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March 28, 2024

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Grid Metals (GRDM.V) signs pre-production agreement with Tanco Lithium Mine

Grid Metals Corp. (GRDM.V) today announced that they entered into a Memorandum of Understanding (Agreement) with Tantalum Mining Corporation of Canada Limited (“Tanco”) for the forthcoming metallurgical tests on lithium spodumene ore from Grid’s Donner Lake Lithium Property at the Tanco Mine located at Bernic Lake in southeastern Manitoba.

Currently, Tanco Mine is the only North American based producer of lithium spodumene concentrate. The Donner Lake Lithium Project is a 75%/25% joint venture between Grid Metals and Lithium Royalty Corp.

What exactly is lithium spodumene concentrate? Spodumene is an important lithium mineral that is used in the production of ceramics, enamel and glass. It is a high-purity lithium ore with approximately 6% lithium content being produced as raw material for production in lithium-ion batteries.

Under this signed agreement, Grid Metals will supply samples from Donner Lake to Tanco for metallurgical testing at the Tanco Mine to test their amenability to produce a quality lithium spodumene product. After successful initial test work and obtaining an Advanced Exploration Permit, Grid metals will submit a bulk sample to Tanco for testing.

Upon approval between both parties after obtaining consents and permits, Grid Metals and Tanco will enter into a binding agreement to split the costs and profits of mining, processing and selling lithium spodumene concentrate to the global market based on prevailing spot prices for lithium spodumene concentrate.

Robin Dunbar, President and CEO of Grid Metals and Frank Wang, President of Tantulum Mining Corporation of Canada issued a joint statement:

 “The arrangement between Tanco and Grid to collaborate on the potential for toll milling Grid ore at the Tanco Mine is designed to add to the production resource base of Tanco and facilitate and enable a profitable mining venture between Tanco and Grid to be developed. With record lithium spodumene prices we see an opportunity to establish a profitable lithium joint mining operation and thereby grow the economy of southeastern Manitoba. We are of the opinion that southeast Manitoba will become an important hub for lithium production in the future to supply the North American market.”

Grid acquired its Donner Lake Lithium Property from Tanco in 2016 in return for granting a 2% Net Smelter Return Royalty and the right of Tanco to acquire products from the property at commercial terms whether ore or concentrate. Lithium Royalty Corp. also has a 2% Net Smelter Return Royalty on the Property.
Grid Metals Corp., Monday, October 17, 2022, Press release picture
Grid Metals is an exploration company that has a diversified portfolio of projects focused on the nickel-copper-platinum groups metals and lithium. The company’s projects are located in the provinces of Manitoba and Quebec.
Tantalum Mining Corporation of Canada operates the Tanco Mine. The company was acquired by Sinomine Resource Group which is listed on the  Shenzhen stock exchange and has a market cap of approximately $7 billion US.
TradingView Chart
The technicals look very good. Grid Metals is currently up over 18% at time of writing with over 337,000 shares traded on today’s news.
But what really attracts my technical eyes is the recent breakout above $0.15 which triggered on October 7th 2022. The stock has even completed its pullback and retest phase as evident by bulls jumping in on the retest on October 11th 2022. The technicals look prime for continuation. There is also a cup and handle reversal pattern which looks to have been triggered.
The $0.23 zone is the next resistance for the stock. Perhaps we will see some interim resistance at $0.19. However, as long as Grid Metals remains above $0.15, the uptrend will remain intact.

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