Shanthar Pathmanathan: Look, I think clay stone has a big part to play in the global lithium supply equation. Clay stone is orders of magnitude larger in terms of the net lithium contained in the resources, than hard rock lithium. However, there’s no current production of lithium carbonate from clay stone hosted lithium. Clay stone hosted lithium is a large scale, longer term opportunity. Shorter term we intend to keep those clay stone hosted assets, some of which we operate and others we have divested off to other companies to operate for us. The hard rock lithium will very much be our short term focus and that’s what we will spend about 80% of our capital and time developing in the short term.
Paul Sanger: And I guess it’s an obvious question, why are so many projects in your portfolio?
Shanthar Pathmanathan: The availability of lithium assets with mineralization at surface is a luxury of the time we’re in today. It’s very much an early mover advantage that we are seeing there. And so to that end, we want to seize on these opportunities with assets, with lithium mineralization at surface, bring them into our portfolio and then figure out how to advance those. Whether it be on our balance sheet or whether we continue to do the various divestments we’ve done. But we think the key is to have assets where the mineralization is there, and then in terms of management and capital, I think those are problems we can then solve down the road. So we see it as a luxury of our time that we’ve got these assets similar to at the beginning of other industries like the oil industry a couple of 100 years ago where they had oil assets which had seeps at surface. So it was for that reason to take seize on the opportunity to acquire these assets with mineralisations at surface. And that’s why we’ve got so many assets.
Paul Sanger: Bit of an obvious question, but tell us why you have so many projects in your portfolio. How do you see that as an advantage for Chariot?
Shanthar Pathmanathan: The US has got these opportunities are pretty ripe for exploration, right? So assets with lithium mineralization and surface and as I said, the US is 10 years behind Australia. So to that end, we think this is a luxury of our time that we have these opportunities. So we think it’s prudent to acquire and bring these into our portfolio and certainly we’ve done that to date. We have, as part of that process also divested four assets to four public companies. Our cost, there was about a million and a half US dollars and we’re able to successfully execute on those divestments for total proceeds of 16 and a half million USD. So those assets are by default on other people’s balance sheets, they’ll be operated and funded by other public companies, giving us some additional capital as well to focus on our core assets, which are the Black Mountain and resurgent projects.
Paul Sanger: Wyoming, water supply. All good?
Shanthar Pathmanathan: With our process, it’s hard rock lithium, so it’s not the brine and the stone and all that. So we’ve got a lot of clay stone, but the water with hard rock is a minimal issue. It’s just the processing requirement. It’s not for the actual.
Paul Sanger: Yeah, okay.
Shanthar Pathmanathan: With brine, you actually literally depleting a reservoir.
Paul Sanger: Yeah, okay.
Shanthar Pathmanathan: And you can’t pull stuff out unless you have water rights. Okay? With our hard rock lithium, minimal water required. And then moreover, Wyoming is not that dry of a state. Right?
Paul Sanger: And with the permitting, who owns the land, where your projects are?
Shanthar Pathmanathan: These are called unpatented claims.
Paul Sanger: Yeah. Okay.
Shanthar Pathmanathan: They’re administered by the Bureau of Land Management, the federal body, US federal government. We are the owner of those claims. So we’ve paid or acquired, we’ve done three deals with two different vendors. We have staked most of our own ground. So we’re the registered owner with the Bureau of Land Management. That in entails some payments every year. The annual holding costs is about 750,000 Australian dollars per year. So it’s a pretty substantial cost, but we’ve also got a pretty large land position in the US. So our companies have an underlying a 100% interest in these claims.
Some of our geologists do have a minority interest in some of the subsidiaries that we use to operate over there. So we’re the owner, but it’s federal ground. We have the rights to the mineral endowment of that ground. There are situations where cattle ranches have got grazing rights, so even during exploration, the cattle ranches can temporarily bring their cattle onto the property, graze it. They have no underlying title, they have no freehold title, and then as required they’ll be moved off in terms of converting these to mining leases, they will all have to be removed from the properties, longer term.
Paul Sanger: And if you’ve got any neighbours that currently have assets digging spodumene in Wyoming, any other big companies around you?
Shanthar Pathmanathan: No.
Paul Sanger: When you said Wyoming, I can’t think of one that I’ve heard something. I’ve heard Oregon, Nevada and what have you. But first one I’ve heard Wyoming.
Shanthar Pathmanathan: Yeah. So we had to go through a competitive auction process to get hold of this property. So it was a couple of bidders. One billion market cap company.
Paul Sanger: Yeah, interesting.
Shanthar Pathmanathan: But once we secure that property, we realized that good drill results from this property is going to trigger competition. So we’ve taken out the whole state in terms of opportunities. We’ve got six other swarms of pegmatites, right? That we have taken out some 700 pegmatites in our portfolio in Wyoming. The way I see it, this it could be the Gulf of Mexico for lithium, sitting in the heart of the US, and it’s incumbent on us to get control of that early before the competition can move in. South Dakota is the next state and there’s a bit of activity over there. There’s another ASX listed company that’s just drilled into some spodumene bearing pegmatites there. So same geology, but Wyoming, it’s more suitable I think for developing a mine. It has population of 600,000 people bodes well in terms of developing a mine and it’s already a resource that it produces a coal, uranium, oil. So it is an ideal position for us to be, and we’ve taken a strategic position there by taking out all of available opportunities preemptively.