Home / NRG Metals Inc CEO Adrian Hobkirk on the “Paleo” Lithium Salar in Argentina

NRG Metals Inc CEO Adrian Hobkirk on the “Paleo” Lithium Salar in Argentina

NRG Metals Inc (CVE:NGZ)(OTCMKTS:GPOFF)(FRA:OGPN) CEO Adrian Hobkirk has put together an impressive team and land package in Argentina that will explore the Carachi Pampa Lithium Project in Catamarca, Argentina. Carachi Pampa is a 29,000 hectare “paleo” solar – meaning one which is buried under overburden, and with no surface expression.


James West:    Adrian, thanks for joining us today.

Adrian Hobkirk: Nice to be with you today, James.

James West:    Adrian, let’s start with an overview: what is the value proposition for investors in NRG Metals?

Adrian Hobkirk: Well, at NRG we’ve combined an exceptionally experienced lithium team and an exceptional exploration project in Argentina with a focus to drill up Argentina’s next lithium discovery.

James West:    Okay. So you’ve chosen a paleo lithium salar, which differs from the traditional salar. What is the difference, and why did you choose that route?

Adrian Hobkirk: Sure. Our team that we put together had experience in this particular area, and they had a geological concept for the area of interest. In a traditional salar, you’ll see exposure at surface, you know, a lot of investors have seen those nice pretty blue lakes with the flamingos flying and birds landing on the water; this is different. This is a formerly beautiful blue lake that has been covered by a diatomaceous soil top. What I mean by that is, over the millennial, due to erosion, the top of the salar has been covered over. So when you stand on it, it really looks like just a rock desert, there’s nothing visible there. You can’t take samples, because there’s none of the brine exposed to the surface.

But the concept was that farther down, there would be a brine zone. And our geological team had an exploration plan for this, which we executed recently. We’ve completed a 43-101 technical report on the project, and we identified by VES, that’s Vertical Electrical Sounding, a brine zone, what we interpret to be a brine zone, of course, farther down in the lower levels of this particular basin, which would be indicative of a very paleo salar.

James West:    Okay. So you’ve managed to take control of almost the entire Carachi Pampa salar. What advantages does that give you?

Adrian Hobkirk: It gives us a lot of advantages. Firstly, trying to get five different groups to agree to do something in Argentina takes a lot of talent, and I must give our team full credit for getting everybody to agree to join the NRG team.

We have five different private vendors that combined, represent 29,000 hectares of this particular paleo basin, and in that respect, what we can do by controlling this area is keep other people out of the basin. So unlike other areas in Argentina where there’s many different players in one particular salar, this is pretty much going to be us.

James West:    Interesting. Speaking about your management team, you’ve got some resumes there, and some names, that are very well known in the lithium space in South America. How did you manage to attract these guys, and why did they join your startup?

Adrian Hobkirk: Sure. A year ago, my associate in the company, Allen Ambrose, who’s the founder of Minera Andes that was bought by McEwen Mining for the mine that he developed in Argentina, said, why don’t we look at Argentina for lithium? He introduced me to his former Chief Operating Officer, James Duff, and Jim and I went down to Argentina and said we can start with a salar, we can start with property over here; let’s start with a management team. And Jim went through his Rolodex and said let’s talk to this guy, this guy, this guy. We interviewed people and we assembled a team that could represent everything from exploration right to the development of the project and the production of lithium.

James West:    Right. Okay. So especially your head of Argentina, Jose de Castro, his name is very familiar. What was his most recent professional incarnation?

Adrian Hobkirk: Jose managed the Orocobre in Argentina for many years, and did exploration on pretty much every salar that everybody’s looking at today. Any of the main salars, his resume is probably highlighted with the development of the Olaroz salar to production for Orocobre. That’s the most recent brine deposit in the world to be put into production; he headed it.

James West:    That’s interesting. Okay, so then, what is your development plan for the next 12-24 months?

Adrian Hobkirk: Well, our guys are working in the field as we speak. We have filed our environmental assessment report for Carachi Pampa; we would propose a two to four-hole drill program to test the conductive zone that we’ve identified. We have a crew in the field looking at other properties as well; we’d like to add other salars to the property package.

James West:    Okay. How much capital do you foresee needing to raise to get to a feasibility study, or is it kind of too early to say?

Adrian Hobkirk: It’s too early to say, but that being put on the table, right now we’re funded to explore and confirm our geologic expectations at Carachi Pampa. We’re also funded to make another acquisition. Either projects moving along with a larger database, I think we’d find it pretty easy to fund further exploration.

James West:    Right. Okay, and from a macro perspective, how do you see lithium supply and demand metrics playing out from your position?

Adrian Hobkirk: There’s a lot of information out there for people to digest on where lithium is going. I think you only need to take a look around and see the number of electric vehicles and the new uses for lithium ion batteries that are being developed, to probably come to the conclusion that I have, which is the demand should remain very strong in the coming years. You know, we have an energy revolution going on, and lithium ion batteries are playing a key part in that.

James West:    Right. Are you planning to be a – well actually, you’ve already answered that; you’re not planning to be a single project company, you’ve got more acquisitions on the horizon. Are you looking at additional paleo lithiums, or traditional lithium?

Adrian Hobkirk: We actually are looking at another paleo salar. We are looking at a couple of traditional opportunities as well. We’ve got a great field crew, and they’re not working at Carachi Pampa right now; as I mentioned, we’re waiting for our permitting to be completed, so they’re out in the field looking for other opportunities. I’m sure on the horizon we’ll have something shortly.

James West:    Okay. What are some of the advantages to you being in Catamarca province as opposed to Jujuy or Salta or even Chile?

Adrian Hobkirk: Well, Chile, as you know, they have their own rulings on the production and exportation of lithium. Argentina doesn’t. You can be a foreign company and produce and sell lithium. That’s probably the biggest advantage over Chile.

In terms of Catamarca, there’s great infrastructure in this particular province. The province is very easy to talk to. Members of the administrative are great to work with. So we find a mining-friendly environment in Catamarca.

James West:    I see. And do you foresee any local opposition towards the development of the Carachi Pampa over time from locals?

Adrian Hobkirk: That’s a great question, and it’s a question that everyone in this industry can answer. When we go to a foreign country and you’re looking to develop a mining project, you’ve got to have great community relations.

We have two Joses in the company: Jose de Castro and we have Jose Luis Martin. Jose Luis is based in Catamarca, and he was actually responsible for being the developer of the Sal de Vida project for Galaxy Resources. He ran their community relations and their exploration. That’s a major lithium discovery to our north. So we have Jose on it 24/7 with good community relations, communicating locally to the people what our objectives are and how it could possibly affect them. So I think that that’s a key point. You have to communicate with the local people, and you have to be open about what you’re doing.

James West:    Mm-hmm. So then, how aggressive are you planning to be on your exploration, and when do you think you’ll be in a position to start reporting results from, say, drilling?

Adrian Hobkirk: Well, this will be a pretty easy drill. I would think we could get our first hole done in a couple, three weeks. There’s laboratory services obviously in Argentina that are exceptional, and they’re quick. So I would think our first exploration task at this would be about six weeks, and probably three weeks into the exploration phase, we should start to see results from our first hole.

James West:    Okay. So what about obtaining drills and drillers down there? Is that going to be a challenge?

Adrian Hobkirk: It’s competitive, there’s no doubt about it. I was recently in Salta with Jim; we interviewed four different drillers, we put this out to tender in advance, and what we’re really looking for is one group to give us one price so that they come in and they drill it for a set amount and, you know, if things get delayed, if things don’t work as they had planned, they make them work, but we don’t pay more for it.

So I think that service is out there. As I said, we interviewed four groups; we’ve really settled down to one. I don’t believe we’re going to have an issue getting a rig on the property.

James West:    Right. Okay, and finally, just quickly touch on the infrastructure in the area. What have you got in terms of roads, highways, power, water, etcetera?

Adrian Hobkirk: Sure. There is a road across the salar, and there’s a city nearby. Yeah, it’s good infrastructure. Sierra de Antofagasta is a city of not a huge number of people, several thousand, but it can provide support services and it’s located about 25 miles north of the property. That would be the largest city. There’s another small village locally where you can get things that you need, and get your supplies. So to set up shop and drill the property should be pretty straightforward. We can base our crew in the local city and they can just commute on a daily basis to run the rig.

James West:    Okay, Adrian, that’s a great initial overview. We’re going to come back to you in a short period of time here and see how exploration is going. Thank you very much for your time today.

Adrian Hobkirk: I appreciate it, and we look forward to some exciting news from Argentina.

Disclosure: James West owns shares in NRG Metals Inc., and also receives funding from the company for the production of written, audio and visual media. The reader/viewer/listener should assume that James West and/or Midas Letter Media Corp stand to benefit financially from a rise in the share price of NRG Metals as a result of these content iterations. We reserve the right to sell and/or purchase additional securities without further notice.