Jindalee Lithium Ltd (ASX:JLL, OTCQX:JNDAF) may be on the cusp of securing government support for its 100%-owned McDermitt Lithium Project in Oregon, USA.
Largest lithium deposit
Recognised as the largest lithium deposit in the USA by contained lithium, McDermitt is a globally significant resource. The company’s hope is to deliver lithium carbonate equivalent from the project to US supply chains for decades.
Jindalee recently lodged applications for non-dilutive grant funding with the US Department of Defense and the Department of Energy.
These grants, aimed at co-funding the project’s feasibility study and the construction of a lithium processing facility, have passed initial reviews.
Moreover, the Department of Energy grant application was backed by letters from politicians and agencies across Oregon and Nevada along with endorsements from potential project partners.
The US Government is pursuing robust funding initiatives for domestic critical mineral projects through legislative mechanisms like the Inflation Reduction Act and the Defense Production Act.
This commitment is mirrored by recent developments, such as the conditional commitment of a US$2.26 billion loan by the Department of Energy to Lithium Americas Corp for the Thacker Pass Lithium Project, right near McDermitt.
Perpetua Resources Corp also recently announced a Letter of Interest from the US Export-Import Bank for up to US$1.8 billion in capital funding for its Stibnite Gold and Antimony Project.
This follows earlier grants totalling US$59.4 million from the Department of Defense to assist in the project's construction readiness.
Sustainable domestic supply
In light of all this, Jindalee anticipates a positive response to the grant application and any potential award decisions in the second half of 2024, which it says will mark a milestone in securing a sustainable US lithium supply.
Jindalee CEO Ian Rodger said: “We are very pleased with the progress of our grant applications for the McDermitt Lithium Project, particularly with the strong backing we’ve received from key stakeholders, including US politicians and potential project partners.
“The support for our applications highlights the strategic importance of our project and its alignment with US national interests.
“These non-dilutive grants, if successful, promise to significantly enhance equity returns, reinforcing our strategy and amplifying the value we deliver to our shareholders.”