Pursuit’s Argentine lithium project clears a major development threshold
Pursuit Minerals posted an A$666,579 FY2026 profit, but the result was driven largely by a fair-value gain on its Kendrick Resources investment rather than operating revenue. The company’s more consequential development is in Argentina, where Rio Grande Sur now carries a 1.264 million tonne LCE resource, a maiden probable reserve and a pre-feasibility case for 5,000 tonnes per year of lithium carbonate.
- A$666,579 FY2026 profit versus A$10.38 million loss
- US$364 million post-tax Rio Grande Sur NPV
- 1.264Mt LCE resource and 125kt probable reserve
- 99.5% lithium carbonate pilot-plant purity
- A$3.11 million cash and material funding uncertainty
Fair-value gain drives return to profit
Pursuit Minerals Limited (ASX:PUR) returned to profit in FY2026, but the headline number needs a little unpacking. Net profit was A$666,579, compared with a A$10.38 million loss a year earlier, after the company recorded a A$4.62 million fair-value gain on its investment in Kendrick Resources Plc. That investment was worth A$4.84 million at 30 June 2026.
Pursuit remains an exploration and development company without revenue-producing operations. It spent A$2.09 million on operating activities and A$5.82 million on investing activities during the year, including A$5.81 million on exploration and evaluation assets. Administrative costs rose to A$2.26 million, while share-based payment expense reached A$1.47 million. The accounting profit is therefore not a proxy for commercial lithium cash flow.
Rio Grande Sur reaches pre-feasibility stage
The strategic centrepiece is Rio Grande Sur in Argentina’s Salta province. Pursuit’s pre-feasibility study outlines a conventional salar-brine project producing 5,000 tonnes per year of lithium carbonate over a 25-year mine life. The study estimates a post-tax NPV of about US$364 million, an IRR of roughly 22% and initial capital expenditure of approximately US$136.5 million, with operating costs estimated at about US$6,520 per tonne of lithium carbonate.
The study is supported by an updated JORC 2012 mineral resource of 1.264 million tonnes of lithium carbonate equivalent at an average grade of 424 milligrams per litre of lithium. That total comprises 705,000 tonnes in the Indicated category and 559,000 tonnes Inferred. A maiden Probable Ore Reserve of approximately 125,000 tonnes LCE has been converted from the Indicated resource using a 360mg/L cut-off grade and assumed 57% processing efficiency.
The reserve is materially smaller than the resource, as expected, because it represents only the economically mineable portion scheduled in the 25-year study. The report also stresses that mineral resources are not mineral reserves and have not demonstrated economic viability. Pursuit is preparing addendums assessing larger lithium carbonate and alternative lithium chloride cases, while ongoing drilling and resource work could test whether the project extends beyond its current model.
Pilot plant supports processing case
Technical work has produced lithium carbonate at 99.5% purity after optimisation using fractional crystallisation and ion exchange, up from an initial 98.9%. Pursuit says the pilot work is informing its flowsheet and plans to continue small-batch production while progressing the pilot plant towards Rio Grande Sur brine and larger-scale testing.
The company is also advancing the Sascha Marcelina gold project in Santa Cruz, where it has identified five principal exploration targets. Historical drilling at Sascha Northwest returned intercepts including 0.27 metres at 10.74 grams per tonne gold and 1.55 metres at 8.92 grams per tonne, while Marcelina has historical intercepts of 0.9 metres at 5.48 grams per tonne gold equivalent and 0.9 metres at 4.17 grams per tonne. These are exploration results, not a defined resource or reserve, but they form the basis for planned deeper testing of the interpreted epithermal system.
Cash position remains the immediate constraint
Pursuit ended the year with A$3.11 million in cash, up from A$557,118, after receiving A$11.11 million from share issues and convertible notes. Its exploration and evaluation assets rose to A$49.76 million, partly reflecting the acquisition of the Sascha Marcelina project and further Rio Grande Sur expenditure. The balance sheet carried only A$589,359 in total liabilities, but that does not remove the financing challenge attached to building a US$136.5 million project.
Directors explicitly disclosed a material uncertainty over going concern: additional funding is required to meet ongoing exploration commitments and working capital needs. They said they were confident of raising capital and managing discretionary spending, while acknowledging that failure to secure further funds could affect the company’s ability to continue as a going concern. The next test is therefore less about whether Rio Grande Sur looks attractive on paper than whether Pursuit can fund the work needed to turn that paper case into a financeable development.
Bottom Line?
Rio Grande Sur now has the headline economics and a reserve, but Pursuit’s A$3.11 million cash balance is modest beside the capital required to advance the project.
Questions in the middle?
- How will Pursuit fund the US$136.5 million initial capital requirement without materially diluting shareholders?
- Will the expanded lithium carbonate and lithium chloride studies improve the project’s financing and commercialisation options?
- Can upcoming drilling at Rio Grande Sur and Sascha Marcelina convert strong exploration signals into larger, economic inventories?
