Lithium Ionic Corp. (LTH:TSX.V; LTHCF:OTCQX; H3N:FSE) announced results of four holes from the ongoing drill program at its Bandeira project in Brazil, and among them was the thickest intercept encountered there so far, reported Desjardins Securities analyst Frederic Tremblay in an Oct. 8 research note.
"We view today's update positively as it reinforces the key reasons why we like Lithium Ionic," Tremblay wrote. They are the quality of the project, quick path to production, low costs, proximity to producers and infrastructure, and resource growth potential.
321% return potential
The analyst reiterated Desjardins' CA$3.75 per share price target on the Toronto, Ontario-based lithium explorer, currently trading at about CA$0.89 per share. The difference between these prices reflects a potential return for investors of 321%.
Lithium Ionic remains a Buy.
Thickest intercept returned
Tremblay reported and discussed the results of four Bandeira drill holes: ITDD-24-264, -265, -266 and -276. An intercept from hole ITDD-24-276 is the thickest intercept encountered via drilling thus far at Bandeira. Its grade is in line with the 1.35% grade of the existing mineral resource estimate. This highlight intercept is:
- 64.7m of 1.39% lithium dioxide (Li2O), including 22m of 1.67% Li2O and 20m of 1.62% Li2O
Other intercepts returned in this batch of results include:
- 7.03m of 0.9% Li2O, including 1.77m of 1.95% Li2O, from hole ITDD-24-264
- 13.06m of 1.11% Li2O, including 5m of 1.51% Li2O and 9.72m of 1.28% Li2O, including 6m of 1.54% Li2O, from hole ITDD-24-266
On the horizon
Tremblay pointed out two upcoming catalysts for Lithium Ionic. One is the remaining drill results from Bandeira, for holes ITDD-24-267 through -275.
The other is receipt of the Licença Ambiental Concomitante, or LAC, expected by year-end. This environmental license will allow Lithium Ionic to begin construction at the project.
"In the meantime, [the company] is actively working on progressing the Bandeira project to the execution phase, including optimizing the project design to reduce capital and operating costs," Tremblay wrote.
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