Rare Earth said its interest in Bacanora's Sonora lithium project is progressing

7th Jul 2016 11:20

(ShareCast News) - Rare Earth Minerals reported that Bacanora Minerals' Sonora lithium project had made progress at "apace" ahead of its definitive feasibility study in early 2017.The company said they have an interest in the project as Rare Earth has a 15.5% holding in Bacanora.Bacanora said the feasibility study focused on delivering the most economically robust development strategy for the initial 17,500 tonne per annum of lithium carbonate produced at the project in Sonara, Mexico, which will consequently increase to 35,000 tonnes per annum later.Bacanora said its strategy is to position itself to satisfy ongoing strong growth for lithium carbonate in the fast growing sectors of electric vehicles and energy storage.Rare Earth said that the 3,000 metre infill drilling programme is progressing "well" and over 2,000 meters have been drilled so far. It said they hope to upgrade the mineral resource to 'indicated' to 'measured'.The company said the expansion of the pilot plant capacity focused on the delivery of battery-grade lithium carbonate samples to off-takers in Asia and Europe during the third quarter this year.Rare Earth said Baconara had developed strategic relationships with international lithium trading companies and mining companies for the sale of its lithium carbonate products. This included a number of detailed site and plant visits completed with potential off-take partners. Off-take agreement negotiations were undertaken at the same time as the company prepared for the definitive feasibility study.Baconara is an AIM listed Anglo-Canadian mineral explorer. Its Sonara lithium project has 10 mining concession covering about 100,000 hectares. Rare Earth's interest in the project is significant as it also held shares in some of the concessions.The El Sauz, El Sauz 1, El Sauz 2, Fleur and Fleur 1 concessions are held by Mexilit. Rare Earth had a 30% direct interest in Mexalit through its joint venture with Bacanora, and when combined with Rare Earth's 15.5% direct interest in Bacanora, it had a 40.8% total economic interest in Mexilit.The Buenavista and San Gabriel concessions are held by Megalit. Rare Earth also had a 30% direct interest in Megalit through its joint venture with Bacanora, and again when combined with Rare Earth's 15.5% direct interest in Bacanora it had a 40.8%.total economic interest in Megalit.REM chief executive Kiran Morzaria said: "Progress continues apace at the project. All the work streams are maintaining strong momentum and are on schedule. Discussions with potential off-take partners have made significant progress as has the project's ability to supply battery-grade samples."Shares in Rare Earth Minerals fell 1.17% to 0.44p at 1215 BST and shares in Bacanora Minerals rose 2.58% to 1.59p at 1216 BST.