Lake Resources share price leaping 10% higher on 'major milestone'

Lake Resources uses ion exchange technology for lithium production, greatly reducing the environmental footprint.

| More on:
Man pointing at a blue rising share price graph.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • The Lake Resources share price is up 10%
  • The ASX 200 lithium company reported producing 2,500 kilograms of lithium carbonate equivalents without the use of evaporation ponds
  • On completion, the Kachi project, in Argentina, is expected to produce 50,000 tonnes of battery-grade lithium products per year

The Lake Resources N.L. (ASX: LKE) share price is surging in Monday morning trade, up 9.8%.

Shares in the S&P/ASX 200 Index (ASX: XJO) lithium stock closed Friday trading for 46 cents. Those shares are currently swapping hands for 51 cents apiece.

This comes after the company released a promising lithium production update.

What did the ASX 200 lithium stock report?

The Lake Resources share price is leaping higher after the miner reported it had produced 2,500 kilograms of lithium carbonate equivalents (LCE) at its lithium pilot plant Project Kachi, located in Argentina.

The announcement of this "major milestone" was made jointly with Lake Resources' direct lithium extraction technology partner, Lilac Solutions.

The partners noted that this marks the first successful use of ion exchange technology for lithium production in South America. They pointed out that the continent is home to "most of the world's lithium brine resources".

Following the successful production, Lilac's ownership of the Kachi Project has increased from 10% to 20%.

According to the release, the LCEs were extracted with 80% lithium recovery, 90% plant uptime, using 1,000 times less land compared with evaporation ponds, and 10 time less water compared with conventional aluminium-based absorbents.

Commenting on the results sending the Lake Resources share price surging today, the CEOs said in a joint statement:

Today's announcement marks a new era in scalable lithium production. Lithium is a cornerstone of the energy transition – but limitations in production technology have led to increased costs, scarcity, and extreme price volatility.

Today, we've proven that it is possible to produce high-purity lithium faster and without evaporation ponds – all while protecting surrounding communities and ecosystems.

The partners added that following on this success Kachi is on track to move from its pilot phase into commercial-scale development. Once operational, Kachi will be the first lithium brine project in South America to produce lithium at commercial scale without evaporation ponds for lithium concentration.

On completion, Kachi is expected to produce 50,000 tonnes of battery-grade lithium products per year.

Lake Resources share price snapshot

As you can see in the chart below, the past 12 months have seen the Lake Resources share price come under serious pressure.

With today's intraday gains factored in, the ASX 200 lithium share remains down 78% since this time last year.

Of course, investors who bought stock at Friday's close will be sitting on today's gains of 10%.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Gainers

A young woman holding her phone smiles broadly and looks excited, after receiving good news.
Share Gainers

Why A2 Milk, EOS, GQG, and Mineral Resources shares are racing higher today

These shares are ending the week strongly. But why?

Read more »

A man wearing a red jacket and mountain hiking clothes stands at the top of a mountain peak and looks out over countless mountain ranges.
Share Gainers

Here are the top 10 ASX 200 shares today

It was another disappointing day for ASX investors this Thursday.

Read more »

two men smiling with a laptop in front of them, symbolising a rising share price.
Share Gainers

Why Pinnacle, PWR, Race Oncology, and Vulcan shares are flying today

These shares are having a good session on Thursday. But why?

Read more »

A beautiful woman holds up one finger with one hand and has her hand on her waist with the other as she smiles widely as though she is very pleased about something.
Share Gainers

Why Boss Energy, Emeco, Mineral Resources, and Plenti shares are pushing higher today

These shares are having a good time on hump day. But why?

Read more »

Three small children reach up to hold a toy rocket high above their heads in a green field with a blue sky above them.
Share Gainers

3 ASX 300 shares going gangbusters on Wednesday

Investors are bidding up these three ASX 300 shares today. But why?

Read more »

Man raising both his arms in the air with a piggy bank on his lap, symbolising a record high.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a huge Tuesday for ASX shares, with the index resetting its record high.

Read more »

Woman holding gold bar and cheering.
Gold

Why are ASX gold shares rebounding today?

ASX investors are going for gold today.

Read more »

A happy young couple lie on a wooden deck using a skateboard for a pillow.
Share Gainers

Why Meteoric Resources, Resolute Mining, Sonic Healthcare, and TechnologyOne shares are roaring higher

Let's see why investors are getting excited about these shares on Tuesday.

Read more »