When Neo Lithium started early stage exploration they recovered surface lithium grades of 190 mg/L compared to 373 mg/L for Portofino Resources adjacent Yergo property.
If you believe in the old adage, “the best place to find a deposit is near an existing one,” you should consider Portofino Resources (TSX-V: POR). This Vancouver-based company has signed a LOI for 100% interest in the Yergo lithium brine project located in Argentina, in the heart of the Lithium Triangle, along with the Allison Lake North, Greenheart Lake and McNamara Lake lithium properties in Northwest Ontario. Portofino also owns five gold projects in Canada, and is overseen by an exceptional management team with deep experience in the resources industry.
One of the reasons that all eyes are on the Yergo project is the growing demand for lithium to support the green revolution. As one of the world’s lightest metals, lithium is playing one of the largest roles in our green and clean future. The EV global market is already seeing parabolic growth, from $140 billion back in 2019 to a predicted $700 billion in 2026. In turn, analysts have warned that this has put incredible pressure on existing battery metal supplies.
“We don’t think that the raw material supply-side is ready for the wave of demand that is coming…the rapid rise in raw material demand sees deficits forming over the next decade even if we assume all known projects come to market,” predicted UBS analysts earlier this year.
By 2025, almost 75% of all the world’s lithium output will be dedicated to just electric vehicles, if not even more. The IEA expects demand for lithium to surge by a staggering 40-fold by 2040.
This has industry experts asking – where will the supply come from?
Sharing a similar geological history with a world class asset
Argentina, Chile, and Bolivia comprise what is known as the Lithium Triangle, and these countries host a whopping 75% of the world’s lithium resources. Portofino’s Yergo project is a salar located approximately 15 kilometres southeast of Neo Lithium’s 3Q project – one of the largest and highest-grade lithium brine deposits in the world. It was initially discovered in late 2015 and took only five years to advance to the construction phase. In October of this year, Neo Lithium announced it had received an all cash, takeover offer of $960 million for all its outstanding equity from Zijin Mining.
Situated in the Lithium Triangle which accounts for >40% of global production in concentrates and >90% of lithium brine resources, Yergo’s close proximity to the 3Q project is significant because the 3Q deposit hosts some of the lowest sulfate and magnesium impurities, classifying it as a world class asset. Furthermore, the 3Q project has measured and indicated resources of lithium grades of >900 mg/L. Portofino’s Yergo project is potentially an extension of the same salar as this neighbouring project with similar grades and low impurities. David Tafel, Portofino’s President and CEO commented:
“Given the proximity of Neo Lithium’s 3Q project, it is likely that the Aparejos salar has experienced a similar geological history, including lithium and potassium enrichment, due to their common evaporitic climate and local geology. The 3Q and Yergo projects are located within the same volcanic package likely with exposure to the same potential lithium source rocks and mineralizing processes.”
Portofino carried out an initial exploration program at the Yergo property in 2019 which included surface and near-surface brine sampling and geological mapping. The sample results reflected values of up to 373 mg/L lithium with low impurities. Following the initial sampling program, Portofino conducted a geophysical survey and geochemical sampling program in 2021. The project is drill ready with an initial drill program expected to commence shortly which will test the volume and content of the brines.
Neo Lithium’s early stage exploration at their 3Q project in 2016/2017 recovered initial surface lithium grades of 190 mg/L compared to up to 373 mg/L for Yergo. Subsequently, Neo Lithium discovered surface samples in the northern salar containing an average lithium concentration of 784 mg/L.
While we’re not implying that Yergo is definitively an extension of 3Q, we believe it’s a high odds possibility, and results from the their drill program will prove out Yergo’s significant potential.
In April 2021, Portofino reported that it was adding to its lithium portfolio with the acquisition of the Allison Lake North lithium and rare elements property, located 100 kilometres east of Red Lake, Ontario. It is accessible by logging roads while a hydro-electric power line runs through the property. Ontario is home to several well-known lithium and rare element deposits, notably the PAK lithium deposit along the “Electric Avenue,” as well as the Spark deposit.
Portofino completed a channel sampling and initial exploration program at the Allison Lake project in June, 2021. Initial grab samples returned values up to 398 ppm Li, 90.5 ppm Cs, 1040 ppm Rb, and 135 ppm Ta. Looking forward, this project will be the focus of an expanded geological exploration program.
This is highly significant when considering that the global quest for electric vehicles and clean energy has caused lithium to emerge to the forefront as one of the most necessary components for lithium-ion batteries.
Furthermore, the processing of lithium brine to produce battery-grade lithium carbonate is a relatively simple process which has been tested for over 20 years. With the Zijin Mining proposal to acquire Neo Lithium for its 3Q project, it’s not a stretch to assume that other acquisitions and joint ventures will follow.
Add in a high-grade gold portfolio
In addition to it’s two lithium projects, Portofino also holds the South of Otter and Bruce Lake projects in the Red Lake District, as well as Gold Creek, Sapawe West, and Melema West projects in the Atikokan District of Ontario. Both South of Otter and Bruce Lake projects are proximal to the Dixie Gold project, a high-grade gold deposit currently being explored by Great Bear Resources Ltd. (TSX-V: GBR). In the Atikokan District, the Gold Creek property is located immediately south of the Shebandowan Ni-Cu mine, and the Sapawe West and Melema West properties are located east of Atikokan.
As noted above, the Red Lake District has been a hotbed of exploration activity as Great Bear Resources, PureGold Mining (TSX-V: PGM), and others have been exploring and developing the area’s prolific mineral potential. Past production and current resources in the Red Lake Gold Camp have been estimated at 41 million ounces of gold.
With a drill program about to commence we believe smart investors will be quick to pick up on the lithium potential of Portofino’s Yergo project with the added kicker of a strong gold portfolio located in highly prolific geological areas.
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