Path clear for Arizona Lithium to start drilling at Big Sandy

Arizona Lithium has been given the go ahead by the US Bureau of Land Management to start exploration drilling.

Arizona Lithium can now speed towards lithium drilling at Big Sandy in late July. Pic: Getty Images

• Arizona Lithium secures BLM approval for its Big Sandy lithium exploration plan

• No appeals have been received for its permit of exploration, which covers up to 131 exploration holes

• Drilling expected to start late July to test exploration target

Special Report: Arizona Lithium has been given the go ahead by the US Bureau of Land Management to start exploration drilling at its Big Sandy lithium project.

It follows the BLM awarding the company the permit of exploration in June, which allows it to drill up to 131 exploration holes and collect bulk samples.

Big Sandy hosts a very shallow, flat-lying, mineralised, sedimentary indicated and inferred lithium resource of 32.5Mt grading 1850ppm lithium for 320,800t lithium carbonate equivalent.

With this resource covering just 4% of the project area, there is plenty of ground for Arizona Lithium (ASX:AZL) to find more – a point reinforced by the exploration target of 271.1Mt-483.2Mt with a grade range of 1000 parts per million to over 2000ppm lithium.

Big Sandy mineralisation is already proven to be amendable for processing into lithium carbonate, with metallurgical testing having produced a product with 99.8% purity.

That meets the specifications sought by major international battery manufacturers.

The project is close to the major cities of Phoenix and Las Vegas. It is also 960km by sealed interstate highway from Tesla’s Gigafactory in Nevada.

Drilling green light

The receipt of approval for the exploration plan and the lack of any appeals for the permit of exploration means that AZL is now clear to start drilling at Big Sandy.

Drilling is expected to begin in late July and will be managed by the Navajo Transitional Energy Company – the third largest coal producer in the US – under their Mining Services Agreement.

This program seeks to expand the existing indicated and inferred resource by testing the validity of the exploration target.

“We are very pleased to obtain drilling approval from the BLM for the Big Sandy project. Plans are well advanced to commence drilling later in July and the taking of a bulk sample of Big Sandy ore for processing at the Lithium Research Centre in Tempe, Arizona,” managing director Paul Lloyd said.

“This is a very exciting step for the company and I would like to thank all the AZL team for their professional determination demonstrated throughout the process and the thorough and respectful engagement of all stakeholders.”

America is set to become one of the world’s largest lithium-ion battery and electric vehicle markets, with one of the largest auto manufacturing sectors in the world.

But it produces precious little of its own lithium – currently sourced from a single Albemarle asset.

With tax incentives provided under the Inflation Reduction Act to produce EVs made with locally sourced material, future US lithium carbonate producers could head up the queue as a supply source when local or FTA-aligned material sourcing clauses ramp up in the next couple years.

This article was developed in collaboration with Arizona Lithium, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

Originally published as Path clear for Arizona Lithium to start drilling at Big Sandy