149% in a month: Essential Metals (ASX:ESS) share price glides higher on lithium update

The mineral explorer has had a great past month.

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Key Points

  • Essential Metals shares are surging in afternoon trade following an update on its Pioneer Dome lithium project
  • The project is “highly prospective” for lithium and is located in WA
  • Essential has signed a new drilling contract to complete a drilling program at the site
  • Essential Metals shares have surged 149% in the last month.

Shares in mineral explorer Essential Metals Ltd (ASX: ESS) are surging 19% higher today following a company announcement on its 100%-owned Pioneer Dome lithium project.

According to Essential Metals, the Pioneer Dome Project is located in the core of Western Australia’s lithium corridor in the Eastern Goldfields, approximately 130km south of Kalgoorlie.

Essential Metals shares have surged 149% in the last month.

What did Essential Metals announce?

The company advised that air-core drilling will follow up on “open or unexplained anomalism” generated from the August 2021 drill programme at Dome North, located in the Pioneer Dome project.

Essential Metals says the Pioneer Dome project is “highly prospective for lithium-caesium-tantalum (LCT) mineral systems” and includes the Dome North Lithium Mineral Resource of 11.2 million tonnes at 1.21% lithium.

It has also signed a new drilling contractor to complete the 13-hole diamond drilling (DD) programme that commenced last year. The company says a drill rig is now on-site and is on track to complete the drill programme by mid-February.

Specifically, the DD programme is targeting “near-surface (oxide/transition) mineralisation at both the Cade and Davy deposits to obtain samples for bulk density measurements and for confirmatory metallurgical test work”.

An environmental baseline survey was also completed and the final report is currently pending. The company stated that “no particularly sensitive flora or fauna were identified” in its report.

With respect to financials, capital expenditures and operating costs for a 1.6 mililon tonnes per annum (Mtpa) concentrator plant have “been received” and will be utilised as a part of a scoping study that is planned to commence by mid-2022 (pending drill assays and metallurgical test results).

Management commentary

Speaking on the announcement, Essential Metals Managing Director, Tim Spencer said:

The more we learn about Dome North, the more excited we are about its future. While we advance the Dome North Resource in terms of testing its extent and improving its confidence level by in-fill drilling and further metallurgical test work, we are continuing with high-quality exploration in and around the Resource as well as across our entire 450km2 of Project tenure.

The Essential Metals share price has now soared 295% in the past 12 months and has gained another 107% in the last week of trading alone.

The author has no positions in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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