Kali Metals Expands Portfolio with Strategic Tenement Addition in Lachlan Fold Belt

Kali Metals (ASX: KM1) has expanded its portfolio and has acquired land for mining and extraction purposes in the Lachlan Fold Belt under the Jingellic Lithium Project located in the south of NSW (New South Wales). The company has acquired strategic and extraction rights to mine lithium. Along with that, there are significant expansions in other regions as well, as the company is pacing the process of attaining lithium. Let us know about all these developments in detail.

Kali Metals Acquires Mining Land

According to the announcement by Kali Metals on ASX dated March 7th, 2024, it was stated that the company has acquired a significant land share increasing the mining region of their Jingellic Lithium Project to 226 sq km. The Jingellic Lithium Project is in the north of Kali’s Lachlan Ford Belt Project. The announcement also closes a major Geological gap that previously existed when the company started mining the region but could not mine the recently acquired spot. 

Kali Metals has also started its soil sampling program in its sweetwater prospect area which is adjacent to the giant Pegmatite. Rocks that had deposits of Lithium that came into use were taken out of the Pegmatite. 

Kali Metals’s agreement with MEG

Kali Metals has entered into a binding agreement with Mining and Energy Group Pvt Ltd (MEG) to acquire tenement EL8958 for its Lachlan Fold Belt Project. On 3rd November 2023, Kali Metals provided a prospectus and an optional method that MEG could accept for the option payment of $225,000 in the form of scrips (allotted shares) which will be set at an optional date, the average price of the 30-day performance from a set optional date of the allotted shares shall be provided, that shall be the ownership module of shares.

A Pegmatite Outcrop
(Source: https://www.marketindex.com.au/)

Geological Advantages of Acquired Tenement

The recently acquired Tenement addresses a longstanding challenge in the extraction of Tri remains. As ongoing discoveries unfold, it aligns with the geological timeline of the region, shedding light on the historical metal procurement process, which has been previously unknown.

The company plans to expand more in other regions hoping to acquire more lands and properties that could provide favorable traces of Lithium and other metals. In the southwest of the Lachlan Fold Belt Project, the sweetwater spot that has been located reaffirms the existence of Pegmatite which acts as a perennial resource for the manufacturing of Lithium products once the extraction is complete. A 600-different soil sampling spacing 150 x 150 program has been underway to provide extensive detail about soil conditions and also the kind of metals it can have. 

Kali Metals’s Managing Director as per the ASX announcement on 7th March 2024 said in a statement, Graeme Solan, “The addition of EL8958 is an important part of our exploration plans for the Jingellic Lithium Project. It not only links what were previously two separate tenement packages but provides an entirely new exploration front with a number of tin anomalies extending throughout the tenement. Tin is seen as a positive geological indicator for lithium.”

The acquisition adds another 226 sq. km to the Jingellic Lithium Project and will make exploration in the area more cost-efficient given the now contiguous nature of the combined tenements. At Sweetwater Station, results from our first-ever soil sampling program are eagerly awaited. The Sweetwater area contains what is colloquially known as the “Giant Pegmatite” which is targeted for follow-up work once approvals are in place. The results from the soils program are expected to be available during Q2 2024”.

Photo of Higginsville Lithium District
(Source: https://kalimetals.com.au/)

More High-Grade Lithium in Higginsville

Along with the Lachlan Fold Belt Project, Kali Metals is doing a lot of extraction in other areas especially Spargoville and Widgiemooltha Projects in Higginsville Lithium District. On 13 February 2024, an ASX announcement was released mentioning the findings of lithium traces in soil and lithium embedded in rock chips in Higginsville. 

Soil anomalies also tended in a different direction suggesting there is a possibility of more mineralization in the soil indicating more minerals apart from Lithium. The announcement also stated the positives of doing geochemical testing in the region to accumulate traces of different minerals. There will be drilling starting at Spargoville Project in 1st half of 2024 to expand the contours of assessment. There are at least 20,000 geochemical soil samples available in the Higginsville Lithium Project.

Kali Metals’s IPO on Positive Trend

Kali Metals’s IPO was listed on the market on Wednesday, 6th March 2024. The company aimed to raise $12 to $15 million, which was oversubscribed within 20 minutes, as reported by the Australian Financial Review. 

Kali Metals’s Managing Director Graeme Solan, states to the press that he is extremely elated and happy to see people supporting Kali, and seeing significantly well-known investors and shareholders putting money into the company makes him joyful. He also believes that the people involved with the company will take the company forward and support it.

The oversubscription of IPO also indicates that investors are not able to own a significant chunk of the share, some high-valued investors could only gain a 10% stake in the company. Some of the major buyers of Kali’s shares include:

• Primarily Kalamazoo Resources at 22.1% and Karora Resources at 20.2% are the largest investors to Kali Metals. Kali Metals is a spin-out of both companies.
• Wabelo owns 4.85% of the company. Wabelo is Minres’s MD Chris Ellison’s company.
• Warburton owns 2.77% of the company. Warburton’s Director is former Director of MinRes Tim Roberts.
• Carjay Investments owns 2.52% of the company. Carjay Investments is Rob Jones’s company who is also the founder and Chairman of Navitas, a global educational and learning services company.

The last traded price of Kali Metals stock closed at up 2.2% amounting to A$0.45 for each share making the company’s market capitalization reach A$34.73 million.