Eye on Lithium: Double lithium output in 5 years? No worries, say Aussie lithium producers

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• Australia to double lithium output in 5 years, from 330,000t LCE to 660,000t LCE
• 10-fold demand increase projected between now and 2030
• Askari Metals hits more lithium in Namibia, Burley drills more white gold in Canada

All your lithium news, Wednesday May 17.

After five months and a fairly precipitous drop in the spot price of lithium carbonate equivalent (LCE) in China, it seems that a steady recovery is afoot.

Citi analysts (and others such as Goldman Sachs and Morgan Stanley), who started poo-pooing lithium in December last year with price downgrades that put pressure on stock prices, reckon the only way is up for the rest of 2023.

That’s good news for us here in Australia, as we’re well on our way to double our lithium output by 2027-28, which would make us the largest producer of lithium in the world.

The Department of Industry, Science and Resources still holds on to its projection of lithium hydroxide prices to lift to over US$60,000 per tonne this year, even though it sees the price smoothing out over time by 2028 to about US$36,500/t.

During the same period, lithium production out of the country will grow from 330,000t LCE to 660,000t LCE.

With a 10-fold demand increase projected between now and 2030, Australia is set to play a pivotal role in providing lithium for EV’s, batteries and electronic devices.

Apart from a predicted deficit of battery-grade lithium driving demand, EV adoption will lead the line, as it’s expected that they will make up more than 40% of all vehicles sold by 2030, the International Energy Agency says.

Lithium carbonate prices remain unchanged for a second day in a row, sitting at US$31,060.12 per tonne.

Here’s how ASX lithium stocks are tracking:

45 lithium companies were up today, 52 remained the same and 48 dropped in price.

WHO’S GOT NEWS OUT?

Askari Metals (ASX:AS2) has drilled into more broad lithium bearing pegmatites at its flagship Uis project in Namibia.

The boardroom has been busy lately, as the news follows a recent $2.5 million investment from battery giant Huayou International Resources to be used for exploration.

Uis covers 308km2 and is situated next door to  Andrada Mining, which has an 81 million tonne (mt) lithium resource and is looking to expand to about 200mt.

Askari also recently installed Canaccord Genuity as its markets advisor to help deploy a capital markets strategy for the development of the project.

“The aggressive exploration strategy on our Uis project is proving successful, as we intersect more and more 100-metre-wide pegmatites with lithium-bearing minerals identified in the drill chips,” Askari exploration VP Johan Lambrechts said.

“The first phase of drilling was an introduction to the unexplored world of the pegmatites on our project area, allowing us to gather benchmark data that will inform our next drilling and exploration campaigns.

“The results have seen us intersect some very wide pegmatites with lithium-bearing minerals, and we eagerly await the assay results of these follow-on phases.”

And just like that, the Tabba Tabba tantalum-lithium project is back!

Once perused by WA’s own lithium giant Pilbara Minerals (ASX:PLS), Wildcat Resources (ASX:WC8) has come out of a trading halt with the project, paying vendor GAM 250m shares (about $14.5m at current prices) for it, in turn making GAM a major shareholder in the company.

Previous drilling at the historical mine intersected high-grade lithium, including 8m at 1.42% Li2O from 4m.

“Tabba Tabba is a proven LCT pegmatite system that was within Pancontinental’s tantalum portfolio in the 1980s, along with Pilgangoora (Pilbara Minerals), Wodgina (Mineral Resources) and Yinnetharra (Delta Lithium),” WC8 executive Matthew Banks said.

“Our technical team believes there is significant exploration upside at Tabba Tabba, it is located within granted mining leases and we have approval for a 200-hole drill program.

“On deal completion we will welcome a range of major shareholders to the company and look forward to following through with discovery-focussed drill programs earmarked for 2023.”

Burley Minerals (ASX:BUR) has gone to market and swiftly shored up $4.5m to advance exploration at its Canadian lithium assets.

Further progress is to be made at its Chubb Lithium project in Quebec’s lithium precinct, with more drilling expected to start soon.

The explorer will also use the cash to advance studies at its Bouvier asset.

Both projects are in close proximity to ASX-listed miners Piedmont Lithium and Sayona Mining’s spodumene concentrator – the only one currently operational in Canada.

“Our geologists are currently on the ground at Chubb, planning additional holes to significantly extend our 5,000m Phase 1 drilling campaign announced last month.”

Burley said it was also looking forward to initiating planned targeting work at its Gascoyne projects in WA that run along the same corridor as the now famous Yinnetharra lithium precinct.

Future Battery Minerals (ASX:FBM) shared some new spodumene hits to the market today, signalling its intent to move on from Phase 2 to Phase 3 drilling at its Kangaroo Hills Lithium Project (KHLP).

Diamond drilling at the site showed multiple, near surface thick spodumene bearing pegmatite intersections at widths of up to 23.8m, giving further confidence to planned Phase 3 exploration work.

The diamond drilling is a follow-up to the company’s April Phase 2 RC drilling to infill the RC drill holes and provide core samples of the pegmatite.

5 holes were drilled for 313 metres to test previous RC drilling and produced high-grade intercepts of 27m @ 1.32% Li2O and 29m @ 1.36% Li2O.

Those drill cores were sent off for testing and results are pending, together with assays from the remaining 23 drill holes from Phase 2.

At Stockhead we tell it like it is. While Future Battery Minerals and Burley Minerals are Stockhead advertisers, they did not sponsor this article.

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