Lithium explorer Lake Resources (ASX: LKE) has been given the green light to start its maiden drilling program at its Kachi lithium brine project in the Argentinian province Catamarca, which is situated in South America’s Lithium Triangle.
Lake Resources’ managing director Steve Promnitz said the local community supported the project and was “keen to see it progress”.
The company has made initial payments for a diamond drill rig, which will be used to drill 1,000m across the project’s 50,000 hectares.
Earlier near-surface brine sampling returned positive lithium results up to 322mg/L, which the company anticipates it will build on in the current drilling campaign.
“This makes an important step in unlocking value over the lithium assets,” Mr Promnitz said.
Last month Lake Resources signed a letter of intent with the Catamarca Government to accelerate the Kachi lithium project through its various exploration and development permits.
Lake Resources has actively pursued community engagement and Mr Promnitz said local community representatives had commented this was the first time a mining company had engaged directly with the local population.
The company owns 100% of the project via its Argentine subsidiary Morena del Valle Minerals SA.
South America’s Lithium Triangle
According to Lake Resources, it holds one of Argentina’s largest lithium tenement packages encompassing 170,000 hectares in the Lithium Triangle, which currently produces half of the world’s lithium.
The Lithium Triangle crosses through South American countries Bolivia, Argentina and Bolivia and hosts 54% of the world’s known lithium resources.
The lithium market is forecast to be work more than US$77 billion by 2014, industry analyst Transparency Market Research reported.
On news of the imminent drilling campaign, Lake Resources’ stock had soared more than 20% by early afternoon trade.