IT IS not every day that a resources company lays claim to be sitting on a deposit with a value of more than $44 billion. But that is what Queen Street-based Admiralty Resources has claimed for the lithium locked up with potash brines at its Rincon Salar project in northern Argentina.
Lithium is a boom metal thanks to increasing use in hybrid car batteries and those found in hand-held devices of all types. Potash has been no slouch either as demand for its fertiliser properties rise in line with living standards in China and India.
A new reserve estimate for Rincon, released yesterday, showed that Admiralty has both in spades. But turning that in-the-brines potential into a profitable business is another matter. Admiralty noted that the new reserve estimate would at least "assist with the current negotiations for project financing for which the construction budget is $US106.4 million".
Admiralty reckons the brines at Rincon contain an expected 1.4 million tonnes of lithium (expressed as a metal and after 75 per cent recovery) and 50.8 million tonnes of potash (expressed as potassium chloride and after 70 per cent recovery).
It's almost a case of too much of the stuff, with the company pointing out that the reserves would last for 400 years at its current production target of 17,000 tonnes of various lithium products.
Admiralty shares rose 18.5¢, or 46 per cent, to 58.5¢. Good anticipation of the reserve upgrade — lithium was up fivefold and potash even more so — has resulted in the shares rising to yesterday's stronger closing from as low as 10¢ at the start of the year. Admiralty is now valued at more than $500 million.
The project is in the Salta province of Argentina at an altitude of 3740 metres. Covering an area of 280 square kilometres, Rincon is a so-called endoheic or "closed" basin, with no water escaping. Annual evaporation is among the highest in the world at 3000 millimetres.
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