Dakota Minerals Ltd (ASX:DKO) has commenced the second phase of its drilling programme at the promising Lynas Find Lithium Project in the Pilgangoora region of Western Australia.
The company is aiming to define a maiden resource at the wholly owned Lynas Find Project. The program is expected to last 4-6 weeks.
Initial results from reverse circulation drilling provided confirmation of high grades at Lynas Find.
These included 35 metres at 2.1% LI2O, 35 metres at 1.75% and 40 metres at 1.52% Li2O, and an overall weighted average grade of 1.75% LI2O.
The Pilgangoora region has been in the news in recent times for the discovery of significant lithium and tantalum resources by Pilbara Minerals Ltd (ASX:PLS) and Altura Mining Ltd (ASX:AJM).
The Lynas Find is reputed as the second largest known hard rock lithium deposit in the world, while its known area of mineralization continues to grow. Rock chipping in the vicinity has yielded grades of up to 3.98% Li2O, pointing to the possibility of a repeat of the Lynas Find Central to the South.
The first phase drill results were viewed positively by investors, enabling Dakota to raise $12.3 million (before costs) from a heavily oversubscribed placement of 61.6 million ordinary shares at $0.20 per share. The issue proceeds have been earmarked for subsequent phase drilling. Post-issue cash in hand is estimated at $15.2 million.
Goldman Sachs has declared lithium as the ‘new gasoline.’ A sharp increase in demand, emanating from its use in electric cars and energy storage, has left the lithium market in short supply and is pushing up its price. Demand in 2016 is estimated at 200 Kilo tonnes per annum, up from ~160 kilo tonnes per annum in 2015.
The Dakota Minerals share closed at $0.16 on May 27, and has doubled from its price of $0.08 on April 1, 2016 while it has been a 7-bagger since December 2015.
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