Standard Lithium Ltd. (“Standard Lithium” or the “Company”) (TSXV:SLL) (OTCQX:STLHF) (FRA:S5L) is pleased to announce that the Company has signed a non-binding Letter of Intent with a non-affiliated NYSE-listed company whereby, subject to the execution of a definitive agreement on terms acceptable to both parties (the “Definitive Agreement”) and obtaining necessary consents and permits, the Company will design, build and operate a continuous demonstration scale pilot plant (the “Pilot Plant”), adjacent to certain existing chemical production facilities located in southern Arkansas.
The Letter of Intent provides for a ninety-day period within which the Company and the other party will negotiate a Definitive Agreement in respect of the proposed Pilot Plant. Under the proposed Definitive Agreement, Standard Lithium would be permitted to build an in-place, continuously operating, pilot plant to explore and demonstrate a modern, selective extraction and purification process to produce battery-grade lithium products from a variety of brine streams, including tail brines from the Smackover Formation, which is one of the world’s largest brine deposits,.
In addition, Standard Lithium seeks to expand its lithium brine footprint through the evaluation of opportunities to obtain additional brine leases or sources located in southern Arkansas, which may allow for the transport and testing of multiple sources of Smackover brine in the Company’s proposed Pilot Plant.
Standard Lithium’s Chief Executive Officer, Mr. Robert Mintak commented, “The facilities in southern Arkansas where we may build the Pilot Plant are fed by a network of brine production wells in southern Arkansas that access underground brine from the Smackover Formation and transport it via an extensive system of pipelines and related infrastructure. Our relationship with this other party is expected to provide Standard Lithium with access to ‘tail’ brines to test for the viability of lithium extraction. In signing this letter of intent and negotiating quickly an agreement for pilot scale testing, Standard Lithium expects to de-risk and expedite the initial phases of resource assessment and project development while realizing significant reductions in both the capital and time associated with permitting and drilling test wells.”
President and Chief Operating Officer, Dr. Andy Robinson also commented, “When the definitive agreement with the other party is signed, it will allow us to move very quickly from the process testing work that we are currently performing at several locations, towards the design and fabrication of the continuous Pilot Plant. The location of the Pilot Plant could not be more favourable, as we will have direct access to the tail brine feed into the site, all necessary utilities, and the access to the services of an existing workforce of skilled and trained brine handling and processing technicians and engineers, all within an existing permitted and fenced brine processing site. This relationship aligns fully with Standard Lithium’s goal to demonstrate the efficient and effective use of modern processing techniques to produce battery-grade lithium products from large and previously overlooked brine resources”.
Proposed Transaction Terms
Pursuant to the terms of the Letter of Intent, completion of the Definitive Agreement will be subject to a number of conditions, including completion of satisfactory due diligence investigation in support of the feasibility of the Pilot Plant and obtaining all necessary consents and permits. In consideration for the right to conduct a due diligence investigation Standard Lithium has made a non-refundable deposit of US$100,000, and will make a further cash payment of US$100,000 upon signing of the Definitive Agreement. The Company will pay certain recurring fees if the Pilot Plant is constructed. No partnership is created by any of these agreements with the other party, and the other party has no obligation to fund any of the capital costs of the Company’s lithium-related activities.