Advantage Lithium (TSX-V: AAL) CEO David Sidoo on Acquisition of Orocobre Lithium Properties, Plans to Commence Aggressive Drilling Program at Cauchari
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is Advantage Lithium (TSX-V: AAL)(OTCL AVLIF) CEO, President, and Director, Mr. David Sidoo. David, thank you for joining me.
David Sidoo: Thank you, Gerardo, for having me on. I really appreciate being on here again.
Gerardo Del Real: Well, it's important for me to have you on. You had a pretty important update that you released yesterday, and the headline reads, "Advantage Closes Acquisition of Orocobre's Argentine Lithium Brine Properties." It's a big milestone for the company, and I think a potential catalyst for the rest of the year. Can you share the details, please?
David Sidoo: Sure. We closed our transaction with Orocobre on the 28th, and all the assets basically, it's the five assets, 100% owned, and the joint venture asset in Cauchari is now all officially with Advantage Lithium. The deal is done, the 20 million dollars moved over to our bank account yesterday, and we had our first budget meetings yesterday afternoon, and we're going to pursue an aggressive drill program starting April 17 at Cauchari.
Gerardo Del Real: Excellent, excellent. So can you provide a bit of background for new shareholders or potential new shareholders about Cauchari? Because it's obviously an exciting advanced stage property with a ton of upside exploration potential. It's a big target for the company.
David Sidoo: Yes, it's in a basin where Lithium Americas and SQM have drilled out a resource of just under 12 million tonnes. It's also in the same basin that our partner Orocobre has a six million tonne resource, and we sit right in the middle of this 18 million tonnes of resource that's been developed over the last six or seven years, drilling by both LAC and SQM and Orocobre, and we're going to start with a drill program here April the 17th. It's a tremendous basin for production. We've got 500,000 tonnes, just under 500 tonnes already inferred in Cauchari, in our basin that we own, joint ventured with Orocobre. Initially, it's a 50-50 joint venture, and when we spend $5 million US, we earn another 25%, and our budget calls for $5 million to be spent this year alone in Cauchari, so we will earn that 75%.
We have five rotary holes that we have permitted. We have the permits, and off those five rotary holes, we have an additional 12 diamond holes we can drill with success on the rotary holes. The rotary holes, Gerardo, will be drilled down to 450 meters, and the diamond holes will be 200 to 250 meters deep. So we're going to get at it immediately. We've engaged the exploration team of Orocobre full time. Now they're full time staff of Advantage Lithium. And Miguel Peral who put all the assets together in 2007, 2008 for Orocobre, incidentally, who are now producing 12 and a half thousand tonnes from Cauchari at their Olaroz facility.
Miguel Peral, he has joined our team as the head exploration manager full time, along with Callum Grant. Ross McElroy of Fission Energy continues to be a consultant, along with Doug Leishman and Murray Booker, who did all of the resource calculations and drilling targets for Orocobre has also joined our team. So we have a very strong team in Argentina that understands lithium, understands how to drill. We've engaged the same drilling contractor that drilled SQM and Lithium Americas' holes, and Orocobre's, so they're well-versed in the area. They understand it. They're the same contractor that's been very, very successful in that basin.
We're going to start having news flow starting at the beginning of first couple weeks, second week of April. We'll probably have two or three press releases, news flow happening right through April to the end of the year. We're hoping by the end of just before Christmas, that we're halfway through or three-quarters of the way through of pre-feasibility study, and be able to tell the market what kind of resource we have there.
Gerardo Del Real: Excellent. Excellent. Now you mentioned the $20 million that just hit the bank. Can you provide us an update on the cash position for Advantage?
David Sidoo: With that additional funds, we have $23 million Canadian in the bank right now. We don't need to fund now with Advantage for the next three, three and a half years based on the work program that we have in place. If we do require any more funds, we have a warrant package that was built into the last financing that will give us approximately, let me just see here really quickly. It was about 13 and a half million warrants that we had placed into the whole deal as well. They were at $0.75, so that's another 10 million dollars if we need to fund the company in any other future expansion we do. We've got more money than we need at this point, so we don't need to go to the market for funding, which is very significant.
Gerardo Del Real: Absolutely. David, I want to thank you again for your time. Anything that you'd like to add?
David Sidoo: No, I just want to let everybody know that we will keep everyone up-to-date. It will be a strong, steady news flow. I'm very confident in the team that we have down in Jujuy and Catamarca. We've got the funds now. We've got some great assets and a good team, and I think we'll be off to the races here. You guys will be hearing a lot from us in the next several months.
Gerardo Del Real: Looking forward to it, David. Thank you very much.
David Sidoo: Thanks, buddy. Take care.