Lithium junior has fast-track production potential

Q&A with Rodinia Lithium (V.RM) President & CEO William Randall

Can you describe your company and say what it does?

Rodinia Lithium (TSX: V.RM, Stock Forum) is a Canadian mineral exploration and development company with a primary focus on lithium exploration and development in North and South America. The company is also actively exploring the commercialization of a significant potash co-product that is recoverable through the lithium harvesting process.

What distinguishes your company from others in your space?

Rodinia Lithium is focused exclusively on production from lithium-rich salars in mining-friendly jurisdictions. This should allow for the rapid development of our assets – significantly less legal and development hurdles, and superior economics.

Can you explain why you have chosen to work in Argentina and Nevada?

We chose to work in Salta Province, Argentina and in Nevada, USA because our focus is mining-friendly jurisdictions. Salta is a pro-mining jurisdiction with over a century of mining activity, including producing operations from some of the world’s largest miners like Rio Tinto. Nevada is often times referred to as one of the most mining-friendly jurisdictions on the planet. Mineral exploration has occurred in Nevada for many centuries and is home to many junior, intermediate and senior developers.

Currently, a lot of attention is being placed on lithium and its potential role as a “strategic” mineral. Certain geographies take the view that lithium should be treated, in whole or in part, as a resource of the State. As a result, developers in these jurisdictions will have difficulties controlling the production process, timelines, and margins. Both Salta and Nevada have taken the traditional mining view and have not interfered with the lithium harvesting environment.

What are your flagship projects?

Our flagship project is the Salar de Diablillos lithium-brine project in Salta, Argentina. We control the productive nucleus of this Salar with no sharing concerns, which provides a potential to fast track to production. The Salar de Diablillos project contains an NI 43-101 recoverable inferred brine resource of 2.8 million tonnes lithium carbonate equivalent (“LCE”) based on an in-situ inferred brine resource of 4.0 million tonnes LCE. The project also contains a recoverable inferred brine resource of 11.2 million tonnes potassium chloride (“KCl”) based on an in-situ inferred brine resource of 19.8 million tonnes KCl. The Project is in close proximity to FMC’s Hombre Meurto, which is the third-largest lithium producer in the world. The key deliverables for 2011 are the Preliminary Economic Assessment and metallurgical test work.

In Nevada, we have our Clayton Valley Project, which we believe has the potential to be a second flagship project. Clayton Valley envelopes Chemetall Foote’s Silver Peak mine, which has been producing since the 1960s. This is the only known lithium-brine bearing valley in North America and is strategically located beside the second-largest producer globally and is in the heart of the North American automotive market.

Who are your competitors?

Generally, SQM, Chemetall Foote and FMC are the largest global lithium-brine producers. They account for the vast majority of the global lithium supply. Talison Lithium is a hard rock producer that is next in line with production.

Rodinia competes in the next tier with a handful of exploration and development companies to become the next producer. Some of our competitors include: Orocobre, Lithium Americas, Lithium One, Canada Lithium, Galaxy, and Nemaska.

Who are the major shareholders of Rodinia Lithium?

Apart from management and insiders, who account for approximately 25% of the outstanding shares, Rodinia’s most notable shareholder is Shanshan. Shanshan is China’s top user of lithium carbonate. It is also one of the world’s largest producers of materials used for the manufacturing of lithium- ion batteries. Shanshan currently owns approximately 7% of Rodinia.

How much cash do you have on hand and what is your monthly cash burn rate?

Currently, there is approximately $8 million in the bank. We believe this will easily carrying the business through the remainder of this year and into next.

Who are the key players on your management team?

Apart from me, our management team consists of Aaron Wolfe, a corporate finance and advisory professional who looks after our business development and capital markets needs. Prior to joining Rodinia, Aaron worked in investment banking. In addition, Raymond Spanjers, our Project Manager, has 29 years experience in industrial exploration, plant and mine management. He joined us from FMC Lithium division where he explored for lithium brine deposits in Nevada and the Andean Puna of Argentina. Finally, Bob Cinq-Mars is our Processing Consultant. Bob is a specialist in chemical process development, process design and management. Bob spent 20 years with FMC Lithium Division as Manager, New Resources and Process Development.

What kind of experience do they bring to the table?

Our management team brings widespread and relevant experience to Rodinia, which is described above. Furthermore, I am a Processional Geologist with extensive experience in mineral exploration and production, including lithium projects in South America. Previously, I worked with the Argentine government on prospective lithium assets. In addition, I have run and supervised numerous discoveries, and have taken deposits from the resource stage through to feasibility and into production.

It is important to note that there are additional individuals involved in Rodinia apart from our management team. Rodinia is supported by the Forbes & Manhattan team that has been instrumental in helping to develop and finance more than 50 projects in the past decade.

Disclosure: Rodinia Lithium is a Stockhouse client