This lithium developer could deliver better than 200% upside Shaw and Partners says

Wildcat Resources Ltd (ASX: WC8) has this week reported drilling results from its Bolt Cutter Central discovery in Western Australia, with lithium mineralisation present in all drill holes to date.

The company drilled three diamond holes for metallurgical purposes and is continuing with drilling to hopefully expand the scale of the discovery.

A reverse circulation drilling program is also scheduled to start late in the current quarter, the company said in its statement to the ASX.

Dual deposit development a possibility

The Bolt Cutter prospect is just 10km west of Wildcat’s Tabba Tabba project, for which the company released a prefeasibility study last year, indicating a probable 17-year mine life.

The company said this week that the lithium mineralisation at Bolt Cutter was quite coarse, which could be suited to a different processing method.

As the company explained:

Each of the completed diamond holes intersected mineralisation interpreted to contain spodumene and other lithium bearing minerals. Encouragingly, diamond core samples indicate that some interpreted spodumene crystals are quite coarse, exceeding 100mm in length. While the primary focus of the metallurgical test work is to assess the suitability of the pegmatite for processing through the existing Tabba Tabba flowsheet, due to the observations of coarse interpreted spodumene, the applicability of a dense media separation (DMS) workflow will also be evaluated.

Shaw and Partners have had a look at the results and said in a research note to clients that they were encouraging.

As they said:

Results to date demonstrate strong potential for Bolt Cutter to grow in scale both laterally and at depth. Bolt Cutter is likely to be a key component of Wildcat’s two-pronged strategy of exploration and development, with organic growth from discoveries providing a clear pathway for integration into broader development plans. Wildcat is moving quickly toward production, having made its major discovery on already granted mining leases. This unusual status, combined with a signed Native Title Agreement, significantly truncates the regulatory and permitting timeline, allowing the company to target first production in 2028. This will allow Wildcat to capitalise on the current lithium price cycle as the market moves into deficit later this decade.

Shaw and Partners said the company should be well-placed to be in production in time to feed into what was an “overwhelmingly bullish outlook for lithium demand, fuelled not only by the global transition to electric vehicles, but also by the rapidly increasing power requirements of AI data centres and utility-scale energy storage systems”.

Shaw has a price target of $1.20 on Wildcat shares, compared with the current price of 38.5 cents, which would be a 211.7% return if achieved.

The post This lithium developer could deliver better than 200% upside Shaw and Partners says appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England has no position in any of the stocks mentioned. 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 Scott Phillips.