Lake Resources N.L.

Produced Lithium Carbonate with 99.9% Purity: Lake Resources N.L. (ASX: LKE) is engaged in the exploration and development of lithium. Recently, the company announced that it has sent additional brine from its Kachi Lithium Brine Project, Argentina, to California, USA, in order to produce larger samples from the pilot plant using the company’s lithium direct extraction process.

Recently, the company reported the appointment of Dr Robert Trzebski to the Board. Dr Robert Trzebski holds considerable operating and commercial experience across Argentina and Chile. He has also worked as a Non-Executive Director of Austral Gold since 2007, listed on the ASX and TSX-V and is Chairman of the Audit and Risk Committee.

Update on Battery Grade Lithium Carbonate: On 09 January 2020, the company released a market update notifying that it has produced battery grade lithium carbonate with 99.9% purity and with very low impurities from Lake’s Kachi Lithium Brine Project using Lilac Solutions’ disruptive technology in California. As per the company’s update, Lithium carbonate with 99.9% purity exceeds the industry standard specified for battery-grade purity, i.e., >99.5 wt%.
The company produced samples from the first pilot facility modules using Lilac Solutions’ direct extraction ion exchange process. The above process was tested over the period of nine months, which was intended to optimise the process for Kachi brine samples. The above information is likely to be used in the Kachi Pre-Feasibility Study (PFS).


Chemical Component Index (Source: Company Reports)

The company is focusing on producing higher volume samples of battery grade lithium carbonate specifically for potential downstream off-takers in negotiations with LKE. As per the lab testing, the lithium concentrations of 30-60,000 mg/L lithium can be produced from brines of ~300 mg/L lithium in a few hours using the Lilac process.

Cash Flow Highlights for the Quarter ended 30 September 2019: LKE announced its quarterly cash flow report, wherein the company reported net cash used in operating activities at $3.008 million and net cash generated from financing activities at $1.386 million as on 30 September 2019. The company reported cash and cash equivalents at $91k at the end of first quarter of FY20.

FY19 Financial Highlights for the Period ended 30 June 2019: LKE declared its FY19 results, wherein the company reported a net loss of $3.530 million, as compared to a loss of $3.540 million in FY18. The company reported employee benefit expenses of $0.473 million and corporate expenses at $1.178 million during FY19. LKE reported total assets at $15.245 million, including total current assets of $1.931 million and exploration and evaluation assets worth $13.312 million as at 30 June 2019. At the end of the year, the company had borrowings amounting to $1.428 million, followed by total equity of $12.44 million.

Guidance: For the second quarter of FY20, the company expects total estimated cash outflow of $0.787 million which includes exploration and evaluation expenditure of $0.505 million, staff costs of $0.152 million and administrative and corporate costs amounting to $0.130 million.

Stock Update: The stock of LKE is quoting at $0.051 with a market capitalisation of $17.47 million. The stock is quoting at the lower band of its 52-week trading range of $0.023 to $0.115. The stock has generated negative returns of 18.52% and 58.75% in the last three months and six-months, respectively. The stock closed at $0.051, up 54.545% as on 09 January 2020 on account of the update related to battery grade lithium carbonate with 99.9% purity produced from Kachi.

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