The diverse and pragmatic nation that is the United States, for better and worse, was founded by pioneers migrating westward towards a vast and promising land full of natural resources. That’s no secret. These brave and relentless Americans, going as far as California, staked their claims and, in many cases, proceeded to drill for gold, oil (black gold) and other precious substances hidden below the Earth’s surface. In some respects, we’ve come an awfully long way since then and seem almost out of touch with that back-breaking self-made lifestyle. Now, every middle-class and upper-middle-class citizen is attached at the hip to a personal computing device, smartphone and/or tablet complete with its own lithium battery. On the other hand, we’re still an oil-addicted society, gold prices are higher than ever and, ironically, companies still have to drill into the ground to find that lithium as the demand rises and the price has tripled in the last decade. If we embrace hybrid and electric vehicles over fossil fuel cars, that probing of the Earth’s crust is bound to continue as lithium demand is expected to double by 2020, and industry revenues reach into the billions.
For years, industry giants Talison Lithium (TSE: TLH), FMC Corporation (NYSE: FMC), Sociedad Quimica y Minera (NYSE: SQM) and Chemetall controlled approximately 95 percent of the lithium market, which limited supply and maximized exclusivity. However, the recent purchase of Talison Lithium (TSE: TLH), the largest of all, for $732 million by Rockwood Holdings (Chemetall) has shaken things up. The transaction took the Canadian-listed company private at almost $6.60 per share – a 50 percent premium to its pre-offer trading price.
This purchase highlights and magnifies the value of lithium in today’s global economy, while potentially enhancing prospects for other lithium companies – especially junior exploration companies like AmeriLithium Corp. (OTCQB: AMEL). Meanwhile, large mining companies looking for lithium exposure are more likely to acquire late-stage exploration companies than pay a premium for one of the three producing giants.”
Therefore, AmeriLithium Corp., headquartered in Henderson, NV and trading at $0.0086 per share with a market cap of $1.48 million, stands to skyrocket as they continue to set up drilling operations for more than one of the world’s hottest subterranean treasures. In other words, not only is the company sitting on some of the most coveted lithium properties in the U.S., which has exponential potential if countries like China impose restrictions on exports like they do with rare earth metals, but now, AMEL is looking to start mining for gold in the ripe Katanning region of Western Australia .
Amerilithium has acquired more than 700,000 acres of exploration land including three in Australia, one in Alberta, Canada and four projects based in Nevada – near the only lithium producing plant on American soil. These holdings form one of the largest portfolios in North America, and the future is bright for AMEL. In July 2012, the company finished a geophysical study of their Australian holdings and targeted their drilling sites. In late August, the company announced the receipt of permits from the U.S. Bureau of Land Management to drill up to ten holes per property on both its Jackson Wash and Clayton Deep lithium projects in Nevada. Let the drilling begin.
In the short term, as gold prices peak, perhaps the search in Katanning is more immediately enticing than the seemingly long-term payoff of lithium mining. AMEL is joining the Australian gold rush at a very profitable juncture. Companies like Newmont Boddington Gold (NYSE: NEM) and Ausgold Limited (ASX: AUC.AX) have proven reserves of 20 million and 5 million ounces in Katanning respectively.
Better still, AMEL is currently in the final stages of securing the services of a new geologist and drill team. The company is also negotiating land access deals with land owners at a low price for each hole that’s drilled. The gold potential of the Katanning project tenements were evaluated by grid soils, regional tracking and trail soil sampling, and harvesting should conclude in late January of 2013 to allowing for initiation of the drill program.
All three of AMEL’s tenements are situated within the Katanning Greenstone Belt region – a veritable hotbed of gold anomalies. Further exploration via air-core drilling by Ausgold Limited (ASX: AUC) and others, including Amerilithium’s Australian holding company (South West Minerals), will likely extend this belt’s dimensions in all directions. In other words, AMEL has already staked its claim, so what’s next? Well, drill…baby…drill. For more information on this company and the lithium/gold industry markets, visit www.amerilithium.com/