Lake Resources Share Price: March Quarter Update [ASX:LKE]

Lake resources [ASX:LKE] released its March quarter results on Thursday.

Lake continues to demonstrate strong interest in the lithium sector, with the lithium developer growing 670% in the past 12 months.

In the past month alone, LKE shares have gained 35%.

Other lithium juniors are also enjoying strong runs. Sayona Mining [ASX:SYA]for example, has increased by 780% in the last 12 months.

But how long can the lithium boom last?


Lake March Quarter Update

In the March quarter report, LKE took the opportunity to summarize recent developments associated with its flagship lithium project in Argentina.

Kachi’s non-binding memorandum of understanding between Lake and the Japanese company Hanwa still stands with 25,000 annual tons of lithium carbonate to be taken over a 10-year term.

Equity investment and additional financial support have been proposed to strengthen the new partnership.

Ford had also signed a memorandum of understanding with LKE earlier this month for a withdrawal of about 25,000 annual tons of lithium from the Kachi project.

General construction will receive funding of A$111 million (US$82 million) in cash, which was flagged for final investment decisions in the update.

A$39 million was raised this quarter from its installation in the market, supported by lithium prices beating benchmark figures – rising from $70,000 to $79,000 per tonne.

Additionally, the Definitive Feasibility Study now supports 50,000 tonnes of lithium carbonate to be produced by the Kachi project.

And UK and Canadian Export Finance have agreed to support around 70% of Kachi’s expanded production targets.

Lake aims to expand production from the Kachi project to 50,000 annual tons of battery-grade lithium carbonate for commercialization in 2024.

The value of the project has been calculated at US$1.6 billion with an annual EBITDA of US$260 million.

Capital cost estimates were US$544 million, calculated at US$4,178 per ton of lithium.

The lithium-brine drillings of Olaroz, Cauchari and Paso were also advanced to maximize the expansion of lithium assets in Argentina.

100,000 tons of lithium per year are expected to reach the market by 2030 thanks to LKE’s TARGET 100 program which supports Argentinian projects.

Hybrid solar energy will now be used in order to achieve a low carbon footprint and reduced operating costs.

ASX LKE Lake Triangle Lithium Projects

Argentinian projects. Source: Lake Resources

Lake Resources Stock Price Outlook

Now that the electric vehicle revolution is firmly in motion and demand for lithium-ion batteries is well established, investors will likely start to expect Lake Resources to shift the focus away from aspiration to execution.

This will involve securing project financing and signing binding levies to boost forward sales.

Recent deals with Ford and Hanwa are positive in this regard, as are financing discussions with export finance agencies.

The era of lithium does not seem to be dissipating yet.

With prices reaching record highs, the biggest concern is supply.

Even Tesla’s Elon Musk flirted with the idea of ​​lithium mining, showing how scarce supply is right now.

If you’re interested in lithium stocks, you might want to read Money Morning’s latest research report identifying three overlooked stocks in the sector.

Access the report — available for free — here.


Kiryll Prakapenka,
For silver morning