Zinnwald Lithium saw a significant surge in its shares on Friday following a 50% increase in the mineral resource estimate for its flagship project in Saxony, Germany.
Previously targeting an initial production of 12,000 tonnes per annum, the lithium producer now anticipates a production range of 16,000 to 18,000 tonnes per annum of battery-grade lithium from the project.
This update positions Zinnwald as the second largest hard rock lithium project in the European Union (EU) and the third largest in Europe by resource size and contained lithium, according to the company.
The largest hard rock lithium deposit in Europe and the fourth largest non-brine asset globally is the Cinovec lithium project in the Czech Republic, owned by European Metals and state-controlled utility CEZ.
Zinnwald plans to conduct a pre-feasibility study (PFS) in response to the assessment update. The study aims to expand the project further and explore possibilities for a second phase of production. It will also focus on minimizing environmental and community impacts, while evaluating technical test work and trade-offs, said CEO Anton du Plessis. The PFS is expected to be completed by the first quarter of 2025.
The company, in a financially secure position, highlighted its application for grant funding from the German federal and state governments. This move follows an invitation in June under Germany’s new initiative to support climate-neutral and strategically vital technologies. If successful, the project could receive 70% funding from the federal government and 30% from the State of Saxony, which has already expressed support for the battery-chain project.
Located close to Dresden, in a region central to Europe’s chemical and automotive industries, the Zinnwald project aims to produce battery-grade lithium carbonate, lithium hydroxide, and lithium fluoride (Li2CO3, LiOH, LiF).
Despite recent declines in lithium prices due to slowing electric vehicle sales globally and market oversupply, Zinnwald Lithium’s stock rose nearly 5% on the news, closing at 8.2p and giving the company a market capitalization of £38.84 million ($50.4m).
