Expanding Brine Testing Initiatives Signal Growth in Lithium Extraction Industry

Lithos Group Ltd. (LITS:CBOE.CA;LITSF:OTCMKTS;FSE:YU8;WKN:A3ES4Q), recognized for its advancements in sustainable lithium production, has announced an expansion in its brine testing operations. This expansion comes with a notable increase in sample submissions from various new mining companies, signaling trust in LiTHOS's proprietary AcQUA™ technology aimed at enhancing lithium extraction efficiency. These developments were facilitated at LiTHOS’s advanced facility in Bessemer, Alabama, which underscores the company's commitment to technological innovation and environmental responsibility.

Why Lithium?

During an administration focused on clean energy, lithium has been a growing sector. In a January 27, 2021 Executive Order, Jennifer M. Granholm Secretary of Energy stated, "Lithium-based batteries power our daily lives from consumer electronics to national defense. They enable electrification of the transportation sector and provide stationary grid storage, critical to developing the clean-energy economy. The U.S. has a strong research community, a robust innovation infrastructure for technological advancement of batteries, and an emerging lithium-based, battery manufacturing industry."

The projections for demand of lithium have been on a steady rise. As Yahoo Finance pointed out on December 22, "Worldwide demand for lithium is expected to double between 2025 and 2030 as more consumers buy electric vehicles. EVs are expected to make up about half of new car sales worldwide by 2035, according to Goldman Sachs research."

Catalysts for Growth

The increasing reception of brine samples from new clients not only highlights the industry's confidence in LiTHOS's technology but also marks significant potential for growth in its client base and technological validation. The successful testing and positive feedback from existing mining clients have further solidified LiTHOS’s market presence, promising ongoing engagements and potential new client acquisitions. Additionally, the reception of samples from a South American mining company extends LiTHOS’s reach into key lithium-rich regions, enhancing its global footprint and operational scope. These factors collectively contribute to LiTHOS's strategic positioning for expanded market influence and potential revenue growth in the lithium extraction industry.

Technical Expert Analysis

Keith Schaefer of the Investing Whisperer had this to say about Lithos on March 5: "Lithos Group Ltd. is doing a US$0.70 financing with a full US$0.90 warrant for three years. . .the company has a very real shot at landing a big customer by the time this financing comes free trading in four months."

20 days later, technical analyst Clive Maund cited Lithos's manufacturing of AcQUA field field system for contracted Tier 1 lithium producers as a cause for celebrating, writing, "This news makes clear why the stock has been under strong accumulation, the evidence of which we have observed in recent weeks and this will put the company in a position to earn revenue in the fourth quarter of this year, and this is the point at which to remind you that this patented system does away with the need for evaporation ponds."

Maund went on to explain what this meant for investors, "Lithos Group is therefore strongly recommended for immediate purchase (or adding to positions), and it is available to investors on the US OTC market, where it now trades in healthy volumes."

Ownership and Share Structure

About 60% of Lithos is held by insiders and management, the company said. According to Reuters, this includes CEO Scott Taylor with nearly 15% or 12 million shares, Independent Director Michael Westlake with 0.73% or 1.6 million shares, and Independent Director Kevin McKenna with 0.05% or 40,000 shares.

About 27% of the company is held by strategic entities. The rest is retail.

Lithos has a market cap of CA$49.04 million with about 83 million shares outstanding. It trades in a 52-week range of CA$0.98 and CA$0.51.

Important Disclosures:

1. Lithos is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000. 
2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Lithos
3. James Guttman wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
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