In morning trade the Kidman Resources Ltd (ASX: KDR) share price has been one of the best performers on the local share market.
At the time of writing the lithium miner's shares are 7% higher to an all-time high of $2.28.
What happened?
This morning Kidman Resources released an update on its mineral resource estimate (MRE) at its Earl Grey Lithium Deposit in Western Australia.
According to the release, the deposit, which is a 50:50 joint venture with mining giant SQM, has been upgraded significantly after a 12-month resource definition and exploration drill program.
Management has advised that the MRE has been lifted 54% to contain 189 million tonnes of 1.50% Li2O or 7.03 million tonnes of lithium carbonate equivalent. Further, 91% of the resource is classified as measured or indicated, meaning this is likely to a very accurate estimate.
As you can see on the chart above, this positions Earl Grey as one of the world's most significant hard rock lithium deposits well ahead of the likes of the Mt Cattlin and James Bay operations owned by Galaxy Resources Limited (ASX: GXY) and the Pilgangoora operations owned by both Altura Mining Ltd (ASX: AJM) and Pilbara Minerals Ltd (ASX: PLS).
Should you invest?
While I think that Kidman Resources is certainly sitting on a world class asset, it is worth remembering that it will still be some time before it pulls lithium out of the ground. At present, production at Earl Grey isn't expected to commence until 2021.
Which means that there is no guarantee that the high prices producers are enjoying today will still be around when it finally commences production. In light of this, I would suggest investors stick with producers like Galaxy and Orocobre Limited (ASX: ORE) which are already producing and generating profits.
