PUR ships lithium samples to multiple potential offtake partners

Our Argentine lithium brine Investment Pursuit Minerals (ASX: PUR) has now produced and shipped lithium samples to potential strategic partners for its project.

Back in early April, PUR produced 98.9% lithium carbonate equivalent (LCE) from its pilot processing plant.

Yesterday, PUR managed to process those samples into a higher, battery grade product with 99.5% purity.

AND has now shipped it to “multiple potential offtake and strategic partners for qualification”:

The main takeaway for us from yesterday’s announcement was the fact that PUR has now officially kicked off the production qualification process for its product.

With the current lithium market pretty rough, a big catalyst we see for PUR is some sort of external validation as to what the company has.

That could be some sort of strategic partnership at the project level, a cornerstone investment OR an offtake deal.

Product qualification and showing any interested parties how PUR’s project could be converted into battery grade product is likely to be a big milestone for any of those type deals.

We have also seen M&A activity start to increase in Argentina’s lithium industry which can only be good for PUR…

Rio Tinto recently paid $6.7BN acquisition of Arcadium Lithium, Galan Lithium rejected a ~$150M offer for its projects and Lake Resources has started talking about running a strategic review of its project.

Our view is that PUR puts itself in a much stronger position from a deal perspective once product qualification is ticked off.

(Source)

What else is PUR up to?

Yesterday’s announcement also mentioned that PUR was progressing with a feasibility study on a 5,000tpa project.

PUR has previously talked about its plan to scale up from its current 250tpa pilot plant in three stages.

We like that PUR is going for small first, giving it optionality to respond to demand if the lithium price bounces from its current depressed levels.

Going big now wouldn't make much sense. At a very high level, PUR’s plan is to develop its project in three stages.

Right now PUR is working toward its stage 1 target of 250tpa - which the company said would cost ~US$9.751M.

Those costs would include:

• The costs to relocate the pilot plant
• Building out the evaporation ponds
• Building out all other associated project infrastructure.

What’s next for PUR?

🔄 Relocate pilot plant to site

So far PUR has been processing synthetic lithium brines at its pilot plant.

Relocating its plant to site will be the first step to be able to produce samples from its own resource.

🔲 Offtake/partnership deal?

After today’s news our eyes are now on a potential offtake or partnership deal.

PUR recently mentioned that the company had “multiple requests for product samples from potential off-take partners”.

In the short term a deal either from a partnership OR from an offtake perspective could be a catalyst for PUR’s share price.

🔄 Environmental Permitting

A key hurdle to scaling up production for PUR is environmental permitting.

PUR requires environmental permits to construct its evaporation ponds on site.