Poseidon Nickel Ltd (ASX:POS) has recovered over 90% lithium and 300 parts per million tantalum oxide from preliminary flotation tests on surface pegmatite samples from its Lake Johnston nickel project.
Previously, Poseidon received assay results from 2.80% to 3.85% Li2O in samples from reconnaissance field work.
Though Poseidon remains focussed on developing its nickel assets, the lithium diversification adds an additional opportunity.
Significantly, it might be possible to achieve lithium production quicker than many of its peers given the potential to use the existing concentrator at the project to produce a lithium concentrate.
The project has not only a processing plant, but tailings storage facility and existing approvals.
Poseidon has used drone surveys to identify additional pegmatite outcrops, and has applied for works permits to conduct regional exploration for lithium hosted pegmatites at Lake Johnston.
In April, Poseidon issued 721,154 shares at $0.0416 each in payment for drilling services, and another 20 million shares at $0.0528 to investors to raise funds for its care and maintenance programs.
Poseidon carried $2.53 million in cash as at end-March 2016.
Poseidon shares have rallied 165% over the last three weeks with the potential for lithium production at the project.
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