Surge Battery Metals Inc. (TSXV: NILI, OTCQX: NILIF, FSE: DJ5) has begun its fall drilling campaign at the Nevada North Lithium Project (NNLP) in Elko County, Nevada. The program marks an important step in advancing the project toward feasibility studies and reinforces the company’s goal of becoming a leading U.S. supplier of battery-grade lithium.
The 2025 program will drill nine holes totaling about 4,500 feet (1,370 meters). The first five holes are planned on private land operated by the Salmon River Cattleman’s Association under a newly signed Right of Entry and Exploration Agreement. The remaining four holes are scheduled for nearby federally managed lands pending Bureau of Land Management approval.
The campaign is designed to elevate the NNLP resource classification from Inferred to Indicated and Measured, providing greater certainty for investment and mine planning. In addition to grade and tonnage confirmation, the drilling will collect geotechnical and hydrogeological data needed for the project’s planned Preliminary Feasibility Study (PFS).
CEO Greg Reimer described the program as a key milestone. “Starting this drill campaign moves us closer to PFS and strengthens Nevada North’s role in developing a secure U.S. supply chain of battery metals vital for electric vehicles and renewable energy.”
Surge has explored the NNLP since 2022, completing programs in 2022, 2023, and 2024. Drilling confirmed a broad zone of lithium-rich clays extending more than 4,300 meters along strike and over 1,500 meters wide. Soil sampling and geophysical surveys suggest even greater lateral potential. Three main clay horizons have been identified, and the current program will test all three to refine resource estimates.
The project currently hosts a pit-constrained Inferred Resource of 8.65 million tonnes of Lithium Carbonate Equivalent (LCE), grading 2,955 ppm lithium at a cutoff of 1,250 ppm. This combination of near-surface mineralization and high grades positions NNLP strongly among U.S. lithium assets.
A Preliminary Economic Assessment released earlier in 2025 highlighted promising project economics. The study outlines a long-life open-pit mine with potential for 42 years of operation, averaging annual production of 86,300 tonnes of battery-grade lithium carbonate. Over its life, the project could produce about 3.63 million tonnes of LCE.
Development is planned in two phases. The first involves a processing capacity of 2.58 million tonnes per year, expanding by the fourth year to more than 5 million tonnes annually.
At a lithium carbonate price assumption of US$24,000 per tonne, the project shows an after-tax net present value of US$9.21 billion at an 8% discount rate and an internal rate of return of 22.8%. Startup capital for both phases is estimated at US$5.3 billion, with sustaining capital of US$1.51 billion. Operating costs are projected at about US$5,097 per tonne, positioning the project competitively against other global developments. Payback is expected in under five years.
The strong economics and resource potential highlight Nevada North as a future cornerstone of U.S. lithium supply. Lithium demand is rising quickly, driven by adoption of electric vehicles and grid-scale energy storage. The U.S. government has prioritized securing domestic sources of critical minerals, including lithium, to reduce dependence on foreign supply and strengthen clean energy supply chains.
Nevada offers favorable conditions for lithium development. The state is mining-friendly with extensive infrastructure and skilled labor. Surge’s location in Elko County further supports efficiency in exploration and potential future construction.
Collaboration with private landholders and regulatory agencies has been central to advancing the NNLP while maintaining environmental and community considerations. The newly signed access agreement with the Salmon River Cattleman’s Association reflects this cooperative approach.
The fall drill program will provide important data for upgrading resources, validating mine design assumptions, and advancing the PFS. Results are expected to add clarity around the size and continuity of lithium-bearing clays and further test unexplored horizons.
As drilling advances, Surge will continue to evaluate engineering options, economic sensitivities, and processing strategies that support a commercially viable, long-term operation. Progress toward feasibility studies will be key in attracting partnerships, financing, and regulatory approval for development.
By aligning with national priorities for domestic critical mineral supply, the Nevada North Lithium Project has the potential to play a defining role in the U.S. energy transition.
