Impact: Very Positive
Lake Resources has signed a non-binding Memorandum of Understanding (MOU) with Japanese trader, Hanwa Co. Ltd. (TYO:8078, Not Rated) for an offtake of 25ktpa LCE from its flagship, Kachi Li brine project in Argentina, amongst other terms. We view this potential offtake agreement for half of Kachi’s planned production very positively as it further de-risks the project and anticipate further offtake agreements in the works for most of the remaining 50%. With offtake negotiations in progress, funding in place for 70% of the capital costs, pilot plant construction underway and a recent increase to 50ktpa LCE production, we expect the upcoming DFS to demonstrate stellar economics for Kachi (Q2/22).