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Liontown Resources buoyed by long-term demand forlithiumSunday, June 30, 2019 5:00 PM HATBy Anthony Barich Market Intelligence

Lithium hopeful Liontown Resources Ltd., which is developing its Kathleen Valley project in Western Australia, has seenits stock surge 340% year-to-date on the commodity's longer-term prospects amidst the global drive to build electricvehicles.

This comes as lithium producers, such as Galaxy Resources Ltd. and Pilbara Minerals Ltd., have been hit bybottlenecks at battery makers to which they supply, which is believed to be causing shipment delays.

Liontown's ASX share price has gone from 2.6 Australian cents per share Jan. 2 to an all-time high of 12 cents on June17 before deflating to 9.7 cents June 27. Research firm Austex said in a June 27 note Liontown's stock had soared340% year-to-date, while Chile-focused lithium explorer BMG Resources Ltd. had risen 71% and North America-focusedPiedmont Lithium Ltd. 74%.

Managing Director David Richards said his company is fortunate not to be in production yet given that battery makersseem to be not ready for the spodumene currently in the market.He also believes the high level of activity in the battery metals market, including Wesfarmers Ltd.' acquisition of KidmanResources Ltd. and globally significant producers making bigger inroads into Western Australia, are also playing toLiontown's advantage.

Given a major South Korean battery maker told him during a recent visit it wants to increase its production from 2gigawatts worth of batteries to 100 GW by 2025, Richards said the high lithium grades and outcropping nature of thepegmatites at Kathleen Valley, on granted mining leases, makes Liontown attractive.Liontown also expects to double its 21 million tonne resource in an update set to be announced in a fortnight, withupside expected from expanding its exploration target to between 19 million tonnes and 31 million tonnes.