The Liontown Resources Ltd (ASX: LTR) share price has been a strong performer in recent sessions.
For example, since dropping as low as $2.47 last Thursday, this lithium developer's shares have stormed 11% higher.
Why has the Liontown share price been roaring higher?
Investors have been buying this ASX lithium share for a couple of reasons.
One is a rebound in the battery materials industry that has given most lithium shares a lift over the period.
In addition, the company announced a "significant milestone" last week which appears to have gone down well with investors.
This milestone was the company selecting Byrnecut Australia for the underground mining services that will underpin the development and production of the Kathleen Valley Lithium Project.
Liontown's managing director and CEO, Tony Ottaviano, highlights that Byrnecut is a tier one mining contractor with a demonstrable record and capability across the entire underground value chain. He said:
Today marks a significant milestone for Kathleen Valley as we have issued a letter of award for the Underground Mining Services contract to Byrnecut. Byrnecut is a Tier-1 underground mining services contractor with a global footprint. Its underground expertise is highly respected and well recognised throughout the mining industry and investment community, underpinned by the people they attract and retain.
The release notes that the contract is the largest to be awarded by Liontown. It provides the full suite of mining services for its underground operations to support initial plant throughput capacity of 3 Mtpa. It is valued at approximately $1 billion over four years. However, Byrnecut will commit $125 million to procure new plant and equipment to execute the works.
Can its shares keep rising?
The team at Bell Potter believes there's still potential for the Liontown share price to keep rising from here.
According to a note from earlier this month, the broker has put a speculative buy rating and $3.35 price target on its shares. This implies a potential upside of approximately 22% for investors over the next 12 months.
