE we covered how South Korean EV battery maker SK On had just entered the Smackover via a deal with energy supermajor, the $772BN capped Exxon Mobil:

Pantera to re-enter wells for lithium brine as oil major neighbour Exxon starts pre-sales of lithium

Before SK On, it was the Norwegians entering the Smackover via a JV agreement between TSX-listed Standard Lithium and the $111BN capped Equinor, which made its riches off of North Sea oil.

The region is now teeming with major investors and the saloon door keeps swinging: Norwegians, South Koreans, Americans, and of course Aussies (that’s PFE).

It’s like the start of a “man walks into a bar” joke.

Except it’s no joke at all - this is the real deal for the USA as it gets serious about securing its lithium supply for decades to come.

After visiting the Smackover region of Arkansas last year, we have a strongly held view that southwest Arkansas will be a major USA lithium production hub in a couple short years.

And the significant investments by major players in the region continues apace and runs counter to the prevailing macro narrative that lithium prices will remain depressed for a sustained period.

Which makes PFE’s achievements to date that much more significant from a counter cyclical perspective.

PFE intends to re-enter a well shortly after it receives a “sub-surface 3D static model” from major energy services provider SLB.

If PFE can retrieve a high lithium concentration brine sample from a well re-entry well it will confirm what many in the Smackover have already discovered in the region - that there are significant concentrations of the EV battery metal in the area.

And (we hope) high concentration lithium brines will also be found on PFE’s now even more substantial ground position.

How does today’s news impact our PFE Investment Memo?

Objective #1: Rapidly increase acreage in Smackover Formation
PFE, is aiming to rapidly grow its footprint in the Smackover Formation. This could make the company attractive to majors in the area or another company looking to gain exposure to the region. To do this PFE will need to continue leasing acreage quickly.

Milestones

✅ 10,000 acres leased

✅ 15,000 acres leased

✅ +25,000 acres leased

Source: 4 March 2024 PFE Investment Memo

Today we tick off our last milestone from Objective #1 for PFE from our PFE Investment Memo. And we now turn our attention to Objective #2.

Objective #2: Convert exploration target into a maiden JORC resource
PFE has already defined a 436,000 to 2,966,000 tonnes of Lithium Carbonate Equivalent (LCE) exploration target. We want to see PFE convert that into a maiden JORC resource estimate.

Milestones

✅Release an exploration target

🔄Acquire existing 2D seismic/geophysical data

🔄Re-enter old oil and gas wells

🔲Sample the wells for lithium brines

🔲Maiden JORC resource estimate

Source: 4 March 2024 PFE Investment Memo

With today’s news we now know that the 3D subsurface model data will be received by PFE “imminently” which will help PFE finalise a re-entry well location.

What’s next for PFE?