Minerals exploration and development company GreenTech Metals has suddenly found itself next to a new power-play among lithium giants right next door to its own developing West Pilbara lithium project in Western Australia.
Significant corporate activity is targeting the region, including global lithium giant SQM’s joint venture (JV) with Novo Resources and separately, SQM and Hancock Prospecting’s $1.7 billion bid for Azure Minerals.
SQM, short for Sociedad Quimica y Mera de Chile, is a Chilean resources giant and the world’s second-biggest lithium miner. The company has steadily been increasing its footprint on some of WA’s best lithium ground.
While the action has been going on around it, GreenTech has maintained a strong focus on its Pilbara lithium projects, encouraged by a string of decent lithium oxide hits in detailed rock chip sampling of the long runs of pegmatite outcrop within its two exploration licences.
And it is not a stretch to suggest that the company’s efforts, which triggered a significant share price stir in 2023, have also attracted the attention of the bigger players.
GreenTech holds a 100 per cent interest in its Ruth Well licence, complemented by a 51 per cent interest in its eastern contiguous Osborne JV it shares with Artemis Resources, which holds the remaining 49 per cent interest.
The company’s interests comprise almost one third of the east/north-easterly strike of the major Karratha lithium corridor, shown by several discoveries to extend for more than 60km as far as about 20km east of Roebourne, with potentially further extension beyond that.
Working eastwards from Ruth Well and Osborne in the west, the line of exploration licences held by other parties includes Artemis, then the contiguous SQM/Novo JV on Artemis’ eastern boundary. The next project to the east is Azure’s contiguous Andover nickel copper – and now lithium – project, with attendant suitors SQM and Hancock.
Further east, the SQM/Novo and Andover lithium properties are bounded on their southern flanks by the contiguous Raiden Resources and Errawarra Resources ground.
And finally, both Azure and Errawarra have another contiguous SQM/Novo block of ground on their eastern boundaries.
For now, SQM is showing up as the biggest player in the field, with its multiple interests along the lithium corridor.
In mid-December, Azure revealed it entered a new binding transaction implementation deed with SQM and Hancock as joint bidders. It was proposed that the bidders would acquire 100 per cent of the shares in Azure through a scheme of arrangement for $3.70 per share.
The Azure board has recommended the transaction in the absence of a superior proposal and two of the company’s major shareholders, Creasy Group and Delphi Group, say they intend to support the transaction. An Azure shareholder meeting to approve the deal is expected to be held in mid-March.
Along with the yet-to-be-finalised Andover dealings, SQM formed its JV with Novo in late December. The JV relates to five of Novo’s prospective lithium and nickel exploration tenements in the West Pilbara and one of the subject licences lies immediately west of the Andover ground.
The JV has taken the name Harding Battery Metals to reflect the importance of the Harding River in the region. SQM will pay Novo $10 million for a 75 per cent interest in the tenements and holds a 12-month option over the company’s additional exploration ground in the West Pilbara.
Novo will retain a 25 per cent interest, along with 100 per cent ownership of the gold, silver, platinum group elements, copper, lead and zinc mineral rights. Novo’s 25 per cent interest will be carried by SQM until a decision to mine is made by the Harding Battery Metals JV participants and the Aussie miner would also be entitled to a contingent success payment based on contained lithium in a JORC-compliant ore reserve upon completion of a feasibility study.
All the above events taking place immediately east of GreenTech’s ground bring the company into sharper focus.
GreenTech reported in mid-June last year that it had identified a persistent east-west striking line of lithium pegmatites that would become its “Kobe” trend in the extreme north of its Ruth Well exploration licence. The company’s first Kobe rock chip sampling jagged three key results running 1.65, 1.63 and 1.03 per cent lithium oxide from pegmatites within about 1km of the western boundary of its Ruth Well ground, noting the trend was up to 2km wide and could extend for 6km.
The following month, the company reported on further reconnaissance showing the Kobe trend extended eastwards into its Osborne JV ground. More comprehensive infill rock chip sampling by GreenTech along the entire known Kobe trend confirms its strike persistence for more than 6km across the full width of the northern part of Ruth Well.
The Kobe trend in the Ruth Well ground carries significant lithium grades up to a top five results of 2.31, 1.72, 1.65, 1.63 and 1.54 per cent lithium oxide. Additionally, results from rock-chip sampling of the Kobe trend extension into Osborne threw up top five results of 1.82, 1.80, 1.71, 1.58, and 1.49 per cent lithium oxide.
Artemis also undertook a review of historic geochemical soil sampling data within its own 100 per cent-owned ground and now believes elevated lithium and associated pathfinder anomalism extends eastwards in the same pegmatite corridor towards its own eastern border with SQM/Novo ground.
Osborne also contains what GreenTech calls the Southern trend, a shorter 3.2km-long, east-west striking pegmatite trend in the south-western corner of the tenement. Its geological mapping shows a northern arm of the Southern trend may extend further east about another 1.3km.
Interestingly, rock chip sampling across two bifurcating lines of pegmatite in the Southern trend to date has yielded a surprising outcome, with the top five results coming at 3.63, 2.41, 2.38, 2.30 and 1.54 per cent lithium oxide. The results will be followed up, but in the meantime, GreenTech has also undertaken 1611m of scout diamond drilling for 299 core samples from four holes to gather structural and stratigraphic information on both the Kobe and Southern pegmatite trends.
Two diamond holes were put into each of the trends, achieving their geological objectives, and analytical results are awaited. They are thought to be the first holes drilled in the two trends within the company’s tenure.
The first drill hole, put into the Southern trend at a 40-degree declination, was ended at 810.2m depth having intersected multiple zones of north-dipping stacked pegmatites, including a 24.6m intercept of mica-quartz-feldspar pegmatite from a downhole depth of 674m.
Management says the pegmatite could be the down-dip extension of the surface outcrop of the Osborne pegmatite that had previously returned respectable rock chip assay results of up to 3.63 per cent lithium oxide.
GreenTech’s, exploration to date shows the Kobe trend to be a remarkably persistent and uniform lithium-caesium-tantalum (LCT) pegmatite occurrence, exhibiting little mineralogical change over its entire known strike distance of more than 10km, not all of which is in the company’s ground.
Management says the pegmatites discovered within the corridor all appear to be similar, if not identical in terms of mineralogy, although local geology and structural controls may differ in places. It believes the common source and regional controls on the pegmatite occurrences may be related to a single, large granite batholith underlying the corridor.
The regional extent of the corridor and likely common single source granite to all local projects indicate that the apparent lack of LCT-type pegmatites at surface in some places, such as between the Andover/Azure ground and GreenTech’s pegmatite discoveries, is more likely attributable to lack of relevant exploration in these areas than any actual absence of pegmatites.
It is therefore reasonable to expect that further work will soon clarify the question of possible east-west continuity of the fertile pegmatites across the entire string of projects in the area. If that is the case, Greentech is sitting on about one third of the potential overall trend along the line of ground.
And at Ruth Well, the company isn’t just sitting on the long lithium pegmatite trends, but also has a base metal play containing an estimated 265,000 tonnes going 0.5 per cent nickel and 0.4 per cent copper. It is worth noting that Azure’s Andover project began as base metals play within the corridor and has also morphed into a lithium play.
So, perhaps it’s not too hard to envisage that Kobe and possibly other pegmatites in GreenTech’s ground could continue further east towards and even into the SQM/Nova JV … and perhaps beyond. That is likely to have the big money companies occasionally peeking westwards over the fence to see what GreenTech and Artemis are up to, while keeping a beady eye on the lithium demand speedometer and trying to gauge when the right time might be to make another play.
Other players in the region, such as Raiden, have already picked up multiple pegmatites that are possibly new ones or eastwards extensions from Errawarra’s pegmatites immediately south of Azure’s Andover ground.
Mid-November market capitalisations of players in the immediate area of greatest activity place Azure at the top with $1.83 billion, Raiden at $112 million, Artemis at $50 million, GreenTech at $44 million and Errawarra at $13 million.
GreenTech also holds a significant copper resource at its Whundo project 40km south/south-west of Karratha in WA’s West Pilbara region. The project covers about 9 square kilometres in the West Pilbara mineral field and comprises 6.2 million tonnes at 1.2 per cent copper and 1.04 per cent zinc. It is being quietly progressed as the company focusses on its lithium potential.
Management reported a strong cash balance as at the end of December and says it enjoys strong shareholder support, having received more $300,000 from the exercise of options.
A significant decider on the direction of immediate future work on the Pilbara lithium project could be the analyses from the company’s four diamond drill holes. A handful of good thick lithium intercepts with good grades between the 200m and 800m range of the hole depths will no doubt raise a few eyebrows – and a quick look at the drill logs and some core photos indicate that is on the cards.
After an eye-catching 2023, it will be interesting to see what unfolds for GreenTech in 2024.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
