All units of measure are in metric tonnes unless otherwise indicated.
TORONTO, July 21, 2016 /CNW/ - Enirgi Group Corporation ("Enirgi Group"), a global diversified industrial and specialty chemicals company, and Lithium S Corporation ("Lithium S"), a company engaged in the acquisition and exploration of greenfield lithium brines in Northern Argentina, announced today that they have entered into a Memorandum of Understanding (the "MOU") with respect to a strategic collaboration on the exploration and development of lithium projects in Northern Argentina.
Highlights of the MOU
- Enirgi Group and Lithium S will combine their portfolio of mining properties and exploration permits (the "Properties") to enable the collaboration of the exploration of lithium projects in Northern Argentina (excluding Salar del Rincón Properties).
- Enirgi Group will take an equity stake in Lithium S, following a successful Lithium S capital raise.
- Lithium S will enter into a Management Services Agreement ("MSA") with Enirgi Group for the provision of certain management and operational support.
- Lithium S will enter into a Technical Support Agreement to support the exploration of the Properties and to study the feasibility of future lithium operations on the Properties by utilizing Enirgi Group's proprietary Direct Extraction Process Technology (the "DEP Technology").
Enirgi Group, having recently announced its strategy to create a global lithium business and positive results of its Definitive Feasibility Study (the "DFS") for its planned 50,000 tonne per annum lithium carbonate processing plant at its Salar del Rincón project located in the province of Salta, Argentina (the "Rincón Project"), is pursuing its longer-term plan to increase its production capacity by scaling the Rincón Project into a larger Regional Processing Facility ("RPF") that will utilize Enirgi Group's game-changing DEP Technology for the development of the Salar del Rincón and other lithium brine salars.
"The proposed collaboration with Lithium S will accelerate Enirgi Group's previously announced global lithium strategy," noted Mr. Wayne Richardson, President & CEO of Enirgi Group. "Not only will it expedite the development of Enirgi Group's non-Rincón mining concessions in Argentina, it will also allow for the study and commercialization of Enirgi Group's Direct Extraction Process Technology to lithium brines in other salars held by Lithium S. We believe that this relationship could provide the necessary exploration program to expand our Rincón Project into a larger regional processing facility in the future."
Strategic Plan of Cooperation
Pursuant to the terms of the MOU, Enirgi Group has agreed in principle to assign its non-Rincón Properties into Lithium S in exchange for an equity stake in Lithium S following a successful Lithium S capital raise (the "Transaction"). Lithium S has entered into option agreements on a number of mining properties and exploration permits located on lithium brine deposits in Northern Argentina.
Lithium S and Enirgi Group plan to enter into a MSA, pursuant to which Enirgi Group will provide certain management and operational services to Lithium S through an experienced in-country team, inclusive of geologists specialized in lithium exploration and development in Argentina as well as local legal and administrative services. The team will operate out of Enirgi Group's existing office in Salta, Argentina.
Following the completion of the Transaction, the Chairman of Lithium S shall be Wayne Richardson, Enirgi Group's President and CEO. Directors will also include the Honourable J. Trevor Eyton, Stephen Dattels and Juan Carlos Grosso, Lithium S's Argentine representative.
Strategic focus and Application of the DEP Technology
Enirgi Group and Lithium S's immediate strategic focus will be on the rapid exploration and development of its Salars that have the potential to economically supply lithium brine to the expanded RPF. Enirgi Group expects to undertake programs to analyse the feasibility of applying its DEP Technology for the purpose of developing the Properties, which may include concentrating the brines on the various exploration properties for the purpose of serving as additional feed to the RPF.
Upon recovery of the lithium, the brine will be recycled back into the Salars, which minimizes the impact on the environment. The DEP Technology has demonstrated recoveries in the range of 75%-85% range with brine sourced from the Rincón Project, which is well above the industry norms. Enirgi Group's Chemical Division and Innovation Division are working on strategies to leverage the application of the DEP Technology to other lithium brine resources in the region. This may allow brines that were once deemed 'difficult to process' or uneconomical to become economically viable with the application of the DEP Technology.
About Enirgi Group Corporation
Enirgi Group is a privately held specialty chemicals and diversified industrial company with six unique divisions that own and operate a portfolio of high-quality assets and operations located around the world. Enirgi Group's Chemicals Division is advancing the development of Enirgi Group's lithium project located in the province of Salta, Argentina. Enirgi Group is focused on developing innovative technologies to sustainably progress a number of development projects around the globe with the goal of becoming a leading low-cost, high quality producer of specialty chemicals and energy storage solutions.
Enirgi Group is wholly-owned by The Sentient Group of Global Resources Funds. The Sentient Group Limited is an independent private equity investment firm specializing in the global resources industry with over $2.7 billion of assets under management in metal, mineral and energy assets across the globe.
About Lithium S Corporation
Lithium S is a privately owned minerals exploration company which is focused on lithium brines in Argentina. The Company was co-founded by Stephen Dattels and Michael Beck, who are well known mining financiers having developed many successful mining projects internationally.
Enirgi Group and Lithium S are privately held companies and are not reporting issuers under Canadian securities laws.
Cautionary Note Regarding Forward looking statements
This news release contains forward-looking statements about Enirgi Group Corporation, Lithium S Corporation, their proposed plan of strategic cooperation and their respective businesses. Forward-looking statements are statements that are not historical facts and are based on certain assumptions relating, but not limited to: the negotiation and execution of definitive agreements representing the terms of the MOU, the acquisition of mineral properties in Argentina by Lithium S, the sale of Enirgi Group's mineral properties to Lithium S, future capital raising by Lithium S, the future management of Lithium S, timing for commencement of construction and production from the Rincón Project, receipt of necessary funding and permitting for the Rincón Project, the successful commercialization of Enirgi Group's DEP Technology, the expansion of the Rincón Project into a Regional Processing Facility, the application of the DEP Technology to other lithium salars owned by Lithium S, the ability of Enirgi Group to meet any amount of future lithium demand from its production and global lithium demand and consumption. Enirgi Group and Lithium S consider these assumptions to be reasonable, based on information currently available, they may prove to be incorrect. The forward-looking statements in this news release are subject to various risks, uncertainties and other factors that could cause the actual results or achievements to differ materially from those expressed in or implied by forward looking statements. These risks, uncertainties and other factors include, without limitation, risks related to uncertainty surrounding necessary capital raising by Lithium S; uncertainties relating to the acquisition of mining and exploration claims in Argentina, risks related to uncertainty in the demand for lithium and pricing assumptions; uncertainties related to raising sufficient financing to fund projects in a timely manner and on acceptable terms; changes in planned work resulting from logistical, technical or other factors; the possibility that results of work will not fulfill expectations and realize the perceived potential of the Lithium S or Enirgi Group's properties; uncertainties involved in the estimation of lithium reserves and resources; the possibility that required permits may not be obtained on a timely manner or at all; the possibility that capital and operating costs may be higher than currently estimated and may preclude commercial development or render operations uneconomic; the possibility that the estimated recovery rates may not be achieved; risk of accidents, equipment breakdowns and labor disputes or other unanticipated difficulties or interruptions; the possibility of cost overruns or unanticipated expenses in the work program; and risks related to projected project economics, recovery rates, and estimated NPV and anticipated IRR and other factors. Forward-looking statements are based on the beliefs, opinions and expectations of Enirgi Group and Lithium S's management at the time they are made, and other than as required by applicable securities laws, the companies do not assume any obligation to update its forward-looking statements if those beliefs, opinions or expectations, or other circumstances, should change.
SOURCE Enirgi Group Corporation
For further information: Enirgi Group Corporation, Jessica Helm, VP Corporate Communications, 1 Adelaide Street East, Suite 3001, Toronto, Ontario, Canada M5C 2V9, P | + 1 416 956 5122 E | email@example.com W | enirgi.com; Lithium S Corporation, Ian Burns, 27 Reid Street, Hamilton HM NX, Bermuda, P | + 44 1 295 1820 E | firstname.lastname@example.org