United Lithium Expands Into The US, Acquiring Large Land Position In South Dakota

United Lithium Corp. (CSE:ULTH) continued to build its lithium exploration asset portfolio recently by acquiring a significant land position near Custer, South Dakota, in the west and southwest parts of the Black Hills. The company staked over 500 unpatented lode claims covering an area of more than 40 square kilometres. The new property covers public US Forest Service (USFS) administered lands interspersed with privately held properties, and hosts many pegmatite bodies that were mined for lithium and beryllium during WWII to supply raw materials for military use.

The Liberty Lithium Project is United Lithium’s first acquisition in the US, and is positioned strategically to supply lithium oxide to the battery manufacturers in the US that are in desperate need of lithium for the growing electric vehicle (EV) industry. The Liberty Lithium Project is located in an area with excellent roads, power infrastructure, and access to a skilled labour force, including many homegrown geologists and specialists educated at the world-renowned South Dakota School of Mines and Technology.

South Dakota is a mining-friendly jurisdiction with a long established mining industry. The iconic Homestake Mine, which was discovered near Deadwood in 1876 and mined to a depth of 8000 feet, became North America’s deepest underground gold mine, with production of 43.9 million ounces of gold until mining operations ceased in 2002.

While prominent in American history as the site of Custer’s Last Stand, the Black Hills are also home to culturally important American landmarks such as the Mount Rushmore and Crazy Horse National Monuments and other tourist and heritage destinations; the company deliberately avoided staking claims near any of these sites. Instead, the Liberty Lithium Project is located more than 10 miles away in close proximity to several existing operating pegmatite mines which produce mica, feldspar, quartz, and aggregates, and United Lithium plans to replicate these operations, but with a focus on spodumene as the target mineral.

Historical records indicate that close to 200,000 tonnes of lithium was mined in the Custer and Keystone areas of the Black Hills during the 1940s and 1950s. While the level of mining of pegmatites has declined since the war years, they provided a catalyst for the region’s economic development and are still a source of mica, feldspar, spodumene and other minerals.

As a part of its staking program, the company conducted a rock chip sampling program on the property and is awaiting assay results to determine initial exploration targets on the project.

Demand for lithium is rising rapidly due to global efforts to reduce carbon emissions caused by fossil fuel energy sources that has led to the proliferation of the EV industry. Lithium, as many investors are aware, is a key material used to manufacture the batteries to power these vehicles. According to Fortune Business Insights, the global EV market is forecast to grow from $287.36 billion in 2021 to $1,318.22 billion in 2028, at a compound annual growth rate of 24.3% during this period. 

The demand for lithium has created a lithium supply shortfall, as existing supplies are outstripped due to the lack of enough new sources of lithium coming on stream. This trend is expected to continue for the foreseeable future, which bodes well for lithium exploration companies such as United Lithium as the resulting rise in lithium prices provides explorers with the economic impetus to make new discoveries. 

The South Dakota acquisition is a significant strategic move by United Lithium as it is now situated close to the EV and battery gigafactories in both the United States and Europe. The pandemic and recent conflict in Ukraine and other geopolitical tensions underscore the importance of nations ensuring their domestic supply of key raw materials, strategic minerals, and reducing exposure to potentially disruptive supply chains. With its current lithium projects in Canada, Sweden, Finland, and now the United States, ULTH is now well-positioned to be able to supply lithium concentrates to major customers in Europe and North America.

FULL DISCLOSURE: United Lithium is a client of Canacom Group, the parent company of The Deep Dive. The author has been compensated to cover United Lithium on The Deep Dive, with The Deep Dive having full editorial control. Additionally, the author personally holds shares of the company. Not a recommendation to buy or sell. We may buy or sell securities in the company at any time. Always do additional research and consult a professional before purchasing a security.

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