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Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
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Good morning, and thanks for joining us today for a Lake Resources Investor Webcast. Joining me today is CEO, David Dickson; Scott Munro, Senior Vice President of Technology, Strategy & Risk; and Sean Miller, Senior Vice President of Field Operations.Our format today will be conversational, as Scott, Sean, and David speak to the progress we have made since our June operational update. Accompanying our discussion today is a prepared slide presentation, which is user-controlled. So you can view it at your own pace.I do want to call attention to Slide 2, which contains our disclaimer. Please be sure to read the slide before delving into the presentation materials.I will now turn this over to Sean to kick us off today. Sean, there's been a couple of recent announcements regarding findings from additional drilling as well as successful extraction and injection testing. Could you address what this news means for us?
Absolutely, Karen. Thank you. We're excited about the recent drilling results in the North and overall performance and the improvements in the operations. We're seeing a large vertical and lateral expansion of the lithium-bearing brine in the reservoir, multiple exploration targets for injection of spent brine in the north and south [indiscernible] intercepted lithium-bearing brine above 200 milligrams per liter, which is fantastic for our reservoir. As a result of intercepting brine in these locations, additional exploration drilling and testing for suitable injection locations is currently underway. It's worth mentioning that we are also seeing in areas outside of the central resource area, coarser-grained, more permeable sediments that will provide for favorable conditions for injection. Operationally, we've seen a 40% improvement in drilling performance this year. We have just recently drilled 600 meters at K23 in the north. Previously, we had only drilled to 400 meters.Results show brines at 322 meters within this well, averaging 232 milligrams per liter. We've also just successfully completed stage 1 of our extraction and injection tests, which is a key milestone to achieve DFS. We successfully injected 30 million liters over 27 days. This test demonstrates the viability of the injection in the core resource area and provides confidence that injection is possible in more geologically favorable areas and outside of the core salar. We believe it's the first successful reinjection in Catamarca and the grades from these tests were about 260 milligrams which is 20% higher than what we saw during the exploration phase. And that pretty much covers the 2 main updates sort of recently announced.
That's great. And will there be further JORC updates coming prior to the DFS?
Absolutely. So for the full DFS, we'll see an update to our resource and so they're expected over the next 2 months.
Hello, Karen, and maybe if I can add just some things that Sean has highlighted. Obviously, we've had 2 very promising press releases over these last couple of weeks. And I just want to highlight to our shareholders that they fully understand, particularly on the press release around the drilling and the extraction and the reinjection because that was something which was a big focus for us. So to actually achieve that was a great result and great work by the team. And then secondly, the other press release where we've highlighted about drilling deeper, this was a strategic decision that we took as a company to say, "Hello, we're seeing some good quality brines at the levels that were drilled before. But hello, we've got indications of this reservoir actually goes deeper." So we have invested a small amount of dollars. Then we decided to drill deeper and we're seeing these good results now over a period of time. As we do more extensive drilling, then we'll get a better handle of what this actual reservoir looks like. But I think the promising thing is that that we've seen some really good results both in reinjection and drilling deeper.
That's really exciting to hear and I'm sure as we get the JORC updates, we'll have a better sense of what this really means. Scott, if I could turn to you now to pick up from where Sean left off, can you just talk about the progress we've made over the past couple of months towards the DFS and the EIA?
Okay. So obviously, DFS and EIA are key targets for us this year, and we're really focused on delivering those on schedule as we communicated in the operational update. The operational update was key for us because it allowed us to confirm the decisions we had made onto validation. And so following those announcements, we're moving ahead with Phase 1 DFS, which is for 2 trains of 12,500 tonnes per annum battery grade lithium carbonate capacity. And so we had to revise the designs and the layouts of the plant that we had previously been looking at. The key steps in this last month will finalize the heat material balance, which allows us to set up the plot plan and the drawings and layout. Those are now set. The model review is ongoing with a team at the moment. It allows us to move into HAZID for the plant and then release all of the data on the process flowsheets to our environmental consultant to do the EIA work. So really a key deliverable for us this month was to get the heat material balance done with our partner, Lilac. That's done. That's achieved. That's a key step for us moving forward towards the end of the year in delivery of the DFS.You can see on the left here on, if you're looking at the slides that we've put together, this is the initial plot plan that we've put together, a more compact footprint than the previous plant that we looked at, and we've relocated the plant to the Southwest quadrant of the field to be closer to our planned extraction and reinjection areas. All of that work is being combined and is refreshed with DFS work. In addition, we are kicking off workshops, both in local communities. So our second statutory consultation with the community for the EIA is scheduled to take place this month. And we have teams in country this week with the environmental consultant to go through all of the process technology data that we've created so far. So good progress there as well and both documents are on schedule for delivery in accordance to the previous plan.
That's great. It sounds like a terrific progress on both -- on all of those fronts. We've gotten a lot of questions about the power solution since we last updated our investors. And I wondered if you could provide some additional color on where we are with power solution, how much power we actually need and any details that you can share.
Okay. On the power, where we are at the moment for Phase 1 of the plant, we're looking at a requirement for around 60 megawatts of capacity for that first Phase 1 of the project. It comes in 2 steps. Train 1 requires about 20 megawatts to 25 megawatts of power for commissioning and start-up activities. And then we step up to 60 megawatts. The reason the second train requires more than the first is because it includes reagent, a manufacturer using the chlor-alkali plant. So really, what we're looking for is a solution that gives us access to 60 megawatts. Our best solution, as we communicated previously, our most technically sound solution is a grid connection. In discussions with local providers and the local statutory agency, we'll look at the grid in Argentina. It's been determined that the Northern route from La Puna in Salta is the best solution for us, and that's the one that we are working with our engineering contractor, Distrocuyo to perform a feasibility study for. So they've been released to perform that work and we're expecting that in the not-too-distant future. That will be incorporated into the results and that will be incorporated into our overall DFS plan so that we'll grow a good solution for both power and the plant as well.That capacity, so the lines that we plan to put out from the North can actually accommodate more projects than just us. So that's a key part of the solution here. So we have started initial discussions with other potential industrial users in the corridor so that we can actually share infrastructure and share capacity. So we -- as I've mentioned previously, for Phase 1, we only need 60 megawatts of capacity. The lanes that we're looking at and the lanes that we're sizing up at the moment actually have a capacity of 220 megawatts in total capacity. So we're looking at partnering up with 2 or 3 other users to work with this system.In addition, in the next phase, we'll be doing technical work. Up until now, we're really getting feasibility done, understanding what our requirements are. Next phase is really moving on to that commercial assessment. So we have engaged with 4 independent power producers from the local market. We're going to run a commercial process for them. They are signed up to take part and that will be happening in the second half of this month with the support of our consultant in-country, [ GME ]. So all of that's in place and it's moving forward.I did want to add because we had -- did have some questions about whether we were looking at solar for the project. So the first 20 megawatts to 25 megawatts worth of power at site that we need for Train 1, we plan to produce a significant proportion of that using our own solar spread at site. So we are always going to have a minimum solar contribution at site. But there is an alternative, we're continuing to look at, which is for an all-solar and battery backup solution instead of the transmission system and that hasn't yet been technically proven, but we continue to pursue it as an alternative to the transmission system. So solar is part of our mix, all the solutions, but it could become a larger part of our mix, depending on how the technical valuations go.
And maybe if I could just add something in Karen, to what Scott just talked about. I mean, when we go back to the 19th of June, the operational update, I don't think our shareholders really understood the complexities and are actually getting power to the west location since the 19th of June, the work that Scott and his team have done to progress probably quicker than I anticipated and I think we have from Scott is that we're seeing technical solutions. And as Scott said, now with those technical solutions, now we've to decide what is the best for us. But the big element is what is going to be the commercial agreement associated with those options. And so Scott and his team will progress that over these next coming months. But I think just for our shareholders' benefit is that we have the visibility of a number of technical solutions that can provide Kachi development.And it's probably also worth adding that the appetite [indiscernible] from the IPPs is high for this type of project. The most profitable sector for our providers in Argentina is business-to-business, private power purchase agreements, and that's exactly what we are. That's their main opportunity to make return on their investment. They get very small profit allocation from the government for other types of business. So we've had lots of interest in the 4 main power providers in country that participate in our project, and that really helps us to move the drilling forward.
That's great. I can tell from the questions that have come in about power that I think this was an area of concern given how remote we are in Argentina, and given what it would take to put all of this together. And I recall at the operational update, we talked about several good solutions [indiscernible] from the South and then some combinations are up. So it's not like that we had made great progress on this front. David, where are you most focused now, given that Scott and Sean are deep in the operations and you have these as well in hand, but as marked by the progress that we're reporting on, where are you most focused at this point?
Yes. So we -- well, if we just step back, what has now been in these initial months since we did the operational update, you've heard from Scott and Sean, great progress on both on the drilling and extraction side, the drilling side and then sculpt from really defining the project, defining what this thing is going to look like, looking at solving the issues around power. And with all of that, we said we said back on the 19th of June, we're going to deliver DFS by December. And you've heard from Scott, that is still on schedule. So we're 2 months further along, and we're still on target for the end of the year. So -- and the benefit of having these updates is that we can provide to shareholders updates on the progress in the DFS. So I'm going to say we're happy with that, and we're dealing with the right issues, right?So but since the operational update, and I think I said before, we have all the technical and management resources in place now to execute, right? So my focus with some of the team is now what are the strategic elements that we have to address to make sure that Kachi is going to be successful. And there's a number of things that I'm focusing my attention on. I mean, firstly, there's a political side now. We get a lot of questions about the political side in Argentina, and it is very difficult to address those questions when the election isn't until October and we'll get to see the outcome of that.But as I've said consistently is that whoever we talk to or which party in Argentina, it's clear that whoever is going to win this election has got a large support for developing the lithium market within Argentina and more importantly for us today is that we got a lot of strong support actually within the province of Catamarca. So politically it looks a little bit more stable. And so for us, we're catching it only. I think we're in a good place. So there's nothing much we can do on the political side. And also we monitor it on a daily basis. We have an ally who's a citizen of the country and monitoring things regularly and also conversing with government officials, international government officials, et cetera. So I think we've got on top of it. I was in Argentina with both Scott and Sean just a few weeks ago. We spent a lot of time talking to ambassadors from various countries, actually talking to the government. So I think from that aspect, the Lake Resources and the Kachi development is well known within this sector.But the big focus now is, okay, how do we finance ourselves from now and then ultimately raise money for the large capitals needed to execute? So a lot of the focus has been in that area, looking at the CFAs and then also looking at the capital needs are met. Again, we've highlighted it as we have 2 CFAs in place, which are non-binding today. And we also have a plan in place to look at the ECA-backed finance for this Kachi development. Where we sit today is the trigger for actually getting to the next phase with these 2 elements is really weighing with all over the DFS, right? So in the meantime until that point, we are in regular dialogue. I'm talking to the owners of the 2 CFAs, both SKON and WMC on a very regular basis. We're talking to the ECAs. We're talking to the banks on a regular basis. Scott and I will be on another tour in a few weeks, again, talking to a number of these stakeholders. But the critical time is going to be once we publish DFS. That really then triggers a number of things where we've got to get to work to get a number of these things up [indiscernible].That's really where the big real focus is and where I'm focused on a lot of efforts today.
So you're no less busy just shifting your focus.
Just shifting our focus. Making Kachi a reality.
Right. That's great. Well, I mean, I think it's safe to say that when you look at what's gone on in just these 8 weeks since we last met with the investment community, we can say that we're on target. The drilling program continues to confirm, the large scale and quality of our brine, process plant design is underway. We've made important progress towards finalizing the power solution. And once again, we're on target for completion of DFS in December, which will allow us then to move on to these other conversations with the export credit agencies and finalizing our Conditional Framework Agreement. So with that, I know we promised investors we would address the many questions that we've gotten since June 19.And if you turn to Slide 8 of the presentation, we've organized the questions by topic. And we'll do our best to address as many of these today as we thought was possible. But please continue to send in your questions, and I promise you, we will get back to you promptly. And for those of you who have taken the time to submit them, I want to thank you very much for your participation.
So I'm going to start with questions we've received around the DLE process and the Lilac relationship. Still lots of concern about whether Lilac's technology can work at commercial scale. Where are we with Lilac with testing the technology and where do we get the comfort that this will work at a commercial scale?
Yes. So obviously, we've had the demo plant in operation at Kachi. Well, they ran for about 6 months, we achieved the main milestones, and we are continuing to operate [indiscernible]. So the major technological scale-up for that deployment has been done. So we've moved from bench to demo size, the demo size to commercial size, the scale-up is actually significantly smaller. So all of our other magnitude scale-ups are no longer required and we're still now the largest single scale-up we'd like to do is a 3:1 on 1 of the components. So what we do have is multiples of these to install.So we'll have multiple modules to make the project work. So in terms of scale-up, it would be very little left to go to go from where we are now to where we want to get to. Obviously the reason for the DFS is to show commerciality for that technology, and we're tracking towards delivering that in December. What I will say is that the product, the Elliot has been getting from the DLE is exceptionally clean. So the proper value that we are taking to Saltworks to turn into carbonate is some of the cleanest products that, that contractor has ever had to handle.So we're very confident that the products we're going to get out of this entire system. It's going to be a high quality, and it's going to be very repeatable, and we don't have a lot of moving parts when it comes to what we put in and what we take out. So I think for us, all of the major milestones for the DLE have been achieved. We are confident now that we're going to get a repeatable deliverable product that comes out at the end of this month. We know that people who want to buy it, and are getting some extremely high-quality product. So I think for us, not to underplay the DLE technology, but it's the part that we have spent so much time and effort getting to understand that we are comfortable now that this is ready to move from demo plant to actual.
That's great to hear. And in terms of the relationship with Lilac, do you feel comfortable that this is a relationship that will go the distance and that will -- are they 25% owners today?
No, they're currently at 20%, not because they haven't achieved all the requirements for that. It's just we need to have a signed up and agreed offtake agreement to get someone to sign up against that last 5%. So it's nothing that Lilac has done and we fully expect that they will achieve 25% as we move through these next stages of the project. The relationship, I would say, is very, very constructive. They've got a lot of great people. They've got a lot of people with experience in large construction projects that they've brought on. Their team and our team are working together as one unit, and it's helped us to progress the things like the heat and material balances and the plant layout in line with the schedule that we put together. So we haven't had any times that we'll have to stop and restart things. We're moving forward together as a team. Just to add to that scope, we're also seeing a lot of collaboration within hydrogeology teams as well and sharing it the way they are working together around the DFS.
And just to add to what Scott was saying, we're still doing some work at site, at the demo plant. And I know said this to shareholders before. I think we're more in the phase of lately is that we're tinkering with the process, but we're playing the core sets and I've said this publicly make things is it's not the way those DLE work, it's not about the commercial side about Lilac, we're going to be the capital cost and ultimately, what's going to be the OpEx, right? That's what's going to make us competitive. And that's where the focus is on. And I think people need to shift away from this deal working on watch, but it's more focused on how commercial is and that's what Scott and the team are working with. I'm working with Lilac compensate their more senior level and then late to that with regards to strategically delivering this project because. s you said, if they're -- if they become a 25% shareholder, look at 25% of the equity component of the finance and they've got to put a place. So we're going to work closer with them to work strategically in how we raise that money. But to Scott's point, I think the relationship to be in is very constructive.
And you've mentioned a couple of times that the demo plant is still up and running. Are you continuing to produce lithium carbonate at the demo plant and can you sell it as a way to get revenue into the company?
So the demo plant for us is actually split into 2 components, right? We've got the on-site demo plant for the DLE. And so that produces lithium fluoride from our brine. So as we announced earlier this year, when we hit our final milestone, we shipped that lithium chloride from site, that was about 120,000 liters of lithium chloride that we then sent to our contract to Saltworks in Canada. And it is actually at Saltworks where we produce lithium carbonate. So that first 120,000 liters we have processed the first 2 batches of 40,000 liters each, and we're doing the final 40,000 liter batch right now. So we will have all of our lithium carbonate in place within the next 2 weeks. That lithium carbonate is a relatively small quantity. The reason that it's been produced is so that we've got enough to do testing and to demonstrate quality of what we produce and to our available samples to give to potential offtakers. So really, what we're producing here is sub-commercial scale, we couldn't sell it even if we wanted to because we don't have a production licensing country.What we'll say is we are also still producing lithium chloride at site. We don't intend to turn that into lithium carbonate right away. What we want is more lithium chloride samples available to help us when we move into the feed and the feed design phase of the project because we do need to do it tested on some of the downstream elements. So we have material. We've got sufficient to do the testing that we require for DFS and the feed and the feed design, and we also have sufficient to satisfy any offtake up when they're looking for samples to make sure that what they're buying is what they want to buy. That's what we'll try to do.
That makes a lot of sense, and it's a very clear answer. Thanks for walking us through that. Scott, I know that you've given a lot of proof points of progress on the DFS. We still have investors concerned that maybe we're going to get to December and not be ready. What components would you say are most at risk?
The challenge always with engineering estimates is getting enough response back from the supply chain, right? Because supply chain is a big component of our spend. We can do estimates on man-hours, on construction hours and logistics and all these things. But we will require feedback from the supply chain, and that's for major equipment vendors, all of the components that make up the system. And so we want a good quality DFS. We want something that is supported by actual bids from potential suppliers. We don't want something that's just taken out of a handbook and transferred into the estimate. So the critical part for us is to make sure that we're getting good engagement with supply chain. And my team is out there working the phones, working the relationships so that when the package would show up on the desk, people are ready to respond and are willing to respond because it obviously takes in some effort, and they know this is for DFS. It's not for a salt work where they can win some work. So we are using relationships that have been developed over the last few months to make sure that we get the responses we need on the major packages that will form the basis for our estimate.
So moving on to the offtake agreements or the conditional framework agreement to be more precise that we have in place right now. A lot of questions around the clarity on the status of these agreements and whether they're still holding at the agreed price point as they were created at, especially in light of the share price, which was 5 multiples at the current level. With the agreed equity holding and capital will be honored?
So these are as you said conditional framework agreements, right? And the trigger point is when we publish the DFS, there's a lot of things that are going to be happening between now and, I guess, 4 months away when the DFS was posed. At that point, that's when we start to negotiate low. Where will our stock price be in December or post-DFS? It's also very difficult to project. But the way I always address this was that end of the day, was a huge demand for lithium carbonate barren grade in the market. And so when you look at the other deals are getting on the market, there's everything drawn equity injections to injections at asset level to prepay it. So I think in those negotiations is a long way to go, what is going to come back to us is how much the offtakers are prepared to pay as an investment to get their 25,000 or 50,000 tonne of offtake. And we can talk about whereabout. I mean the market today is very healthy. With regards for on the supply side with regards to the supplied demand side, we'll concord and we can touch on that when we talk about market and stuff.But we're not sitting here concerned and we're certainly not getting any indications from our 2 offtakers that they don't want to continue with the agreement. The thing is there's nothing really happens until we get to that point of publishing the DFS.
So I would guess that we're going to have a similar answer in terms of working with the export credit agencies and questions around project funding because you mentioned earlier that a trigger point for those conversations is also the completion of the DFS. But we have heard from investors that they're concerned about how we're going to fund this project given the growth of CapEx that we announced back in June. The range that we provided was $1.1 billion to $1.5 billion needed for Phase 1. And with our current market cap and unresolved power supply solution, and I'm quoting the question. "What is our view on whether this will still be an attractive project to fund from the export credit agency's perspective?"
Yes. So first of foremost, what we've demonstrated back in operational update is the economics of this project, even at those CapEx levels are still very attractive. And the question will always be as what is the long-term pricing and again, you can talk about that later. I think for the project financing and a lot of people understand is that today, we have 2 ECAs and 2 banks that are currently supportive of the project. And we did present this data or these numbers to those support stakeholder prior to doing an operational update. We are still in dialogue with those stakeholders. Now what has that is -- we don't -- we give a bang on CapEx between $1.1 billion and $1.5 billion. So we can't sit down to negotiate with the banks until we start to firm up in our numbers and when stronger, that's going to be one of the outputs from the DFS. So again, when we get the DFS published, then we'll have a number of the level of CapEx that we need to raise. We'll obviously have a split between equity and debt, and then it really will allow us to get it to work later. We don't need the funding in place until Q1 of 2025 when it was the time that we're targeting to go to final investment decision.So today, we have time on our side to work there. What is the best way to finance this project. But certainly, the ECA is having run away and the banks have not run away based on our new numbers. I also think a little bit of that's reflective of that the market. Since we have come out with announcement, there's a number of other companies who have started to announce higher CapEx as 2 weeks ago, and there was one company who came up NERF PFS adds benefit CapEx of $1.3 billion or 30,000 tonnes. It's not outside of it from where we will be getting our operational update. So I think the banks and ECAs now are starting to adjust these level of CapEx numbers previously. We're only significantly underestimated. But ultimately, at the end of the day, the banks are focused as these players are always focused on what is the answer. They just want to thank their works. And if you look at lithium market, and it was not to look at what's been said in the political world of lithium, we look at long-term prices and what we start to see is a couple of years ago, people were looking at PFSs of $14,000 a tonne. And now the PFS is at $30,000 a tonne. The DFS is at $30,000 a tonne. So people now are starting to creep up on the method pricing, which always gets back to saying that the economics projects will stack out.Today, we don't know exactly what this one is going to look like. The corner is we're still under path of what is going to be some sort of ECA backed payments.
How do you think about working capital from now to FID?
No. That's a really good question. We announced about 4 weeks ago at the end of June 30 or at the end of the Australian financial year we had still had something like $90 million roughly in terms is just over USD 60 million. On average, our monthly burn rate about USD 5 million. So based on that retail, we have some a lot 12 months of run rate now. We have other things that we would like to do in that period of time. And then one had a chart again. So really good work on drilling and additional works. For stock, we used to move at some point to increase the land engineering activity towable to select. We feed the engineering contractor or maybe EPCM. So there are going to be some lumps that are going to come along. So what we're looking at is our budget, our facial plan with our capital strategy. And then part of that capital strategy also taking into consideration like we expect to start to see proceeds from offtake agreements or something to that.So we're very well focused on how much money we're spending, how much money will go up, how much money we need to spend, and then how we're going to manage that from the capital from now until May of year.
So I would imagine that when you think about other projects and drilling at other sites, I'm sure that's a consideration protecting the cash that we have to be used at Kachi. But we are asked quite often about whether our focus is exclusively on getting Kachi up and running. What would we consider between now and time to persist on drilling and some of our other tenements?
Yes, absolutely. So that is, we haven't been focusing purely on Kachi up to date. What we are doing now to sort of leave our attention to other sediments and objects that we have. We've done a lot of work in the background on just making sure our permits and licensing are in those areas. The next step is for the teams to go through and evaluate all of the work and the delta we have today. So basically form an opinion on each of the areas on what the best strategy is going forward. And then basically taking those proposals to form into the leadership team to work out where our money is best spent. We want to make sure as we're spending our cash, we're going to get a return for it. We don't want to be drilling necessarily in those areas. So we pulled the strategic group within the business, and we are moving attention to those other projects now.
Yes. An example I look at is what we just names, we'll spend a little bit more money on drilling deep at Kachi. Ultimately, we're looking at big expansion in Kachi. This one is to explore deeper where we have indications that it was buying resident. So good results on that. So Sean with his team, we're looking at strategically where is the best place to get our dollars, but also we're certainly happy with the money we spent on the deeper Kachi development.
And just as a reminder to some investors who might not be familiar, our other projects are also in Argentina, which brings me to my next question around the political instability. And you've mentioned it before, David, that it's certainly a big year for Argentina as their presidential election is coming up in October. What is the impact of the hyperinflation we're seeing there and like access to supplies and labor? What's the impact on the company?
Yes. So that question, I just asked them well. I think today, for Lake Resources, the impact is minimal and I may not be saying right, but understanding is that only as a company on average, we spent $5 million a month. Some of that is in Argentina. So with technical, we actually don't spend a lot of money in Argentina today. When it comes to us spending a lot of money in Argentina probably is into 2025 onwards. So obviously, we're looking at more longer range when is going to happen. Now between now and then, there's election has to happen. There'll be a fall out from the election. And we saw what happened in the primaries only a week ago, where everybody was caught by surprise of the result of the primaries now. There's going to be a lot of activity going on between now and also for October 22 for the inflation watch. But that's where these things will start to look at in the last ones. We know who's in power, and then their view on what's the one market, whether they're going to do in the economy, there's just so many things to so many moving parts.But what is interesting to consider though is that we're looking at producing at the end of say half of 2027. By the time we get to that point, there's going to be another general election, roughly at that time. So there's a lot of politics and we're going to get through between now and then to. As I said, today, we were not spending a huge amount of money in Argentina. So it is an impact in the company significantly. But certainly, we're watching on a daily basis.
Yes, lots of moving parts. And while we are asking you to look at your crystal ball, tell us what you're thinking about lifting on pricing.
So on anticipation, I've done this. I wasn't back looking at some of the recent benchmark in past markets. And I think I've always said that again, coming back to my short tenure in the mining business and lithium business with less than 12 months, we're taking it for sure, it's extremely fragmented. The forecast looking forward are really fragmented. I think what I'm confident on is that lithium price then is going to start to move up. It -- and I look at -- I said it earlier, I looked some of the prices that were used for PFS and sometimes we go $14,000 a tonne. The most recently let by another developer, we're using $30,000 a tonne. And so things have shifted in that direction. Looking at some of the benchmarks, it's interesting. You look at easy penetration was to go ahead as planned but the governments want to do a number of contradicts and you look at the ambition and the big large kind of manufacturers. It's intensive than the demand for lithium by 2030 is only 5 million tonnes -- sorry. 5.4 million tonne. Today, we produce less than 1 million tonnes. And if you look at all the projects that are planned to go ahead, we might get to just over 2 million per tonne.That tells me that we've significant restoration locate the whole supply/demand balance. So I think for us, we use the operational update and then I'll let Scott maybe out to it. We used $23,000 some interesting per tonnes as our base case, and we ran another case of spot price and I think the we need to fall in deal. But yes, I mean, I think, generally, our view within Lake Resources as we anticipate that within prices on is going to be on the up. That's obviously not talking about spot price in time. We're talking about prices from '27 or '27 in one year in production. But yes, and I don't see any other way why it's not easy penetration to sound it happen. Right? We can see it when we set was you can see in near. Scott and Sean, good to hear your views on lithium pricing.
Well, it was interesting. I was in Salta last week for the symposium and they had all of the major pricing forecast agencies here and Joe Lowry, Mr. Lithium was given more of the keynotes features. And it was interesting how everyone was forecasting the supply and demand would be roughly in balance by 2030. And then each one of them said, what they think everyone might be a little bit optimistic on the amount of supply that's going to come into the market. Because if you look at the number of projects we need to make that balance happen, it's a lot of projects. And most of those projects need to come in Argentina. And so the strange thing about pricing forecast is we get 2 benchmarks. One forecast is a surplus, one forecast a deficit, but they're all forecasting roughly the same price, and it's roughly the price that we used in our market update.And so it's interesting that even though one is showing surplus and one is showing deficit, but they're both coming out with the same number. So it will be interesting to see where this thing trends. It does need an awful lot of projects to come onstream in the next 5, 6 years, try to achieve the balance that everyone is talking about. And again, just anecdotally, we talked to end users in this material. And they casually throw out that they're going to have 600% growth in 5, 6 years. That is a lot of projects. That is a lot it. And as on the supply side, we'll make you work really well and really hard to make that happen. So that should to me, tell us that we should have growing demand, strong market and pricing that should be supported.
That's a really exciting forecast, and I guess we'll see how it plays out. Well, I just want to thank you for joining me here today because I'm really excited to connect with our investors and keep the investment community closely posted on our progress, on our perspectives and we look forward to staying in touch with all of you and reporting back in about a month's time.Thanks for your time today and we'll talk soon.
Thank you.
Thank you. Bye.