Rover Metals Corp. (ROVR:TSX.V; ROVMF:OTCQB; 4X0:FRA), which just signed a letter of intent to option a 100% ownership interest in a claystone lithium project in Nevada, is watching a feasibility study involving a nearby lithium project with great interest.
The study by Cypress Development Corp. (CYP:TSX.V; CYDVF:OTCQB; C1Z1:FSE) is looking at the commercial viability of producing lithium carbonate for electric vehicle (EV) batteries from Nevada claystone like at Rover’s new property, which the company is calling Let’s Go Lithium.
Albemarle Corp.'s (ALB:NYSE) Silver Peak mine in Nevada is the only lithium-producing mine in North America, but it uses a water-intensive process to get at lithium-bearing brine deposits in an area that’s seeing record droughts. The claystone method uses acids to process lithium-bearing clay.
And Cypress is already seeing some success with the method at its Clayton Valley lithium project.
“We cannot understate the importance of having already produced battery grade lithium carbonate at a 99.94% purity level from Cypress' concentrated lithium solution by using a process that will be incorporated into the processing system design so that it may be produced on site,” wrote Noble Capital Markets Senior Research Analyst Mark Reichman in an October 28, 2022 note.
Work on the feasibility study began in March under the direction of John Wood Group Plc. Cypress has chosen thyssenkrupp nucera USA Inc. to design Clayton Valley’s chlor-alkali plant to produce hydrochloric acid and sodium hydroxide, reagents required for processing the claystone into lithium carbonate.
Mining brine deposits is “not what the industry wants,” Rover Chief Executive Officer and Director Judson Culter told Streetwise Reports.
“It’s not sustainable,” Culter said. “Everybody’s looking at different alternatives that are much less water-intensive.”
The Catalyst
Lithium and other critical elements like copper are needed in massive quantities to help fuel the world’s move to green energy. The soft, silvery metal with highly reactive and flammable properties is a major component of EV batteries. It’s also used to strengthen alloys, for high-temperature lubricant, and as a drug to treat bipolar disorder.
One out of five vehicles sold worldwide could be an EV in less than two years, and Ford and General Motors have set a goal of achieving 40–50% of their sales from EVs in the U.S. by 2030.
The goal is to lessen any reliance on China for the element. China only has less than a quarter of the world’s lithium resources but controlled about two-thirds of the world’s lithium processing and refining capacity in 2021, Rystad Energy said.
The climate and energy package recently passed in the United States is bringing new urgency to EV metals and minerals.
To qualify for tax credits, a significant percentage of batteries and minerals in batteries must come from the U.S. or Canada, a regional trade-treaty country.
“Lithium aligns with our energy strategy and our goal of working toward a greener future by supplying the U.S. automotive industry,” Culter said.
The goal is to lessen any reliance on China for the element. China only has less than a quarter of the world’s lithium resources but controlled about two-thirds of the world’s lithium processing and refining capacity in 2021, Rystad Energy said.
“The western world does not like to be beholden to the Chinese,” said rare earths expert Michael Thomsen, executive chairman and founding director of North American Strategic Minerals Inc. “The European and the U.S. governments . . . are scrambling for other sources . . . It’s not surprising that . . . groups are switching from precious metals and base metals to rare earths.”
Pivoting to Critical Metals, Minerals
Rover Metals is in the midst of pivoting from gold to critical metals and minerals. It also recently announced it had closed on a deal involving the Indian Mountain Lake copper and zinc project in the Northwest Territories.
Rover said it had verified high-grade lithium surface samples at Let’s Go Lithium of 780 parts per million lithium (ppm Li), 910 ppm Li, and 710 ppm Li. Further analysis of samples using handheld laser-induced breakdown spectroscopy found results of 1,218 ppm Li, 778 ppm Li, and 724 ppm Li.
Culter said the company is readying a US$200,000 reverse-circulation drill program to follow up on those high-grade samples. That exploration money will also be the company’s required earn-in to a 100% ownership of the project.
The greenfields lithium project includes hydro power lines, direct road access, and a nearby town with a readily available workforce, the company said.
Now Culter is looking to the results of the Clayton Valley feasibility study to see that “the economics of recovery are profitable.”
But he said as an industry, “from 2023 to 2027 and beyond, it’s a great spot to be.”
Ownership and Share Structure
Culter and family members own about 2 million shares of Rover, and directors Keith Minty and Louis Covello own about 250,000 and about 50,000, respectively. There are no institutional shareholders, and the rest are retail.
Rover’s market cap is CA$2.23 million, and it has 26.3 million shares outstanding, 24.9 million of them free-floating. It trades in a 52-week range of CA$0.42 and CA$0.06.
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