Piedmont Lithium (NASDAQ:PLL) stock jumped nearly 23% over the weekend after the mining company got a mining permit in North Carolina. As of early trading this morning, PLL stock is up over 30%.
The company hopes to provide lithium hydroxide from a mine in Gaston County, west of Charlotte.
PLL stock opened April 15 at $15.80 per share, a market capitalization of over $300 million.
The Lithium Gold Rush
Piedmont believes it can extract billions of dollars from its lithium mine. It is a supplier of lithium to Tesla (NASDAQ:TSLA).
Tesla broke ground last year for a lithium refining operation near Corpus Christi, Texas. China currently accounts for 75% of the world’s lithium supplies, but there are also mines operating in Chile and Australia.
Piedmont Lithium wants to inshore production. Its strategy is to mine lithium ore in rock and then take it through a chemical operation to extract lithium hydroxide.
For now, Piedmont remains largely pre-revenue. It lost $21.7 million, $1.14 per share, in 2023 on revenue of $39.8 million. It owns 25% of its North American Lithium project, with Sayona Mining (OTCMKTS:SYAXF), an Australian company, holding the rest. The joint venture predicts that projects due to open in May will dramatically increase production and lower per-unit costs.
Lithium carbonate prices skyrocketed in 2022, but they are now at two-year lows of about $16,000 per ton. Piedmont’s project will likely compete with one in Nevada. There, an Australian company called Ioneer (OTCMKTS:GSCCF) is seeking rights to a site north of Las Vegas.
A major deposit, the McDermitt caldera, was also recently found near the Nevada-Oregon border. Large deposits are also reportedly near the Salton Sea in California.
PLL Stock: What Happens Next?
The lithium gold rush is underway worldwide, but there may be a lot more of it than previously believed. Environmental costs will also have to be addressed.
On the date of publication, Dana Blankenhorn did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
