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LITHIUM INVESTING
Top 9 Lithium Stocks of 2023
Lauren Kelly
May 08, 2023

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3. Essential Metals (ASX:ESS)
Investing News Network
Company Profile
Year-to-date gain: 34.85 percent; market cap: AU$115.05 million; current share price: AU$0.445

Essential Metals is a lithium-focused company with its flagship Pioneer Dome lithium project in Western Australia, near Kalgoorlie. The company has two gold projects in that region as well.

Essential’s share price spiked to AU$0.48 early in the year, when the company announced on January 9 that it had entered into a scheme of arrangement with Tianqi Lithium Energy Australia (TLEA), a joint venture between Tianqi Lithium (OTC Pink:TQLCF,SZSE:002466) and IGO (ASX:IGO,OTC Pink:IPDGF). TLEA was looking to acquire 100 percent of Essential for AU$0.50 per share; Essential's board unanimously recommended the deal, and set an April 20 date for a shareholder vote. Essential was trading at AU$0.345 the day before the announcement, and it passed AU$0.50 in the following days.

With regards to progress made at Pioneer Dome, on February 6 Essential announced that a scoping study for the project’s Dome North area “demonstrates the potential viability of a standalone mining and processing operation,” which the company believes supports moving towards more detailed studies. Two weeks later, it was granted a 21 year mining license for the Dome North mineral resource.

In March, Essential released its half-year report for the period ended December 31, 2022, and just over a month later it put out its report for the March quarter.

Although the company’s share price jumped to a year-to-date high of C$0.58 following the quarterly release, it was actually Mineral Resources’ (ASX:MIN,OTC Pink:MALRF) surprise purchase of a 19.55 percent interest in Essential that drove the rally.

A week after its nearly 20 percent interest acquisition, Mineral Resources used its rights to block the scheme between TLEA and Essential Metals. Enough shareholders — including Mineral Resources — ultimately voted against the scheme, resulting in its termination. Essential’s share price has since fallen to sit around C$0.43.