Portofino applies for licenses on world's 6th largest lithium salar, Arizaro, Argentina
Shortly before the deadline of an official tender, Portofino Resources (TSX-V: POR, (OTCQB: PFFOF; FSE: POTA) has submitted its application documents for two lithium licenses on the Arizaro Salar in Argentina’s Salta province. The Arizaro Salar is the sixth largest salar in the world and the second largest in Argentina. The salar covers a total area of 1,600 km² . The salar already hosts a number of large licenses from major lithium companies. The results of the tender are expected to be announced as early as the second half of September.
Portofino points out in its press release that success in the tender process is not guaranteed. However, initial (official) feedback indicated that “the company’s financial offers are highly competitive compared to other major lithium companies.” Submitted bids must consider a number of other criteria, including community impact, sustainability, and community/regional benefits. Review of the documents by the relevant Argentine authorities is ongoing.
Portofino, in collaboration with the state-owned resource company in Salta, REMsa, had previously conducted extensive geological due diligence in one of the two concession areas, Arizaro IV. Initial exploration work on the surface of this 8,445 hectare block has revealed a thick overburden (crust). Nevertheless, up to 100 milligrams per liter (“mg/l”) of lithium has been detected in surface samples, which is consistent with surface results from other groups exploring this mature salar. In total, Portofino analyzed more than 40 brine samples at surface, excavated 35 trenches that reached the water table at shallow depths using excavation equipment, and conducted 69,000 meters (“m”) of geophysical survey using Vertical Electric Soundings (“VES”) technology that revealed aquifer depths of up to 1,000 meters. Low resistivity horizons were also identified, interpreted as brine targets, potentially containing large concentrations of lithium (see Figure 2).
The surveyed area shares geological characteristics with other areas in the same salt flat where brines with high lithium content have been detected at depth. Adjacent properties within the Arizaro salar were drilled to depths greater than 500 m and returned prospective levels of 300 m to 400 m with >500 mg/L lithium.
David Tafel, CEO of Portofino, commented, “Our legal, operations and geological teams have submitted two very thorough, well-researched and competitive proposals for the licenses on the Arizaro Salar, and we are confident that our efforts will be rewarded.”
Just a few days ago, Portofino was presented with the opportunity to buy out the (long disputed) option on the Yergo lithium project in Argentina’s Catamarca province. This salar is 2,932 hectares in size and is located only 8 kilometers from the 16,000 hectare salar (3Q project) that Neo-Lithium sold to Zijin Mining for CAD 960 million in 2022. Portofino’s intention is to fully acquire the concession in mid-September this year, and for this reason it is currently conducting a capital increase at CAD 0.10.
Conclusion: coincidence or not - since Portofino brought the two heavyweights Alex Molyneux and Blake Steele onto its Advisory board a few weeks ago, the company has had a run. The licenses Portofino is bidding for are in the heart of Argentina's world-renowned lithium triangle and in close proximity to several world-class lithium projects. Portofino CEO David Tafel has compared the bidding process for the Arizaro licenses to the awarding of oil fields in the North Sea. Of course, there is competition and the acquisition would not be cheap either. But with financial connections of its new advisors in Asia, and other connections in Europe, Portofino should not have too much trouble raising the necessary capital. Portofino could therefore soon be facing a complete revaluation - especially if the bid for one or both Arizaro licenses is successful. But even just winning back the Yergo license represents a huge lift in value. The recent doubling in the share price could therefore only have been a first prelude.
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