LONDON (Alliance News) - Ariana Resources PLC and Metal Tiger PLC plan to work together to identify opportunities focused on lithium and tantalum within the Malay Peninsula, and specifically within Thailand and Myanmar.
The pair have signed a memorandum of understanding to pursue potential opportunities to evaluate, explore and develop projects focused on the two commodities, which are largely used within the electronics industry.
Global attention on lithium in particular has been growing in recent years due to the anticipated surge in demand in the near and medium term as new markets for the commodity, such as electric cars, begin to come into play alongside further growth in other markets such as smartphones.
Any opportunities chased by the two AIM-listed companies will be split 50/50, with a formal joint venture structure being adopted once specific projects have been identified. Both companies will also have the right to assign or lower their interests in the joint venture to bring in other partners, they said.
Both companies currently have teams searching for potential projects, with Metal Tiger's existing joint venture partners in Thailand already identifying potential projects that may be suitable. Importantly, any licence applications will be submitted by Metal Tiger's existing joint venture partners in Thailand.
Metal Tiger had already said it was looking to expand its exploration and development interests in Thailand through its existing venture with South East Asia Mining, and although most of its focus has been on antimony, copper and gold to date, it has already said new opportunities are currently focused around lithium.
"The Metal Tiger Thai joint venture team have longstanding experience of working in Thailand and the team includes geologists with an understanding of the potential lithium-tantalum prospectivity in country. The work undertaken to date reviewing this prospectivity has highlighted numerous targets in respect of both in-situ mineralisation and tailings that may be processed further," said Paul Johnson, chief executive of Metal Tiger.
The two other AIM-listed companies that are really chasing the lithium market are Bacanora Minerals Ltd and Rare Earth Minerals Ltd, which are developing the Sonora lithium project in Mexico.
The pair have signed a major supply deal with US-electric car maker 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.
Other London-listed companies involved within the lithium market include Premier African Minerals PLC with its Zulu tantalum and lithium project, European Metals Holdings Ltd through its Cinovec project, and Alba Mineral Resources PLC, which is developing a graphite project in Greenland in the hope it can also benefit from its role as a key component in lithium-ion batteries.
Rare Earth also holds a 11.87% stake in the Cinovec project, through holding a stake in European Metals.
Ariana Resources also struck a deal back in December allowing the company to commercialise the Pilgangoora project in Western Australia, which contains lithium, by selling the project to another company because it is too early-stage and costly to develop in light of the current environment.
Ariana shares were trading flat at 1.08 pence per share on Tuesday afternoon whilst Metal Tiger shares were also trading flat at 1.20 pence.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
Copyright 2016 Alliance News Limited. All Rights Reserved.