Xantippe Resources Ltd (ASX:XTC, OTC:XTCPF), which is prospecting for lithium in Argentina’s Catamarca province along the prime lithium salar belt, has been given a “long” rating from Hallgarten and Company in initial coverage from the brokers.
The Carachi Pampa Lithium Project is in the Carachi Pampa basin, in the high-elevation Puna region of Catamarca province, northwestern Argentina.
Lithium-rich region
The project lies within the Lithium Triangle of South America, which encompasses parts of the basins and ranges throughout the Andean Puna Region of Argentina, Bolivia, and Chile, where closed basins have prompted the evolution of numerous lithium and potassium brine deposits.
The company has been busy accumulating land packages and has a total holding of eight tenements covering 21,900 hectares or 21.9 square kilometres.
In 2021, Xantippe acquired 100% of a West Australian company, Carolina Lithium, a privately held company 50%-owned by Arecco Ingeneria SA. Carolina Lithium, which has now rebranded to XTC Lithium, holds several lithium tenements in the most prospective area of Argentina.
In late June 2022, Xantippe inked a deal that makes Carolina Lithium the beneficial owner of Arlupo SA, a company registered in Argentina that holds the rights to the acquisition of the tenements under an agreement between a number of local tenement holders.
In making its initial call on Xantippe, Hallgarten and Company notes that:
- Xantippe’s Carachi Pampa Project shares a salar with the much-vaunted Lake Resources’ Kachi project;
- drilling in 2017-18 on the concessions now controlled by XTC displayed Lithium grades approximating those recorded by Lake Resources on its portion of the salar;
- Argentina has “come in from the cold” with investors as it has risen up the rankings to become the go-to place for new brine lithium developments;
- lithium prices have been the firmest aspect of the minerals’ universe in recent months as almost everything else has retreated in the face of weak equity markets and higher interest rates;
- Xantippe has attracted two of Argentina’s most prominent regional families as shareholders/directors; and
- the company had around A$6 million in cash on hand at the end of the June quarter.
The analysts had positive commentary about the state of the lithium industry to impart: “The strong attendance at the Lithium Forum in Buenos Aires in late July showed that global doomsters in the equity markets have left the lights in the marquee of the Battery Metals Boom undimmed.
“The event bordered on a feeding frenzy and the local politics raised nary an eyebrow for participants, which is more than one can say about Chile or Mexico these days.
“With Lithium in short supply, at least for now, the investment and development dollars are heading for the jurisdiction that provides most opportunities at the least degree of hassle. Perversely this is Argentina at the current time.”
The report went on to acknowledge that the investment environment in the South American country is not perfect, and the foreign exchange issues are a challenge, but said that the issues pale in comparison to other regional jurisdictions.
Many lithium developments in Argentina fail to connect locally, the report noted, but this was not a risk for Xantippe, which has worked alongside two local families of national economic prominence in accumulating and developing the project. The families have substantial shareholdings in XTC and board representation.