HD, there are still a lot of unknowns here. And the reason to probably not use an existing well could be the following:
1. They are all plugged except one for disposal.
2. The max life listed for one well was 100yrs. All these wells have been drilled in the 60/70s and life expectancy of these wells are unknown, my guess 100yrs max, but they are all sitting at 50-60yrs right now and they would have to be redrilled being plugged, and they don’t even know at which levels the best mixture of Li is at because they didn’t care about that back in the 60s.
3. The only data for Li is from some other wells in other sectors. The ones close to the sectors we own don’t have a good ppm of LI, the only well that shows 1,700ppm is in section 9 (more northwest than ours) Over all it looks like the lower the number of the sector the better the ppm of Li. But it’s still unknown.
So in understanding the Dec report, it makes a lot of sense of what they said in the Feb 14 PR.
They need to drill or re drill plugged wells, Hince why the bids for drilling companies.
They then need to get an analysis to tell them about Li % from the drillings because it’s still vague with the exception of what I said above and they have no idea at which levels has the best.
Which drives why they are looking at buying more land rights… lower number sectors are showing historically to have better Li ppm.
Summer 2022 will have a lot more info until then, we wait… currently the shareholders are the only source of income for the company so expect the O/S the continue to increase because all of this requires a lot of money.
All in all, I would think a winter 2022 production to be a reasonable goal. In the long term, depending on how well the PPS does after all of this will drive if they do a RS or not. Other companies have half of the O/S of what we have and they are around $1.00.
