Li-FT Power eyes Yellowknife for continent’s next big lithium resource

Yellowknife was founded on gold mining, and now lithium holds the potential of opening a new chapter for the Far North’s second largest city.

Just a short drive east of Yellowknife and off the paved, all-season highway the Ingraham Trail, Vancouver-based explorer Li-FT Power (CSE: LIFT) is preparing to turn its drills on 13 targets it calls the Yellowknife Lithium Project.  

“When you talk about the potential, it’s just really easy to see because the pegmatites stick out of the ground and you can fly over them, they go for 1.8 km, and you just see almost 100% exposure,” Francis MacDonald, CEO Li-FT said in an interview with The Northern Miner.

“It’s very easy to see the size potential and imagine that this really could be one of the largest hard rock lithium resources in North America,” said MacDonald, an exploration geologist who co-founded North America-focused explorer Kenorland Minerals (TSXV: KLD) in 2016.

Two sets of targets, the Nite and Big East and Big West pegmatites are located about 25 km east of Yellowknife. All three have grades ranging from 1.45 to 1.53% lithium oxide (Li₂O). The Big pegmatites consist of dyke swarms of more than 150 metres width and extend between 900 and 1,000 metres in length. Nite, a linear dyke of 4 to 10 metres in width, extends for 900 metres.

Those pegmatites were trenched and sampled by Canadian Superior Exploration from 1975 to 1979, according to the NI 43-101 report for the project, published on Dec. 30. 2022.

About 30 km further down the highway, another cluster of targets, the Fi, Ki and Shorty pegmatites sit north of the Ingraham Trail and just east of Hidden Lake Territorial Park. Ki and Shorty are within a 3-km radius, MacDonald said.

Fi Main extends 1,800 metres – composed mostly of a linear dyke about 15 metres wide – and channel sampling conducted between 1956 and 1979 returned grades of 1.20% Li₂O. The 12-metre-wide Ki runs 600 metres and grades 1.40% Li₂O, based on spodumene crystal counts, Li-FT says. And Shorty, a linear dyke, runs 400 metres at about 25 metres width (up to 40 metres wide in places) with grades of 1.07% Li₂O.

“[These have] been off everybody’s radar, and there’s really been no work done on [them] since the 1980s,” MacDonald said. “So, it’s kind of a diamond in the rough. And it’s just been sitting there. So, I think it’s quite exciting from that standpoint, in that it’s not an old project that’s been kicked around.”

In terms of grade, the explorer’s Thor target has the highest, at 1.59% Li₂O. It was drilled and sampled between the late 1950s and 1970s by Down North Minerals and Canadian Superior.

“There’s massive spodumene crystals there, up to 80 cm long,” MacDonald said. “Big crystals are important for lithium deposits because you can run a DMS circuit which makes it simpler for the processing.”

However, that pegmatite is among the most remote of Li-FT’s targets, and sits 120 km east of Yellowknife and 20 km northwest of Great Slave Lake. It has no road access. Thor is also located north of the Nechalacho project, where Vital Metals‘ (ASX: VML) Canadian subsidiary Cheetah Resources is developing Canada’s only rare earths mine. MacDonald said the Thor target is about 50 km away from Nechalacho. 

Li-FT has raised about $17 million including from flow-through financing for the exploration projects, MacDonald said.

Winter drilling plans

Following the filing of an NI 43-101 report on the project on Jan. 13, the company’s next big step is starting its drill program this winter to determine inferred lithium resources.

It has received its land use and water permits from the territory’s regulator the Mackenzie Valley Land and Water Board (MVLWB), and plans to set up two drill programs: one at the Nite and Big East and West pegmatites; and another near an old mine site by Hidden Lake to drill at Fi, Ki and Shorty. Four to six rigs will be deployed in total.

MacDonald said the company has an agreement with the federal government – which remediated the site after previous gold mining activity in the 1960s – to start a 49-person camp there.

While the CEO hopes drills can begin turning in a few weeks, the MVLWB informed Li-FT it needs to undertake more engagement with local Indigenous groups and cabin owners before it can start drilling.

MacDonald said company representatives met with the chiefs and councils of the Yellowknives Dene First Nation (YKDFN) in mid-January and shared information about the drilling projects. More meetings with Indigenous community members are planned for February.

“We’ll continue to engage with them until the MVLWB are satisfied with our engagement,” he said.

Beyond eventually opening a lithium mine in the Northwest Territories, and producing spodumene concentrate, Li-FT’s ultimate goal is to bring the project to the point where a lithium converter facility can be built in western Canada.

“You need a big enough resource to justify building a converter,” MacDonald said. “We might look at doing it ourselves if we bring in…an established lithium producer. Then Li-FT could be a partner in a lithium chemical production business.”

But looking at the nearer term, he sees lithium exploration and mining in the Yellowknife region as an opportunity to revive its historic mining prominence.

“The gold mines started to wind down in the late 80s, early 90s. And then the diamond mines came online, and so that fuelled Yellowknife for 30 years and then eventually these diamond mines will wind down, and hopefully lithium will be the thing that fills that gap. [It’s the] prosperity that mining will continue to bring Yellowknife into the future.”

Li-FT shares are currently trading at $9.76, in a 52-week window of $2.35 and $16.50. It has a market capitalization of $355.8 million.