Liontown Resources (ASX:LTR) definitely has itself a good patch of dirt in Western Australia, uncovering more high-grade lithium.

The latest round of resource drilling at the Kathleen Valley lithium and tantalum project returned individual assays of up to 5.7 per cent lithium oxide (Li2O) and unearthed a zone of +3 per cent Li2O – which is still “open”.

This news again moved the needle on the share price, which advanced a further 15.4 per cent to 15c at the opening bell this morning.


Just a couple of weeks ago Liontown announced an increase in the size of its Kathleen Valley project resource by 86 per cent to 4.5 million tonnes of lithium carbonate equivalent (LCE) and 43 million pounds of tantalum.

But the company stressed at the time that this was just an interim number, announced because Liontown realised that a previous exploration target would be “materially exceeded”.

Now, drilling has returned broad high-grade hits like 43m at 3.1 per cent Li2O from 253m, including 21m at 3.8 per cent Li2O from 272m.

These new results extend earlier mineralisation hits of 13.1m at 3.1 per cent Li2O from 299m and 12m at 3.1 per cent Li2O from 218m, which are located ~150m along strike to the northwest.

But this zone still isn’t closed off. Liontown says the newly identified +3% Li2O mineralised zone remains open to the north-west and it plans to drop an extra 8-10 drill holes into the ground to test for strike continuity.

Managing director David Richards says Kathleen Valley is one of the few new, significant lithium projects of scale currently being progressed towards development in Australia over the next two-three years.

Drilling is now expected to continue to mid-March and provide solid data for a bigger resource as well as underpin a definitive feasibility study.


In other ASX tech metals news today:

The market also liked Barra Resources’ (ASX:BAR) news that it had delivered a positive pre-feasibility study (PFS) result for its Mt Thirsty cobalt and nickel project in WA. According to Barra, the Mt Thirsty project now “assumes the mantle of Australia’s most advanced genuine cobalt project”.

Shareholders obviously liked the news because they sent the price up nearly 11 per cent in early morning trade.

The PFS estimates the project will produce 19,100 tonnes of cobalt and 24,800 of nickel as a mixed sulphide product over a 12-year mine life. The net present value, one of the metrics that indicates how profitable a mine will be, is forecast to be $25.7m after tax, with project capex tipped to be $371m.

Meanwhile, the WA government has gotten behind Technology Metals Australia (ASX:TMT) and its Gabanintha project, which has now been dubbed a “lead agency” project. This designation will help fast track the approvals process.