Power Minerals Clarifies Rincon Lithium JV Resources, Retracts PEA Forecasts Ahead of $4M Investment
Power Minerals Limited has amended its Rincon Lithium Project Joint Venture announcement to clarify mineral resource categories and assumptions, retracting financial forecasts to avoid investor confusion. The Rincon JV incorporation is imminent, unlocking a $4 million investment to advance lithium brine development.
- Clarification of mineral resource categories and grades for Rincon Project
- Retraction of Preliminary Economic Assessment financial forecasts to prevent misleading investors
- Imminent incorporation of Rincon JV project company in Argentina
- Navigate Energy’s US$4 million investment to fund pilot plant and project development
- Transfer of Pocitos Project to Rincon JV to secure freshwater and infrastructure access
Context and Correction
Power Minerals Limited has issued an amended announcement regarding its Rincon Lithium Project Joint Venture (JV) in Argentina’s Salta province. The company clarified key details about the mineral resource categories underpinning its Preliminary Economic Assessment (PEA), including updated tonnage and lithium grades. Importantly, Power Minerals retracted the financial forecasts previously published in the PEA to ensure investors are not misled by potentially premature or overly optimistic projections.
This move reflects a cautious approach to investor communications, emphasizing transparency and compliance with regulatory standards. The retraction does not negate the underlying resource potential but signals that further evaluation is required before financial outcomes can be reliably forecasted.
Advancing the Rincon Lithium Joint Venture
The Rincon JV, formed between Power Minerals and Navigate Energy Technology Limited, is on the cusp of formal incorporation under Argentinian law. This milestone will enable the transfer of the Rincon Lithium Project tenure into the JV entity and trigger Navigate Energy’s committed US$4 million investment. These funds are earmarked to develop a lithium brine pilot plant, which will test brine qualities and optimize Direct Lithium Extraction (DLE) technology tailored to the project’s unique characteristics.
The pilot plant is a critical step in de-risking the project and refining processing techniques to maximize lithium recovery. The JV structure also facilitates streamlined decision-making and capital deployment, overseen by a management committee to ensure alignment with project goals and regulatory approvals.
Resource and Infrastructure Highlights
The Rincon Project boasts a JORC-compliant Mineral Resource of approximately 292,564 tonnes of lithium carbonate equivalent (LCE), split between Measured and Indicated categories (156,131 tonnes) and Inferred resources (135,433 tonnes). While the Inferred category carries lower geological confidence, the overall resource base positions Rincon as a significant lithium brine asset within the prolific Lithium Triangle.
Complementing Rincon is the Pocitos Project, which will be transferred into the JV entity. Pocitos offers vital infrastructure advantages, including access to freshwater; a crucial input for lithium brine processing; as well as rail links to Pacific and Atlantic ports and power supply. This integration is expected to enhance operational efficiencies and economies of scale for the JV.
Looking Ahead
Power Minerals’ Managing Director, Mena Habib, underscored the importance of completing the JV incorporation and asset transfers as foundational steps toward unlocking shareholder value. The company remains committed to advancing the Rincon Project through pilot testing and early-stage development, while maintaining transparency on the assumptions and risks involved.
Investors should note that while the PEA indicated robust potential with a pre-tax net present value exceeding US$500 million and a strong internal rate of return, these figures have been retracted pending further validation. The company continues to emphasize that production targets are subject to change and contingent on future exploration and studies.
Bottom Line?
As Power Minerals finalizes the Rincon JV incorporation and navigates early development, investors await clearer economic signals amid cautious resource reassessments.
Questions in the middle?
- When will updated financial forecasts for the Rincon Project be released following the PEA retraction?
- How will the pilot plant results influence the timeline and scale of lithium production at Rincon?
- What are the implications of the low confidence in Inferred Resources for the project’s long-term viability?
