Insights

The Pilbara Minerals (ASX:PLS) share price surges on resource upgrade

The Pilbara Minerals Ltd (ASX: PLS) share price jumped after it posted a 54% increase in total 2P (Proved and…
The post The Pilbara Minerals (ASX:PLS) share price surges on resource upgrade appeared first on The Motley Fool Australia. –

The Pilbara Minerals Ltd (ASX: PLS) share price jumped after it posted a 54% increase in total 2P (Proved and Probable) ore reserves.

The Pilbara Minerals share price rallied over 3% to $1.94 in early trade when the S&P/ASX 200 Index (Index:^AXJO) is struggling around breakeven.

The miner is also outperforming other ASX lithium shares. The Orocobre Limited (ASX: ORE) share price fell 1.8% to $8.12 and the IGO Ltd (ASX: IGO) share price lost 0.9% to $8.51 at the time of writing.

Resource upgrades powers Pilbara Minerals share price

The discovery of new pegmatite domains, together with integration of the Ngungaju Resource led to the upgrade. Management reported a mineral resource estimate at 30 June 2021 of 308.9 million tonnes (Mt) grading 1.14% Li2O (as spodumene), 105 ppm Ta2O5 and 0.59% Fe2O3 at a cut-off grade of 0.2% Li2O.

Pilbara Minerals share price is also reacting to the upgraded Pilgangoora Lithium-Tantalum Project. Management said increased the contained lithium oxide estimates at the project by 47% to 162 Mt grading 1.2% Li2O, 100 ppm Ta2O5 and 1.0% Fe2O3.

The Pilgangoora project has a mine life of around 26 years. This is based the combined 6.3Mt per annum (Mtpa) operations, consisting of the 1.3 Mtpa Ngungaju process plant and the proposed Pilgan 5 Mtpa expanded process plant.

More growth levers ahead

“The continued growth in Ore Reserves reflected the successful integration of the Ngungaju project area and the highly successful development drilling program undertaken this year,” said Pilbara Minerals’ chief executive Ken Brinsden.

“The quality and scale of the Pilgangoora project confirms Pilbara Minerals as a leading hard rock lithium producer and truly sets the scene for our expansion to 6.3 Mtpa and continued growth beyond that.”

The updated Ore Reserve is based on a pit shell selected at a flat forward commodity price of US$588 per tonne of spodumene concentrate for Central, East and South pits.

The long-term price projection for smaller pits (comprising 6% of Ore Reserve) scheduled for later in the mine life is US$700 per tonne.

Bullish lithium outlook drives Pilbara Minerals share price

ASX lithium shares have strongly outperformed on expectations that global supply cannot keep up with demand.

The rapid adoption of electric vehicles and battery storage is driving this demand. Meanwhile, supply has been slow to play catch up.

Some experts believe this trend will persist over the medium-term. This bullish outlook sent the Pilbara Minerals share price surging over 500% over the past year. The Orocobre share price has tripled in value while the IGO share price gained 105% over the period.

In contrast, the ASX 200 is “only” up 22% over the past year.

The post The Pilbara Minerals (ASX:PLS) share price surges on resource upgrade appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of August 16th 2021

More reading

Why this broker just upgraded the Baby Bunting (ASX:BBN) share price to buy
ASX futures point to rebound today after US stock market lifts

Here’s what happened to the Wesfarmers (ASX:WES) share price in September
5 defensive ASX shares to guide you through the market correction

5 things to watch on the ASX 200 on Wednesday

Motley Fool contributor Brendon Lau owns shares of Independence Group NL and Orocobre Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!