The Galan Lithium Ltd (ASX: GLN) share price raced to a record high after it released its proof-of-concept test results.
The results related to the precipitation of battery grade lithium carbonate at its flagship Hombre Muerto West (HMW) project.
Galan claims that it could extract lithium carbonate with 99.88% purity from brine at HMW. This is above the minimum battery grade quality of more than 99.5%.
Image source: Getty Images
Galan share price powers up on promising results
What's more, the consultants hired by Galan to run the test, Ad-Infinitum, believes they can further improve the purity. This in turn will lower operating costs even more as less reagent is required.
The news sent the Galan share price surging 7.7% to $1.04 during lunch time trade when the S&P/ASX 200 Index (Index:^AXJO) added 0.6%.
Other lithium shares are also enjoying a good day, although the Galan share price is miles ahead. The Galaxy Resources Limited (ASX: GXY) share price added 3.7%, Pilbara Minerals Ltd (ASX: PLS) share price advanced 2.4% and IGO Ltd (ASX: IGO) share price gained 2% at the time of writing.
Test result details
Coming back to Galan, this is the miner's first laboratory test on its lithium extraction process. The test feedstock was the high-quality brine concentrate obtained through the evaporation test.
The brine contained >6% lithium and the results also showed the process removed difficult to extract impurities like sulphate, calcium and magnesium.
If the good results can be replicated on a commercial scale, Galan could be the next low-cost lithium carbonate producer on the ASX.
Galan share price capturing imagination of investors
"While this is early days, we are excited to demonstrate this first step as a proof of concept of high purity lithium carbonate while we still have room for improvement >99.88% [Lithium Carbonate Equivalent]," said Galan's managing director, Juan Pablo Vargas de la Vega.
"Importantly, from our studies, Galan's high grade and low impurities brine has demonstrated that we can produce high purity lithium carbonate at a low cost."
ASX lithium shares on fire
Management couldn't have timed the news any better. Investor interest in all things lithium has really powered up recently on expectations that electric vehicles sales will skyrocket.
Merger and acquisition (M&A) activity is also helping fuel interest in the sector. Galaxy and Orocobre Limited (ASX: ORE) are on track to complete their merger next month.
These factors explain why ASX lithium shares have left the broader market in the dust. While the S&P/ASX 200 Index (Index:^AXJO) is sitting on a handsome gain of around 23% over the past year, that's nothing compared to the lithium sector.
The Galan share price enjoyed a near seven-fold increase and the Pilbara Minerals share price skyrocketed by over 400%.
The Galaxy share price isn't far behind with a t far behind with a 360% increase while the IGO share price added 73% over the period.
