Last week, there was a wave of news coverage about Lithium Americas’ Thacker Pass development, a caldera-hosted lithium mine in northern Nevada. While this news gained widespread attention, there is another early-stage lithium company that has been flying under the radar: Surge Battery Metals. With a lithium deposit that rivals Thacker Pass and a significantly lower market value, Surge Battery Metals is an investment opportunity worth considering.
About the Nevada North Lithium Project
The Nevada North Lithium Project (NNLP) is located in Elko County, Northeast Nevada. The project spans 22.45 square miles and consists of 725 mineral claims. Recent drilling results have revealed promising lithium content with grades averaging at 3,437 parts per million (ppm), surpassing even the exceptional Thacker Pass.
Drilling Results So Far
Drilling campaigns conducted at NNLP have yielded outstanding results. Some notable highlights include over 100 feet of 4001 ppm lithium in hole 5 and over 330 feet of lithium mineralization ranging from 3324 to 4105 ppm lithium in hole 7. The shallow zone assays have also shown lithium content of up to 8,070 ppm, the highest ever confirmed by a lab in Nevada.
Comparing Surge’s Nevada North to Lithium Americas’ Thacker Pass
The NNLP has the potential to match or even surpass Thacker Pass in size, grade, ease of lithium extraction, and level of impurities. Considering the current market capitalization of Thacker Pass, Surge Battery Metals is significantly undervalued, with a market cap of approximately $109 million compared to Thacker Pass’s $1.5 billion.
Surge Battery Metals’ Management
The leadership team at Surge Battery Metals brings a wealth of experience and expertise to the table. Chairman Graham Harris, who sold his previous company Millennial Lithium to Lithium Americas, leads the company. President and CEO Greg Reimer has a strong background in the energy sector, while directors Iain Scarr and Dr. Vijay Mehta have extensive knowledge in geology and lithium extraction.
In June 2023, Surge Battery Metals raised approximately $7 million, primarily from American Lithium. The company reported a balance sheet of $9.6 million at the end of June. With positive prospects and increasing attention on lithium in Nevada, future financing is expected to be readily available.
Surge Battery Metals has recently concluded its second drilling campaign and released results for two holes. Additional news may include land acquisitions, strategic investors, and site visits from global automakers. The Maiden Resource Estimate (MRE) is scheduled for release in either November 2023 or Q1 2024, incorporating results from the second drilling campaign.
Risks and Uncertainties
While investing in junior mining stocks carries inherent risks, Surge Battery Metals benefits from the success of Lithium Americas. Following a similar playbook, Surge has the potential to expedite the timeline to a producing mine or attract buyout offers. Additionally, the long-term demand for lithium remains bullish, despite short-term price fluctuations in the spot market.
With the potential to become the highest-grade clay-hosted lithium resource in North America, Surge Battery Metals presents an exciting investment opportunity. As the company’s official MRE confirms the project’s value, we anticipate an increase in awareness and a potential acquisition by a major player in the lithium industry. Investing in Surge Battery Metals at its current undervaluation could lead to significant gains in the future.