A deposit in Nevada has the potential to make the U.S. self sufficient in lithium at a rate supporting building up to one million electric vehicles per year at current use per vehicle.

That’s the estimate of Jay Chmelauskas, President of Western Lithium who said in a company press release, “As an electric car owner, the move to automobile electrification now seems obvious and imminent. Production of lithium in Nevada not only has the benefit of long-term mining and chemical industry jobs, but also has the potential to support downstream technology and manufacturing jobs in America.  Lithium is the enabling metal for electric transportation.”

Western Lithium USA Corporation, which is publicly traded, announced the completion of a positive pre-feasibility study for its wholly owned Kings Valley Lithium Project in Nevada, USA.

Two scenarios have been evaluated from work products by a collaboration of independent industry specialist firms including Tetra Tech, Inc., Reserva International, LLC and K-UTEC AG Salt Technologies.

The first is a startup scenario based on mining and processing ore at a design throughput rate of 2,100 (tons here are metric or 2200 lbs) tons per day (13,000 tons per annum lithium carbonate), and second, a full production scenario to double production four years after startup (26,000 tons per annum lithium carbonate).

The study demonstrates that the project could produce lithium carbonate at an estimated average cash cost, net of by-product credits, of $968 per ton once full production of 26,000 tons per year lithium carbonate is achieved. Initial startup capital, including contingency is expected to be approximately $248 million. Incremental development capital to double lithium carbonate production to 26,000 tons per year is estimated at approximately $161 million. Sustaining capital of $40 million including contingency, is primarily composed of surface mine equipment, expansions of dry stack tailings and surface water management, and the mine’s closure.

The startup scenario for lithium carbonate production is expected to commence in 2015 at an annual rate of 13,000 tons per year. Full production of 26,000 tons per year is planned four years after initial startup, if demand for lithium increases.

Optimistic, Chmelauskas takes us further by saying, “Upcoming key milestones for the company include; submission of the Plan of Operations to the Bureau of Land Management initiating the formal permitting process (Q1 2012), starting construction of a lithium carbonate demonstration plant, and commencing work on a definitive feasibility study in 2012. We believe that there is a strong future for electrification and that the Stakeholders of Western Lithium and Nevada can strongly benefit and profit from this industry.”  We all hope the Bureau of Land Management is the only bureaucracy they have to deal with.

The Kings Valley Lithium Project is located in Humboldt County, Nevada, approximately 62 miles north-northwest of Winnemucca along U.S. Highway 95 to Orovada and then 25 miles west-northwest of Orovada, Nevada on paved State Highway 293. Western Lithium has claims that encompass five areas of lithium mineralization.  These five areas are covered by 1,049 Federal unpatented claims over an area of 8,480 hectares.

Mineral Reserves

Kings Valley Ore Reserves
at 0.320% Lithium Cut-off





















Note: 95% Mine Recovery Factor Applied. Please see the Company’s additional disclosure of risks and uncertainties surrounding potassium and sodium in its continuous disclosure filings at the company’s website www.westernlithium.com.

The reserve estimate takes into consideration all geologic, mining, processing, and economic factors.

Sharp observers will note the potassium available as well.

Highlights include:

•    Nominal production of by-product potassium sulfate and sodium sulfate of 90,000 and 100,000 tons per year, respectively;
•    20 year mine life, processing 25.5 million tons of ore at an average grade of 0.40% lithium using a 0.320% cut-off grade;

•    The project benefits from established infrastructure including road access, power supply and a local water source;
•    Based on commodity prices of $6,000 per ton lithium carbonate, $600 per ton potassium sulfate, and $75 per ton sodium sulfate;
•    Overall recoveries are expected to be 87.2% for lithium, 77.7% for potassium and 82.7% for sodium.

To measure against those highlights these numbers might be kept in mind:

•    Cash operating costs distributed between the individual products are: lithium carbonate $3,011 per ton, potassium sulfate $87 per ton, sodium sulfate $36 per ton.

Obviously the company expects to do very well.  Even with some lithium price pull down the numbers look pretty good.  That’s a good thing for the economy in North America.

Western Lithium is a Canadian company, which comes at no surprise considering the U.S. economy and the U.S. government’s attitude toward business through regulations and capital controls with the new financial regulation law.  Americans should count their blessings that the lithium was found here and there is a friendly neighbor with their economic act together well enough to get development underway.


1 Comment so far

  1. Matt Musson on January 11, 2012 7:44 AM

    25 Million tons in the ground. It seems like they can pull 26 thousand tons a year out.

    If we don’t get our own supply set up – the Chinese can shut us out of high tech manufacturing any time they want to turn off the spiget. (Just like when they quit selling rare earths.) Or, the Peruvians can hold us up on price.

    A big ore processing plant was just set up here in Kings Mtn NC. There is plenty of lithium in the ground nearby. But, it has been regulated out of any possiblity of commercial extraction.

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