Australia's Lake Resources hits two-year low on lithium carbonate output delay

Lake Resources NL

20/06/2023 05:55

June 20 (Reuters) - Australia's Lake Resources  LKE.AX 
extended losses to slump over 27% on Tuesday, a day after the
lithium developer flagged a three-year delay in the first
production from its Kachi lithium project in Argentina and more
than doubled the cost estimate.
    Lake's shares fell as much as 27.6% by 0421 GMT, hitting
their lowest level since June 16, 2021, and setting the stage
for their worst day since June 21, 2022. 
    The company was also the top loser on the benchmark index
 .AXJO , which was last up 0.9%. 
    Shares had closed 20% lower on Monday after Lake said it has
pushed back the expected first production of 25,000 metric tons
of lithium carbonate to 2027 from the Kachi project and raised
spending estimates to $1.1-$1.5 billion. 
    It had initially planned the first production from Kachi in
2024 at a capital expenditure of $544 million, as outlined in a
2020 report.
    The delay at Kachi is partly because Lake has yet to
finalise a power supply deal with the local government, per the
Chief Executive Officer David Dickson. It is too early to say
what percentage of the grid power would be sourced from fossil
fuels and renewable energy, Dickson added.
    The Kachi project is a test bed for direct lithium
extraction, a new technical process that uses much less water
but has yet to be fully commercialised.
    
    

 (Reporting by Echha Jain in Bengaluru; Editing by Dhanya Ann
Thoppil)
 ((Echha.Jain@thomsonreuters.com;))