Co. May Have Discovered Untapped Lithium Deposit

Usha Resources Ltd. (USHA:TSX.V; USHAF:OTCQB) has announced that it has decided on a share distribution record date, March 24, regarding the planning of the arrangement between the company, Formation Metals Inc. (FMI), and shareholders of the company.

Shareholders will receive one common share of FMI for every five shares they hold with Usha Resources, as long as at the time of the share distribution record date, they have exercised their warrants or options with Usha. 

FMI is a subsidiary of Usha Resources, the company having gained approval for the spin-out in early January. It will take over Usha’s Nicobat Nickel project, a nickel-copper-cobalt mine located in northwest Ontario, while Usha continues to focus on lithium exploration projects. 

Usha has stated that the Nicobat project includes "active mine development", and has "excellent road and rail access, power, and water." Results from recent samples show "up to 2.6 wt% Ni and 0.17 wt% Cu above 100 meters depth."

The National Investor’s Chris Temple referred to the company’s 9,000 acres on the Jackpot Lake property as "unique among the numerous Nevada-centric exploration stories."

The company plans to invest CA$250,000 into future drilling programs at the site, with two main exploration targets.

According to its website, Usha Resources Ltd. is a junior exploration company, headquartered in Canada, focusing on high-grade precious and base metal projects across North America. It recently tripled the amount of land it controls at its Jackpot Lake Lithium Brine Property, which will continue to be a key project in its lithium exploration efforts. 

The National Investor’s Chris Temple referred to the company’s 9,000 acres on the Jackpot Lake property as "unique among the numerous Nevada-centric exploration stories."

On February 28, newsletter writer, Penny Queen, noted, "Usha's second hole is looking very pretty! The geology at Jackpot Lake is looking more like Albemarle Corp.'s Clayton Valley. They're also looking at additional lithium properties. This and expanding their Jackpot claim tells me they are confident!"

Lithium Exploration: Hope For Our Future

Because of its integral use in rechargeable batteries for electronic devices like cell phones, laptops, and electric vehicles, lithium is an increasingly hot commodity. As the world looks ahead to a greener, more sustainable future, experts believe that lithium’s demand will continue increasing as more people decide to buy electric or hybrid vehicles.

According to Fortune Business Insights, the lithium market is expected to grow from "US$3.83 billion in 2021 to US$6.62 billion in 2028," 

Pablo Altimiras, Executive Vice President of Chile-based mining company SQM, said that lithium is such a great option for use in electric vehicles because it is "the lightest metal in the world", which makes it perfect for a product in which you have limited space to store a lot of energy, such as a car. 

According to Fortune Business Insights, the lithium market is expected to grow from "US$3.83 billion in 2021 to US$6.62 billion in 2028," which will likely be driven by growing demand for its use in the manufacturing of products like mobile phones, laptops, and electric vehicles. 

Fortune Business Insights also stated that the "market in North America is likely to rise at a considerable pace," due to increased interest in and usage of clean energy.

Usha’s Multiple Upcoming Catalysts

As well as continued exploration at Jackpot Lake, Usha has an eventful couple of months coming up. Usha Resources CEO Deepak Varshney previously spoke about how pleased the company was with progress in their drilling efforts, stating that the company now looks forward "to proceeding with JP22-2 and the rest of the program as we move closer toward our goal of defining a 43-101 resource."

Deepak Varshney also mentioned that the geologic conditions at the Jackpot Lake Property are similar to those at Clayton Valley, "which hosts Albemarle’s Silver Peak Nevada Lithium Mine, the only producing lithium mine in North America."

He said the company is "optimistic in thinking that we may have discovered an untapped lithium deposit." 

Albemarle is a 'global specialty chemicals company with leading positions in lithium, bromine, refining catalysts, and applied surface treatments.' It’s headquartered in Charlotte, NC.

The company will also give more information about the acquisition of an advanced lithium pegmatite project in Ontario, as well as other similar acquisitions.

Ownership and Share Structure

13.3% of Usha Resources shares are owned by management and insiders. CEO Deepak Varshney owns 5.04% of shares, with 1.8 million shares, while Director Navin Varshney owns 7.1%, or 22.53 million, valued at CA$1 million.

According to Reuters, 15.03% is with institutions and strategic investors. Out of this category, Palos Management Inc. has the most at 1.77%, with 0.63 million shares. 

The rest is in retail.

With headquarters in Vancouver, BC, the company’s market cap is CA$12.1 million, with 35.65 million shares outstanding. The company trades at a 52-week range of between CA$0.2050 and CA$0.4200. 

Disclosures: 

1)  Lauren Rickard wrote this article for Streetwise Reports LLC as an independent contractor. They or members of their household own securities of the following companies mentioned in the article: None. They and members of their household are paid by the following companies mentioned in this article: None.

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