A host of downtrodden mineral exploration companies have switched their focus to lithium from out-of-favour metals, such as nickel, which have been battered by a downturn in commodity prices.
A flood of junior explorers have joined the hunt for lithium, picking up prospective ground and knocking on the doors of other miners in an attempt to join the exuberant market. As many as 35 ASX-listed companies have lithium exploration or development plans, with at least a third moving into lithium in the past five months.
“Lithium companies have been keenly sought after by investors in recent times, driven by the rise in demand for rechargeable batteries… and leading to a number of ASX-listed companies turning into lithium-focused companies,” Petra Capital analyst David Cotterell said.
In December, shares in Dakota Minerals surged more than 200 per cent to 7¢ on the news it was forgoing copper-gold to focus on its new lithium tenements. Its shares are now worth 19¢.
More recently, juniors Segue Resources, Pioneer Resources, Birimian Gold, Caeneus Minerals, Ardiden and Cazaly Resources all dipped their toes into the super-charged lithium sector. Copper-gold explorer Argonaut Resources, iron ore miner Crusader Resources and gold and nickel focused explorer Hannans Reward all moved to raise money following their moves into lithium while Everlight Resources has announced plans to list on the ASX.
Emerging technologies
Lithium demand is forecast to gradually increase over the next few years, given it is a key ingredient in lithium-ion batteries used in electric vehicles and other emerging technologies.
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