LONDON (Alliance News) - Bacanora Minerals Ltd Wednesday said its pretax loss widened in the last financial year as it continues to progress its Sonora lithium project as fast as it can in order to retain its landmark deal with Tesla.
The miner reported a USD2.8 million pretax loss in the year ended June 30, widening from the USD2.0 million loss a year earlier. The company said revenue totalled USD108,403 in the year, compared to USD10,710 a year ago.
The loss widened after administrative expenses rose to USD2.8 million from USD1.1 million, depreciation increased to USD287,527 from USD135,819. It also lost out on a USD1.2 million impairment gain that wasn't repeated from last year.
"We continue to progress the pre-feasibility study for the Sonora lithium project, which is due to be completed in calendar first quarter of 2016. Bacanora continues its strategy towards becoming a supplier in the rapidly growing lithium market," said Chief Executive Peter Secker.
Once it has finished the pre-feasibility study, it plans to "immediately embark" on a bankable feasibility study to allow it to source finance for the project, whilst it holds talks with potential offtake partners, it said.
The Sonora project is a joint venture with fellow London-listed stock Rare Earth Minerals PLC. Rare Earth also holds a 17% stake in Bacanora at a corporate level after steadily increasing its stake in Bacanora throughout 2015.
Importantly, the Sonora project got a major boost when the pair signed a landmark deal with US-giant Tesla to supply lithium for Tesla's huge Gigafactory in Nevada, where it aims to produce hundreds of thousands of electric vehicles per year which will send demand for lithium skyrocketing before early 2020s.
In September, the pair sped up its drilling programme on the project as it races to meet Tesla's schedule over the next few years in order to retain the deal. The project is aiming to produce around 50,000 tonnes of lithium per year, which will only represent a fraction of the global demand by the time it is up and running.
Currently, the pair are completing a mineral resource estimate for the Fleur and El Sauz concessions at the project since finishing that drilling programme in September.
Bacanora shares were trading down 3.9% to 85.55 pence per share on Wednesday morning whilst Rare Earth shares were down 1.9% to 0.908 pence.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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