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Another Australian miner has found a big lithium deposit, and its shares are roaring

Image: Zenith Minerals.

Shares in Zenith Minerals jumped after the miner reported finding high grade lithium in Western Australia’s Pilbara.

A short time ago, the shares were up 13.5% to $0.042.

Lithium is in high demand globally because it is a key component in batteries for mobile computing, home energy storage and electric cars.

A massive deposit of lithium, also in the Pilbara, was announced yesterday by Pilbara Minerals. The Pilgangoora project is now one of the biggest lithium ore (spodumene) deposits in the world. Whether it will be developed depends on more sampling and research.

Today Zenith announced that samples have uncovered high-grade lithium at its 100% owned Mt Alexander Project, 260km south-west of Karratha in the West Pilbara.

The lithium was found in seven samples from a batch of only 10 known to have been analysed for lithium from the Mt Alexander Project.

The focus at the project has been iron ore but that has been wound back with falling commodity prices. In May 2013, Zenith announced a resource for magnetite iron of 535 million tonnes.

The company now plans more surface mapping and sampling as well as assessing existing drill samples for lithium.

Currently most of the world’s supply of spodumene, a hard rock mineral containing lithium, comes from Greenbushes in Western Australia. Another source in the US, Albemarle, mostly supplies its own needs.

Global average lithium contract prices have risen to $US6,000 per tonne and more recently the domestic spot prices in China have hit $US14,000.

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