Shares of gold and lithium miner IronRidge Resources Ltd (LON: IRR) spiked higher after the company announced that it had found the highest-grade lithium deposits at its Ewoyaa project in Ghana.
The miner found multiple high-grade lithium pegmatite intersections during initial drilling operations, along with the highest grade of 4% lithium oxide over 1 metre from a drilling depth of 62 metres.
The Ewoyaa project is estimated to contain 14.5 million tonnes of 1.31% lithium oxide.
From a technical standpoint, IronRidge’s share price is trading at the upper end of a channel and has just broken above it, indicating that a bullish trend may be beginning. However, past price action indicates that the shares are highly volatile and do not respect prior support, resistance or trend lines.
Therefore, there is no guarantee that we will get a sustained bullish trend after today’s pullback. The fundamental picture is very bullish given that the mine had announced that the estimated lithium resources at Ewoyaa were worth up to $100 million back in January, which could generate significant revenues for the company once mining operations kick off in earnest.
Vincent Mascolo, IronRidge’s CEO, said: “We are very pleased with the ongoing results received, which have confirmed high grades and mineralisation continuity over 400m of the strike, with true mineralised pegmatite widths up to 25m which remains open at depth and along strike to the east,”
Adding:
“We are confident the additional targets will increase resource scale and improve project economics, where we have defined Ghana's first lithium JORC compliant resource.”
IronRidge share price.
IronRidge Resources shares spiked higher then fell, erasing all gains following today’s announcement.