Galan makes ‘great progress’ at Hombre Muerto West lithium brine project, construction of pilot pond underway
Galan Lithium (ASX: GLN) has made “great progress” in its Hombre Muerto West (HMW) lithium brine project in Argentina, with the construction of a pilot pond underway and new drilling rigs purchased for speed up exploration.
The company has started building the pilot basins, which will be filled with HMW brine to test the evaporation process and target a 6% lithium concentrate.
These basins should be operational during the next quarter.
Meanwhile, development of a new temporary camp at HMW is underway and should be usable early next month.
Once completed, Galan will have two fully functional camps to support ongoing activities at HMW and the neighboring Candelas project where the other camp is located.
These camps will be in use until a larger permanent camp is built next year.
Galan Managing Director Juan Pablo Vargas de la Vega said he was “very excited” by the “great strides” the company made at HMW.
“Our efforts and vision are only focused on getting the project online and becoming a lithium producer as soon as technically possible.”
“2021 has been a year of strength, transformation and consolidation for Galan and we look forward to 2022 and delivering additional value to our shareholders by being part of this watershed period as the world shifts to a cleaner global economy driven by new electric vehicles powered by lithium batteries, ”added Mr. Vargas de la Vega.
To speed up exploration at HMW, Galan has also purchased a new rig and a second is expected to arrive at the site in January.
Depending on the progress of the drilling, Galan has the option of using a third platform to speed up the program.
The drilling program is expected to be completed in the first half of next year, and a resource update will follow shortly thereafter.
In addition to drilling, the company hired Quantec Geosciences to perform a transient electromagnetic (TEM) geophysical survey on all HMW buildings.
In addition to building the resource, the TEM drilling and survey will provide key data to advance the feasibility study on HMW, which is expected to officially start soon.
A boosted economy
Today’s announcement follows an updated economic study for HMW and Galan’s other project, Candelas.
The updated study was based on a revised long-term lithium price assumption of US $ 18,594 per tonne between 2025 and 2040, up from the previous figure of US $ 11,687 / t.
With a higher borrowing lithium price, HMW’s pre-tax net present value increased 120% from US $ 1 billion to nearly US $ 2.2 billion (AU $ 3.06 billion).
Including Candelas, the NPV of the two projects now totals US $ 3.4 billion (AU $ 4.74 billion).