E3 Lithium stock hits 2.5-year high as it advances production testing

The stock traded 9% higher at $4.00 apiece as of 12:10 p.m. in Toronto. Earlier in the session, E3’s share price touched $4.04, its highest in two and half years. The company has a market capitalization of $270.2 million.

The share movement comes on the back of E3’s announcement that it has successfully produced lithium carbonate, which is the last major step in the testing process before conversion to battery-quality lithium hydroxide monohydrate (LHM).

The test work used concentrate generated from brines located in E3’s Clearwater project area in Alberta, produced during the direct lithium extraction (DLE) testing completed in preparation for the pilot plant, for which the commissioning process began earlier this month.

E3 currently holds one of the largest inferred lithium resources amongst its peers with 24.3 million tonnes of lithium carbonate equivalent (LCE), hosted in the world-class Leduc Aquifer. Clearwater forms part of this resource area, containing 2.2 million inferred tonnes of LCE at an average lithium concentration of 74 mg per litre.

A 2020 preliminary economic assessment for the Clearwater project estimated annual output of 20,000 tonnes of lithium hydroxide over a 20-year life. Its after-tax net present value (at 8% discount) is estimated at about US$820 million, with an internal rate of return of 27%.

According to E3, it has engaged a major lithium refining technology and equipment vendor to develop the downstream lithium production processes in preparation for the upcoming pre-feasibility study.

The testing was conducted to treat a sample of concentrate, or eluate, produced by DLE technology. The test program has successfully progressed through the coarse purification and concentration phases, and the eluate has been converted into lithium carbonate, the company said.

The final steps include further downstream polishing to achieve the desired purity and then conversion of the carbonate into battery-grade LHM.

As the pilot plant produces more concentrate, the Alberta-focused lithium developer added that it will be creating more carbonate and LHM for commercial development purposes.

“Producing high-quality carbonate from our Leduc brines with a major equipment vendor is an incredibly exciting milestone for the company,” said Chris Doornbos, CEO of E3 Lithium. “While downstream lithium refining processes are already commercially operating, demonstrating the success of these processes on E3 Lithium’s brine provides more certainty for our commercial processes.”