Lithium Australia (ASX:LIT) share price leaps 6% on Bunnings update

Lithium shares are charging up…

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The Lithium Australia NL (ASX: LIT) share price is powering ahead during mid-afternoon trade today. This comes as the lithium company provided an update on its negotiations with Bunnings Group Limited (Bunnings).

At the time of writing, the lithium company’s shares are up 6% to 13 cents.

What did Lithium Australia announce?

In a statement to the ASX, Lithium Australia advised that Envirostream and Bunnings have signed a supply of services agreement. Lithium Australia holds a 90% interest in on-shore battery recycling company, Envirostream.

The deal will see the collection of spent batteries from Bunnings stores in Australia and selected stores in New Zealand. This follows the successful trials of spent-battery collection services in several Bunnings stores within Victoria.

Notably, the agreement comes ahead of the launch of the Battery Stewardship Scheme (BSS). Australia’s Battery Stewardship Council (BSC) is planning to roll out the initiative in early 2022. It is expected to continue until June 30 2024, with Bunnings given the option to extend the agreement for a further 12 months.

In addition, Envirostream will provide a Battery Product Stewardship program at all relevant sites across Australia and New Zealand. This will cover all the requirements of the BSS for managing every type of battery. As such, the services are listed below:

  • Provision and maintenance of suitable collection units for spent batteries;
  • Collection and transportation of spent batteries from all Bunnings sites;
  • Recycling of the spent batteries collected from Bunnings sites;
  • Education and participation in marketing campaigns, in conjunction with Bunnings, and
  • Reporting.

Recently, the Australian Federal Department of Agriculture, Water and the Environment issued Envirostream with a Basel Import Permit. This allows for the import of 100 tonnes of mixed-waste batteries into Australia from New Zealand.

The permit authorises Envirostream to service the Bunnings’ New Zealand stores, which is valid until October 14, 2022. Once imported into Australia, the waste will be recycled at Envirostream’s EPA-licensed Campbellfield facility and Laverton North facility. The latter is currently in development.

Management commentary

Lithium Australia managing director Adrian Griffin commented:

The Company is pleased to announce that Envirostream will commence a service contract with Bunnings, which is leading the way in the provision of convenient collection points for spent batteries ahead of the BSS.

The creation of such a collection infrastructure is vital to improving Australia’s battery recycling rate and preventing spent batteries from being consigned to landfill.

Lithium Australia share price summary

Over the past 12 months, Lithium Australia shares have surged nearly 160%, with year-to-date up more than 100%.

Lithium Australia commands a market capitalisation of roughly $132.38 million and has close to 1 billion shares on hand.

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