The program is based on very positive results from several months of gravity and magnetic (EM) surveying that concluded in mid-September 2010 (all information from both stages of exploration is available at http://amerilithium.com).
The program’s 3 initial holes will test areas of significant Lithium brine potential identified by the Company’s exploration program (i.e., areas marked by gravity lows and low resistivity), followed by the remaining 5 holes depending on the initial drilling results. By penetrating the formations comprising the basin fill in Paymaster Canyon, the holes should allow AmeriLithium to examine and sample the stratigraphy and lithology of the sedimentary sequence; the nature and extent of the saturated zones; and the concentration of Lithium and other constituents in the groundwater in these target zones.
"With the third stage of our exploration program on our Paymaster Project imminent, we are in a very exciting time for both the Company and the Lithium industry as a whole," said Matthew Worrall, AmeriLithium’s CEO. "It’s also great to have sufficient funding to continue the development of the Company and its exploration work. We’re definitely looking forward to seeing the initial results of the drilling program."
Additional drill program details are provided further below.
PAYMASTER PROJECT BACKGROUND
AmeriLithium’s domestic Paymaster Project represents a 5,880-acre claim block adjacent to the Clayton Valley playa, where Lithium-rich brines and evaporates have been accumulating for more than 30,000 years, resulting in the highest Lithium content found in any brines tested by the US Geological Survey (USGS) in southwestern US playas and basins.(1)
Clayton Valley is home to the only US-based Lithium producing plant, operated by neighboring Chemetall Foote Corporation, a subsidiary of Rockwood Holdings, Inc. The plant has been in production since 1967, producing an estimated 50 million kg (55,000+ tons) of Lithium to date from the region’s rich brines.(2)
In early October 2010, rough preliminary volume estimates for AmeriLithium’s Paymaster Project pointed to the potential for 7,500 to 26,000 tons of Lithium resource underlying the property. With Lithium carbonate trading in the range of $5,500-$6,000 per metric tonne based on a Q3 2010 report by Resource Capital Research,(3) AmeriLithium’s potential Lithium resource on this single Nevada property could represent a market valuation from $132.8 to $144.9 million. The Company’s Lithium holdings also include two other Nevada-based projects nearby, as well as claims in Canada and Australia.
8-HOLE DRILL PROGRAM DETAILS
During the drill program’s planning phase, the size of equipment needed was of considerable significance. The large water well drilling rig suitable for completing the proposed drilling program is, of necessity, large and heavy. Since the soft, unconsolidated surface soils in Paymaster Canyon would make it difficult, if not impossible, to navigate the rig to areas where roads do not already exist, the Company has planned to use existing, improved and maintained roads to the fullest extent possible.
The first three holes (DH-1, DH-2, and DH-3) were placed to test the main gravity and EM anomaly in the north part of Paymaster Canyon. As with all the drill targets, this large, primary target was identified by the Company’s prior exploration efforts, and lies in the area around gravity station 50 and EM stations 28, 29, 50, and 51.
The locations for holes DH-4 and DH-5 are in the area of the northern extension of the main gravity/EM anomaly, the target area at the north end of the elongate zone identified in the area of gravity stations 79, 80, and 81.
DH-6 is situated in the gravity low in the area of gravity station 21. DH-7 is located near the center of the small anomaly identified at gravity station 5. DH-8 is designed to test the extreme south end of the Paymaster property in the north end of Clayton Valley proper. The hole is proposed to be drilled on the road between gravity stations 262 and 263 while testing the gravity low and the very low resistivity anomaly found in this area by the geophysical surveys.
Lithium is a lightweight metal used in a wide range of consumer products the world over: the medical industry uses Lithium as an anti-depressant; industrial uses include glass, ceramic and porcelain enamel manufacture; the aviation industry uses Lithium in alloys. Of particular interest is the use of Lithium for battery production, which has expanded significantly in recent years due to rechargeable Lithium batteries being used increasingly in electrical tools and in the rapidly expanding portable electronics market. Furthermore, the next generation of hybrid and electric vehicles are being designed to use high-capacity Lithium-ion batteries as environmentally-friendly fuel alternatives while the Obama administration has introduced $5 billion in funding and incentives for the development of a secure, domestic battery industry with special focus on Lithium-ion batteries.
AmeriLithium is a publicly traded (NASD OTC BB: AMEL), mining company committed to progressively developing into one of the leading American players in the global Lithium industry. The Company is headquartered in Henderson, NV. AmeriLithium has amassed a Lithium portfolio consisting of ~724,000 acres, including three Nevada-based projects nearby the only Lithium producing plant in the US, a large project in Alberta, Canada, and a project in Western Australia.