Critical Resources (ASX:CRR) shareholders are enjoying a 11% jump in the company’s share price during lunchtime trades as another thick spodumene intersection is recovered at the Mavis Lake lithium project.
This is the second thick section of spodumene reported at Mavis Lake. An initial section at 40.9m was reported earlier this month; today, the company reports a second at 28.25m.
Spodumene mineralisation is commonly associated with lithium mineralisation, but assay results offering evidence of lithium grades remain pending.
Pilbara Minerals (ASX:PLS), which regularly conducts spodumene auctions, saw record prices logged for the rock at its August auction earlier this month.
Spodumene typically hosts lithium in-situ within outcrops and geological settings; whereas lithium brine is that extracted from lakes. Spodumene has another geological counterpart, called lepidolite, for which downstream processing remains less developed.
Geotechnicalities aside, once the company receives its first batch of assay results from the project, it will be able to move ahead to the next stage of mine development: devising a maiden JORC resource.
A JORC resource (JORC refers to mining legislation in Australia) greatly improves the bankability of a project and allows companies to step up capital raising exercises.
Assay results are likely to come in pieces over the coming weeks and months, as the company continues to wrap up a remaining 2,000m of its 10,000m drill run on-site, with samples from the first 8,000m already with laboratories.
Management notes the company will continue to update the market on its extended drill run as results filter back to Critical Resources.
All in all, however, the true nature of the Mavis Lake project cannot be meaningfully determined in these early stages until assay results are received, which will indicate grade, and allow for early projections of project value.
Investors ought to note delays at assay labs across the entire sector remain the quo.
All things considered, pretty well. Let’s take a surface look at the company’s performance.
1 week returns: up 25.5%
1 month returns: up 43.9%
Year to date (YTD): up 55.26%
1 year returns: up 126.9%
At the end of the June quarter, the company had $8.7m in cash and spent $0.62m on opex.
Critical Resources has a market cap of $87.7m and is ranked 248 of 912 players in the materials sector.
Get the latest news and insights direct to your inbox