April 25, 2024

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To space and back: Hyperspectral tech to be used in lithium exploration at Lancaster Resources (LCR.C)

When I watch a mining-based TV show like those regularly seen on the Discovery Channel, and some mucky-booted, sun-beaten wanderer busts out their trusty gold pan or their metal detector to see if some patch of ground is worth sticking a hole in, I’m always struck by how mining technology hasn’t changed all that much in a hundred years. Or a thousand years, for that matter.

In this day and age where artificial intelligence and satellite imagery and drones exist and are put to good use by so many varying areas of commerce, it’s weird to me that we still send rock lickers out in 4-wheel drives to kick over some pebbles, dig about with a trowel, run a metal detector about for an hour, and send a bag of rocks to the city for a pointy head to look over.

We can bounce sound waves off your belly and see whether we should be painting the nursery pink or blue, but we can’t bounce them off the back 40 and see where to stick a drill?

Over the years, I’ve seen several groups try to change this, with all manner of alchemy designed to pluck riches out of tailings with magnets and molecules, or spot silver dust from space – or in space – and each new twist comes with the same promise; it’s all about to change. Mining is about to take it’s big leap forward.

It rarely does. The old ways work, and the new ways cost milliosn to prove out.

One group that tried was a company called Planetary Resources, that I wrote about back in 2013 or so. Their deal was, they were going to mine asteroids, primarily of water, which costs an absolute fortune to fly up from earth ($8000 per bottle, if I recall) but could be located in, mined from, and delivered by asteroids as they passed by on their orbits.

Planetary Resources raised big money back in the day, from all the usual tech billionaires with a notion to corner the next big mining rush, and the company did put some satellites in space before an expected financial investment by a large mining company was delayed long enough to bring the whole thing down.

Before it was sold for parts, Planetary Resources developed two big tech breakthroughs; distributed computing, which tempted a blockchain company to ultimately pick up its assets – and hyperspectral imaging, which its roster of scientific smartypants would take with them as they eventually went to work for Anglo American Mining (AAUKF.OTC), where they now make massive decarbonization machines for massive mining machines.

The hyperspectral tech, which was tested in Earth’s orbit and was initially going to be used to explore the contents of asteroids as rockets flew by, just showed up in my inbox with a new use case from a local lithium exploration firm.

Lancaster Resources Inc. signed a non-binding letter of intent today with KorrAI Technologies Inc., a pioneering hyperspectral imaging company. This strategic partnership aims to redefine the exploration landscape for lithium, uranium, rare earth elements (REE) and other critical minerals, marking a significant milestone for both organizations.

What is hyperspectral imaging?

Imagine using a super-powered camera that can see beyond what our eyes can, capturing images in many different wavelengths of light. This is what a hyperspectral imaging camera does, and it’s what KorrAI specializes in. This technology can look at an area of land and analyze the light reflected from the ground to determine what minerals are present, like having a map that shows you where to find minerals critical for making things like batteries, electronics, and renewable energy solutions.

To be clear, this is not KorrAI’s reason for being. In fact, their business model is predominantly around monitoring tiny ground movements to better understand things like the likelihood of a tunnel or tailings pond collapse, earthquakes, ground subsidence, shifting snow cover, coastal erosion, and underground water movement.

Using their tech to identify underground resources is kind of a phase II part of the plan, but the tech works for it.

Here, you can see a glimpse of that tech from 8 years ago, during the Plantary Resources hey-day, comparing what standard satellite imagery could see – blurs on a desert image – with heat registering data that showed the gassing off of a fuel refinery from space that would otherwise be not visible.

By partnering with Lancaster Resources, KorrAI’s technology will help pinpoint exactly where LCR should dig, reducing time, money, and environmental impact usually associated with traditional exploration methods.

It can also see through vegetation, identify faults and outcrops, and pick up differing elements.

Lancaster’s exploration projects, including their efforts to produce net-zero lithium, align with KorrAI’s capabilities in detecting changes on Earth’s surface with satellites and AI.

When Lancaster says this is a partnership, rather than a simple vendor transaction, they appear to be telling the truth. KorrAI could use their knowledge in defining and selling the tech to the sector at large.

While the letter of intent is non-binding, both companies are committed to advancing discussions toward a formalized agreement. The collaboration aims to leverage the strengths of each organization, combining Lancaster Resources’ expertise in lithium exploration with KorrAI’s cutting-edge technology to drive innovation in the exploration and extraction of critical minerals.

The quotes:

“We are truly excited to embark on this strategic partnership with KorrAI,” said Andrew Watson, vice-president, engineering and operations, of Lancaster Resources. “By integrating KorrAI’s state-of-the-art hyperspectral imaging technology into our exploration processes, we anticipate a rapid change in how we explore and develop lithium and other critical minerals.”

“We are proud to collaborate with Lancaster Resources, a forward-thinking exploration company dedicated to responsible mining practices,” stated Rob McEwan [not THAT Rob McEwen], co-founder and chief procurement officer of KorrAI. “Our hyperspectral imaging technology opens new possibilities for mineral exploration, and we believe that this partnership will not only enhance the efficiency of Lancaster Resources’ operations but also contribute to the responsible extraction of critical minerals that power the clean energy transition.”

Hot damn.

Lancaster’s differentiator in the lithium space is that it wants to explore and extract lithium in accordance with a net zero environmental mindset. To me, that’s enough of a difference to the bevvy of other lithium explorers out there to be interested, but this deal is WAY outside the box thinking and I like the balls out nature of it.

If Lancaster hits paydirt (or paymuck I guess) here, using this tech, and even shaves six months of their exploration time, let alone the potential years and millions it could save, that’s a massive win.

Pioneer technology never makes it first to market in mining. Everything has to be proved, proved again, and proved beyond all reasonable doubt before it can meet the mining mainstream.

This tech was being used in space in 2018. Putting it in the ground in 2024 is exactly the kind of progress you like to see and the sort of leadership that’ll rip the mining business kicking and screaming out of the Jurassic era.

Congrats, Lancaster. Stock is up from $0.055 to $0.08 in the last week.

— Chris Parry

FULL DISCLOSURE: Yep, I own LCR stock and the company has previously been a marketing client of ours. We’re conflicted, it’s true. But also, at one point this tech promised to be a billionaire’s delight. Here are the details of the time this tech was used from space and I have to think it’s ready for primetime now. Make your own call.

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