The recent news flow and results from Rodinia Lithium (RM-TSX-V $0.29) has focused on its initiatives in Argentina, particularly its wholly-controlled Salar de Diablillos.  But the company also has an interesting domestic asset in Nevada that yesterday seemingly received an indirect vote of confidence with this press release from its neighbor Chemetall Foot lithium: Chemetall Begins Expansion of Chemetall Foote Lithium Operation in Nevada.

Rodinia continues to hold high hopes for its Clayton Valley project, which envelopes Chemetall’s operations and land position in Nevada, and management tells me that the news in Nevada has slowed while they wait for approvals for a larger drill program (expected in a few months).

Here’s why yesterday’s Chemetall news appears important for Rodinia:

1. Chemetall’s expansion is funded in part by a grant from the U.S. Department of Energy, once again highlighting the importance of lithium as a strategic metal to the U.S. government.  This may also suggest that government funding could be available to Rodinia in the future.
2. Chemetall’s plans double the capacity of its lithium carbonate production in Nevada.  The knocks on Clayton Valley have been that it’s either not big enough or has been producing for so long that the resource has expired.  Chemetall has the most insight and experience in the valley and must be confident that these claims are unfounded to publicly announce a doubling of production.
3. Chemetall expects to drill new wells, build more evaporation ponds and build a geothermal power plant.  A quick review of the valley’s claim maps highlights a significant problem – Rodinia has all the land around them, where will they expand?

(Clayton Valley claims – Rodinia red border, Chemetall inner hatched area)

Bottomline:

What really sets Rodinia apart from other junior lithium explorers is its project diversification.  Like most juniors, Rodinia has built a stable of brine projects in Argentina, only with Diablillos taking a different strategic spin by ensuring there were no sharing issues on the salar.  But Rodinia also has a U.S. asset in the only known lithium bearing valley in the country with a land position that envelopes the only producer.  The other juniors don’t have this diversification.

Since Rodinia occupies all the land around Chemetall, and since Rodinia has intersected 400 mg/L lithium in the trend to the south of Chemetall, at what point does Chemetall have to start taking Rodinia seriously?

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Posted in A Grandich Company All Posts Canadian Stocks Exploration Shares Lithum Mining Shares U.S. Economy US Stocks by Peter Grandich