Ongoing surpluses in the lithium market continued weighing down prices and impeding the sector’s growth throughout 2024.
A broad consolidation prompted analysts to declare that prices have bottomed, signaling a potential recovery ahead.
According to a Sprott Insights report from late July, a lithium shortage could materialize in 2025 and will be exacerbated by the lack of new production able to ramp up quickly.
“There are currently only 101 lithium mines in the world, and even as more mines and exploration projects come online, the added supply may likely not be able to keep up with demand,” Jacob White wrote.
Demand from China alone is projected to climb by nearly 20 percent annually over the next decade.
The impact of lithium shortages may also be heightened by the low-price environment that has plagued the market in 2024.
“This is especially evident given that the current unsustainably low lithium prices have led to project curtailments and driven some miners to reduce capital expenditures and investments in future supply,” White noted. “We believe that the lithium price may have bottomed, and higher lithium prices may be necessary to incentivize the required future production.”
1. Q2 Metals (TSXV:QTWO)
Year-to-date gain: 220 percent
Market cap: C$106.11 million
Share price: C$0.80
Exploration firm Q2 Metals is exploring its flagship Mia lithium property in the Eeyou Istchee James Bay region of Québec, Canada. The property contains the Mia trend, which spans over 10 kilometers. Also included in Q2 Metals’ portfolio is the Stellar lithium property, comprised of 77 claims and located 6 kilometers north of the Mia property.
In 2024, Q2 Metals also focused on exploring the Cisco lithium property, which is situated in the same region. On February 29, the company entered into three separate option agreements to gain a 100 percent interest in Cisco. The news caused its share price to skyrocket, reaching a Q1 high of C$0.54 on March 4.
Q2 Metals closed the acquisition of Cisco in June and now wholly owns the project.
In mid-May, the company announced the start of a summer drill program at the Cisco property. It has since released multiple significant updates, including the confirmation of eight new mineralized zones on July 8.
On October 1, Q2 released assays from the drill program, and its share price spiked on the news, ultimately climbing to an all-time high of C$1.48 on October 11.
“These assays continue to validate the potential and scale of the Cisco Property as that of a larger mineralized system,” said Neil McCallum, vice president of exploration. “One important observation of these results is the higher-grade nature of the larger mineralized system as we test and track the system progressing to the south.”
By the end of the drill program, the company had drilled 17 holes covering 6,360 meters in total, and it released the final results from the campaign on December 17.
As of mid-December, Q2 now has the exclusive right to acquire a 100 percent interest in 545 additional mineral claims, which would triple its land position at the Cisco lithium property. The new claims, located south of the original property, enhance prospects for development and future mining infrastructure.
2. Power Metals (TSXV:PWM)
Year-to-date gains: 73.08 percent
Market cap: C$67.57 million
Share price: C$0.45
Exploration company Power Metals holds a portfolio of diversified assets in Ontario and Québec, Canada.
In late February, Power Metals commenced a winter drill program at its Case Lake property in Northeastern Ontario. The program was designed to expand and define lithium-cesium-tantalum (LCT) mineralization, building on previous work that revealed high-grade lithium and cesium mineralization.
Company shares rose to an H1 high of C$0.47 at the end of March coinciding with news that Power Metals had staked the 7,000 hectare Pelletier project, consisting of 337 mineral claims in Northeast Ontario. According to the company, the project features LCT potential, with peraluminous S-type pegmatitic granites intruding into metasedimentary and amphibolite formations.
During Q4, Power Metals identified a new pegmatite zone at Case Lake through soil sampling. The samples from the zone, located north-northwest of its West Joe prospect, revealed elevated levels of cesium, tantalum, lithium and rubidium, highlighting promising drill targets for the winter program.
The company has also launched its Phase 2 drone magnetic survey, to refine its structural model for critical mineral targets at West Joe and the Main Zone ahead of 2025 exploration efforts.
In a December 10 exploration update, Power Metals disclosed that its partner Black Diamond Drilling, a First Nations owned drilling company, had completed a total of 16 drill holes for 971 meters of the planned 2,000 meter program. Environmental studies are also ongoing.
Shares rose over the following week to a year-to-date high of C$0.49 on December 16.
3. Lithium Chile (TSXV:LITH)
Year-to-date gains: 45.28 percent
Market cap: C$163 million
Share price: C$0.77
South America-focused Lithium Chile owns several lithium land packages in Chile and Argentina, including its Salar de Arizaro property in Argentina.
On April 9, Lithium Chile announced a 24 percent increase in the resource estimate for Salar de Arizaro. The new total for the project is 4.12 million metric tons (MT) of lithium carbonate equivalent, categorized as follows: 261,000 MT in the measured category, 2.24 million MT in the indicated category and 1.62 million MT in the inferred category.
Not long after, on April 18, the company reported the creation of two wholly owned Canadian subsidiaries — Lithium Chile 2.0 and Kairos Gold — as part of a spinout to separate its Chilean and Argentinian assets.
Lithium Chile will retain its Argentinian lithium projects, and transfer its 111,978 hectares of Chilean lithium properties to Lithium Chile 2.0 and its portfolio of gold assets in Chile to Kairos Gold.
In a July operational update for the Salar de Arizaro project the company highlighted that a drill hole encountered ‘a brine-rich, sandy formation encountered from 161 to 500-metres.’
An August announcement provided an update, noting the spin out of Lithium Chile 2.0 was reliant on finalizing a strategic deal for the company’s Arizaro property. As for Kairos Gold, its spin out was effective on December 4.
In mid-December, Lithium Chile penned a letter of intent to sell its 80 percent stake of the Argentinian Arizaro lithium project.
While Lithium Chile did not disclose the buyer it was noted that the buyer “is a large, Asian based company founded over two decades ago (and) a diversified enterprise with significant interests in mining, renewable energy, and technology sectors.”
The move to sell its flagship asset signals a significant step in the company’s strategic realignment. Although company shares reached a year-to-date high of C$0.88 in March, the recent sale news has pushed shares into the C$0.80 level.
4. Volt Lithium (TSXV:VLT)
Year-to-date gains: 26.09 percent
Market cap: C$47.53 million
Share price: C$0.29
Volt Lithium is a lithium development and technology company aiming to become a premier North American lithium producer utilizing its unique technology to extract lithium from oilfield brine.
On April 29, Volt announced a strategic investment of US$1.5 million by an unnamed company operating in the Delaware Basin in West Texas, US. This investment is earmarked for the deployment of a field unit to produce lithium hydroxide monohydrate using Volt’s proprietary direct lithium extraction (DLE) technology.
The company’s share price retreated in the second half of Q2, but July 17 news that Volt increased its processing capacity at its operations in Alberta, Canada, by 100 fold to 96,000 liters per day caused its price to shoot up more than C$0.08 during trading that day.
An August announcement from Volt highlighted the deployment and subsequent production scale up of Volt’s DLE technology in the Permian Basin. The field unit’s processing capacity had been increased to 200,000 liters, or 1,250 barrels, of oilfield brine per day on location in West Texas.
At the end of Q3, Volt achieved first lithium production in the Permian Basin. Shares of Volt reached a year-to-date high of C$0.49 on September 26, the day of the announcement.
“Achieving first lithium production establishes Volt as a leader in direct lithium extraction from North American oilfield brines and marks the Company’s strategic shift from development to production,” said Alex Wylie, the company’s president and CEO.
During the fourth quarter the company raised C$6.2 million through a two-tranche private placement.
In mid-December Volt partnered with Wellspring Hydro to test its proprietary DLE technology in North Dakota, US. The field study aims to evaluate the feasibility of extracting lithium from oilfield brine in the Bakken formation.
Volt also released another update on its field operations in Texas, where it had increased processing to more than 2,500 barrels per day. In January 2025, the company expects to commission its next field unit, which will process up to 10,000 barrels per day.
5. Nevada Lithium Resources (CSE:NVLH)
Year-to-date gains: 14.89 percent
Market cap: C$62.9 million
Share price: C$0.27
Mineral exploration and development company Nevada Lithium Resources is focused on advancing its flagship Bonnie Claire lithium-boron project, located in Nye County, Nevada, US.
In January, Nevada Lithium released the results of a previously conducted seismic survey. The findings identified “a major north-south-trending fault zone as a target for lithium brine exploration.”
At the beginning of Q2 the company reported the commencement of the updated preliminary economic assessment for Bonnie Claire. Additionally, the company also noted “positive” results from test work on the proposed hydraulic borehole mining method that is being considered for the project.
The company also released several drill hole updates throughout the year highlighting the potential of its asset.
In mid-December, Nevada Lithium filed its mineral resource estimate for Bonnie Claire’s Lower and Upper Zones, which featured significantly increased tonnage and grades. The project’s Lower Zone hosts an indicated resource of 275.85 million metric tons grading 3,519 parts per million lithium and 8,404 parts per million boron.
The company announced on December 27 that it is commencing trading on the TSXV on December 31. The news sent shares to a year-to-date high of C$0.27 that day.
Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.