Drilling the first holes into a lithium prospective basin is a high risk business, because if you miss, or the lithium grades are low, the market tends to punish the company vigorously by selling hard as investors turn their back on the stock and move on to their next gambling frenzy.
On the other hand, this could create an outstanding buying opportunity for those that still believe in the company and know that – in most cases – it’s never the first hole that makes a discovery.
This could very well be true for Belmont Resources Inc. and its Kibby Basin Project in Nevada, 65 km north of the famous Clayton Valley.
In June of this year, the lithium explorer reported assays from its first 2 holes, showing up to 200 ppm lithium in sediments. This was a promising discovery as it made official that there is lithium in the Kibby Basin. However, investors – at that time – were not looking for “promising” results in sediments, they wanted to see high-grade lithium in aquifers as that’s also the pay zone in the near-by Clayton Valley.
So as they did not get what they wanted to see, the stock took a dive at 5 cents and reached a bottom 4 months later at 2.5 cents.
After a recent financing at 3 cents for the next round of exploration, the stock currently trades at 5 cents again. With management and insiders taking the lion’s share of that financing, this may give confidence that they still believe to hit it big time with the next round of drilling.
And today, Belmont made a striking announcement that could be the missing piece of puzzle for the question of where to drill the next couple of holes on its large property to finally discover high grades of lithium in the aquifer pay zone.
When you have a 27 square kilometer big property, where basically no one ever conducted any modern exploration to find lithium-bearing aquifers, you need to start somewhere to prove your case that there could be lithium.
So Belmont looked at the Clayton Valley and compared it to the Kibby Basin, and they found a geologic setting similar to the continental brine model ascribed to the Clayton Valley. Then they did a 3D gravity survey over the entire property and found that it has the structure of a perfect lithium basin.
This was followed by 2 “scout-holes“ to find out if there is any lithium in those sediments and to get a first look of the basin‘s geology. Drilling found promising lithium values (up to 200 ppm) in sediments which is a great indication that a near-by aquifer may host much higher grades. With 13 of 25 core samples assaying over 100 ppm lthium, these sediments could very well be a potential source of lithium for the underlying aquifers.
The question then arose where to drill next in order to find the aquifer, respectively the pay zone. A consultant to Belmont, took a deep dive into researching the Kibby Basin and made some striking findings, with the results you can see in today‘s news release.
Originally, he just wanted to put the company‘s property borders on a map, so he looked at some satellite images and started to think outside the box. He obtained more satellite data sets as he had the feeling he was onto something.
Belmont‘s consultant then contacted the USGS and NASA to confirm his theory and soon it became clear that he found the missing puzzle piece. As the images indicate, he may have found the location of the geothermal system – right in the heart of the Kibby Basin. This looks like a big “discovery“ as there is no surface expression of a geothermal system and until now it was not even clear if at all there is a geothermal system on the property.
The above is an animation (click here) showing 8 days of a snow storm in 2016 above the Kibby Basin: Note the snow in red and that over 1 foot of snow was all gone within short time (so the take-away is the Kibby Playa is warm due to a geothermal system).
To make it clear: A geothermal system is the key for a lithium-bearing aquifer and as such the location of the lithium aquifer is likely to be at the same spot.
As Belmont has now found this 1 square kilometer area on its property, where a convergence of anomalies occur, the company is now getting ready to drill into this area to find the lithium-bearing aquifer. Vojtech Agyagos, CEO & President of Belmont, explained today:
“The discovery of this area of hydrothermal indicator minerals representing approximately (1) square/Kilometer of our 27 square kilometer Kibby Basin, Nevada property will become the center of our continued exploration. This area hosted the highest Lithium surface samples as well and is the site of our proposed third drill hole. Our 2017 drill program discovered both water (FRESH) and up to 200ppm lithium in the core in the Eastern side of the property about 2 kilometers from these Thermal alterations. This geothermal alteration sits above the deepest gravity indicated area from Belmonts’ 2016 Wright Geophysical ground gravity survey.
Belmont, is presently seeking quotes from geophysical engineering companies for Magnetotelluric (MT), Vertical Electrical Sounding (VES) and Geothermal Probe surveys with a view to isolate the most prospective area to drill for geothermal brine water. This new information will be used, along with the planned electromagnetic resistivity (‘EM’) and possibly seismic survey of the property to pin point the higher aquifer probability targets for the next phase of drilling. The electromagnetic resistivity (‘EM’) survey is expected to be completed early in January 2018.”
Full version / Belmont has been reviewing EOSDIS NASA Worldview and the United States Geological Survey (USGS) archived satellite data (1996 -2017) acquired over the Company’s Kibby Basin - Lithium brine exploration project. Archived ASTER/Landsat satellite data collected over the Monte Cristo Valley has identified significant anomalous higher than normal concentrations of clay-mica-hydrous silica-ferric iron minerals in the north-central playa in nearly the same area as indicated by the ASTER data within the Belmont, Kibby Basin – claim area. ASTER/Landsat class satellite data have been most effective at broadly categorizing surface units that can be considered as proxy for geothermal systems (e.g., sulfates, carbonates, clays) than identifying specific minerals and their mixing components (Taranik, 1988, Sabine et al., 1994, Rowanet al., 2005 and Zhanget al., 2007).
Full version / Principals and applications of indirect methods which involve using hydrothermal minerals as a proxy of geothermal systems were discussed by Hunt, 1977; Clark, 1999; Greenet al., 1998; Martini et al., 2004 and Vaughan et al., 2003 and 2005; whereas the direct thermal indices and associated applied methods were discussed in Mongillio, 1994, Hackwell et al., 1996; Haselwimmer et al., 2011; Rowan et al., 2003; Coolbaugh et al., 2007. Well-established methods in multispectral, hyperspectral analysis, in conjunction with modern subsurface geophysics, advanced imagery from space-based and airborne sensor systems, permits their direct and immediate application in geothermal energy prospecting and their evaluation using both thermal signature, and spectral signatures indices (Coolbaugh et al., 2007; Gupta and Roy 2007) (Prospecting for geothermal energy through satellite based thermal data)
The circled areas in both the shown images are basically parts where hydrothermally altered sediments occur on the playa of the Kibby Basin. The presence of these indicate that, at one time, the hydrothermal water reached the surface (probably in form of a geyser or hot spring). Also, they indicate the proximity of faults and fissures. With the first 2 holes, Belmont tried to drill into some indicated (ground survey) faults on the eastern side of its property.
Now with this new information (hydrothermal alteration), they may have found the missing piece of the puzzle to start drilling into the right spot of the basin to finally make a striking discovery (i.e. drilling into a lithium-rich aquifer).
The USGS wrote a report in 2013 outlining what you would need to find a lithium brine deposit – all producing lithium brine deposits share a number of first-order characteristics:
(1) arid climate;
(2) closed basin containing a playa or salar;
(3) tectonically driven subsidence;
(4) associated igneous or geothermal activity;
(5) suitable lithium source-rocks;
(6) one or more adequate aquifers; and
(7) sufficient time to concentrate a brine
With the upcoming geo probing and MT/VES survey – and the latest knowledge acquired from satellite data – Belmont is on track to find (6) one or more adequate aquifers.
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Shares Issued & Outstanding: 51,160,953
Canadian Symbol (TSX.V): BEA
Current Price: $0.05 CAD (12/13/2017)
Market Capitalization: $2.6 Million CAD
German Symbol / WKN (Frankfurt): L3L1 / A1JNZE
Current Price: €0.027 EUR (12/13/2017)
Market Capitalization: €1.4 Million EUR
Report #6: “Belmont on track to eclipse the Clayton Valley”
Report #5: “Belmont getting ready to drill for untapped lithium brines at Kibby Basin in Nevada”
Report #4: “The perfect lithium basin?”
Report #3: “Prominent gravity low identified on Kibby Basin Lithium Brine Property in Nevada”
Report #2: “Dark clouds over Clayton Valley and green lights for Belmonts Kibby Basin Project”
Report #1: “Early Report on Belmont Resources”
Disclaimer: Please read the full disclaimer within the full research report as a PDF (here) as fundamental risks and conflicts of interest exist.
Disclosure: I am/we are long TSX.V:BEA.