Research #5

Outcropping spodumene-rich pegmatites occur on the nearby Pontax Showing (source)

Today, 92 Resources Corp. has announced the acquisition of a second hard-rock lithium project, the Pontax Property in the prolific Eastmain Lithium District of Québec. Several outcrops of white pegmatites were identified on the property in 1975, however recent high resolution satellite photos not only identified the locations of those historically defined pegmatite outcrops but as well indicate numerous other pegmatite occurrences not previously mapped. The property has not been explored for lithium by any reported historic exploration campaigns. The company intends to start a reconnaissance field campaign consisting of mapping and sampling of known pegmatite occurrences to assess potential grade and mineralogy. The Pontax Property is located in a region of Québec that boasts several significant lithium deposits and high-grade spodumene pegmatites. The property is located in an established lithium district that has been gaining momentum in exploration and development recently, hand in hand with increased investors’ interest.

Today’s announced acquisition of the Pontax Lithium Project near Eastmain consists of 104 mineral claims covering 4 blocks, totaling approximately 5,536 hectares. The property encompasses the southwestern portions of an approximately 100 km long belt of meta-volcanics, which may be considered part of the Eastmain River Volcanic Belt. The Eastmain Belt is host to numerous gold occurrences, while the region is centrally located to a number of high profile lithium deposits (Galaxy Resources’ James Bay Deposit, Nemaska’s Whabouchi Deposit, and Critical Element’s Rose Deposit).

Source: Googlemaps

The Pontax Property lies between 5 and 30 km southwest of, and on trend, from Stria’s Pontax Lithium Showing, a spodumene-bearing pegmatite, which was discovered in 2007. Stria subsequently advanced the discovery with 7 drill holes, returning a best intercept of 0.97% Li2O over 21 m, including 1.43% Li2O over 13 m.

92 Resources’ Pontax Property is also about 30 km south of the James Bay Deposit, which is reported to contain indicated resources of 11.8 million tonnes at 1.3% Li2O, and inferred resources of 10.5 million t at 1.2% Li2O at a 0.75% Li2O cut-off (Galaxy Resources’ Technical Report, December 2010).

The northernmost part of 92 Resources’ Pontax Property covers pegmatite outcrops identified as tourmaline-bearing pegmatite during a 1999 government mapping campaign. These pegmatite outcrops are approximately 1 km away from a spodumene- and tourmaline-bearing pegmatite outcrop that was identified in the same regional mapping survey. In general, historic exploration of the property for gold, lithium, and other commodities is considered minimal. Moreover, the property has not been explored for lithium by any reported historic exploration campaigns.

In the coming weeks, 92 Resources intends to complete a review of all historic information in advance of a reconnaissance field campaign that will consist of mapping and sampling of known pegmatite occurrences to assess potential grade and mineralogy at Pontax.

The James Bay Lithium Deposit (Galaxy Resources Ltd.; $580 million AUD market capitalization) occurs at surface and resource modelling indicates that the resource is amenable to open pit extraction. According to Galaxy, there is excellent potential to increase the resources through additional delineation of the pegmatite dikes along strike and at depth and potential to increase grade through infill drilling. Lithium mineralisation at James Bay is associated with spodumene-bearing pegmatite dike swarms, which vary in width from 60-100 m. The dikes generally outcrop at surface, and form a dis-continuous corridor over a strike length of 4 km. Almost all the pegmatites at James Bay are known to be spodumene-bearing, with relatively coarse crystals (usually more than 5 cm, sometimes exceeding 1 m). The coarse grained spodumene mineralisation is likely to respond very well to conventional processing.

Indicated: 11.75 million t @ 1.3% Li2O
Inferred: 10.47 million t @ 1.2% Li2O

The Whabouchi Deposit (Nemaska Lithium Inc.; $344 million CAD market capitalization) has a feasibility study for the deposit and a hydromet plant, revised in January 2016:

Measured: 13 million t @ 1.6% Li2O
Indicated: 15 million t @ 1.54% Li2O
Inferred: 4.7 million t @ 1.51% Li2O

The Rose Lithium-Tantalum Deposit (Critical Elements Corp.; $73 million CAD market capitalization):

Indicated: 26.5 million t @ 1.3% Li2O
Inferred: 10.7 million t @ 1.14% Li2O

Rockstone is looking forward to the upcoming exploration program on 92 Resources Pontax Property which is expected to include ground prospecting, geological mapping and sampling of outcropping pegmatites, potentially with lithium grades similar to the Pontax Showing and Galaxy’s nearby James Bay Deposit.

The known lithium deposits and showings in the James Bay / Eastmain area highlight Québec as an excellent place to be. Despite being relatively remote, the projects are close to roads and power lines, a fact that makes the potential CAPEX/OPEX viable for development, as being the case with Whabouchi.

Spodumene-bearing pegmatites continue to be an important supply of lithium globally, despite the advent of low-cost production from lithium brine deposits in South America in the mid-1990’s. As the demand for lithium increases, pegmatite deposits around the world are gaining more focused attention as a viable, stable, and long-term supply source. Further, in many lithium pegmatite districts, other rare and specialty-metals have been recovered, including tin, beryllium, tantalum, and niobium which are often associated with spodumene pegmatite deposits.

The world’s largest active lithium mine is the Greenbushes Mine in Australia, with reported reserves (as of September 2012) of 61.5 million t at 2.8% Li2O. The mine produces lithium from spodumene bearing pegmatite and has been in operation since 1985.

In 2015, the global lithium market (in lithium carbonate equivalent or “LCE”) is estimated to have been approximately 171,000 t, for which the Greenbushes Mine accounted for 55,000-60,000 t, or some 35% of the market (source: Deutsche Bank, May 2016).

Joe Lowry, lithium expert and market veteran, recently noted:

“The addition of several new spodumene players (Mt Cattlin, Mt Marion, Pilbara and at least one new player in Quebec) by the end of the decade will continue to increase the hard rock share of the market over the next few years. This is probably a good time to mention a “mini myth” – let’s call it a “sub myth”: brine based lithium is the “best” source of lithium. Yes, lithium chemicals produced from world class brine are lower cost than hard rock based production; however, it is clear that the advantages of spodumene have greatly exceeded the cost disadvantages in recent years. It has been the growth of “high cost” spodumene capacity that has kept lithium supply in balance with demand over the past few years and will keep it in balance with demand over the past few years and will keep it in balance for at least the next three years.”



Company Details

92 Resources Corp.
#1400 – 1111 West Georgia Street
Vancouver, BC, Canada V6E 4M6
Phone: +1 778 945 2950

Shares Issued & Outstanding: 42,776,623

Canadian Symbol (TSX.V): NTY
Current Price: $0.15 CAD (July 25, 2016)
Market Capitalization: $6 million CAD

German Symbol / WKN (Frankfurt): R9G2 / A11575
Current Price: €0.094 EUR (July 25, 2016)
Market Capitalization: €4 million EUR



Previous Coverage

Research #4: “Why 92 Resources looks ready for the next upswing“ (June 20, 2016)

Research #3: “Extremely high-grade lithium assays from surface“ (June 7, 2016)

Research #2: “Untapping Canada‘s Hidden Lithium Treasuries“ (March 1, 2016)

Research #1: “92 Resources on the case for Hard Rock Lithium“ (April 11, 2016)

Disclaimer: Please read the full disclaimer within the full research report as a PDF (here) as fundamental risks and conflicts of interest exist. 

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Name: 92 Resources Corp.
Canada Symbol: NTY
Germany Symbol / WKN: R9G2 / A11575
Shares Issued & Outstanding: 42,776,623
Phone: +1 778 945 2950

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