Westar Resources (ASX: WSR) shares are down another 24%. WSR shares have now lost the entirety of their 150% speculative jump in this past couple of weeks. A very impressive speculative jump it was too, up 150% or so in all, just about back to the starting point right now. The cause of all of this being, of course, that lithium is the very thing right now. That white gold that is going to feed the electric revolution. But it is exactly that which drives fervour in certain speculations. Even the hint that someone might have a bit of what is fashion can drive prices wild.
Then we might get the actual results of real exploration. A drilling program, say, as at Westar: “Drilling intercepted 143m of pegmatite over the 1,460m drilled across 14 RC holes with 13 holes targeting pegmatite and one hole targeting gold mineralisation. Of the thirteen pegmatite holes drilled, seven intercepted pegmatite with intervals generally wider and shallower than expected. Over half of the total pegmatite intercepted was located in the oxide zone (Table 2), where lithium is interpreted to be depleted.”
That is, there's less of the right sort of rock - pegmatite - than first thought and it also doesn't seem to have much lithium in it. Counts of 0.2% Li and so on do not a lithium mine make.
Westar Resouces share price from ASX
We've talked before about Westar Resources: “Westar Resources (ASX: WSR) shares are up 53% today on the announcement that they've hit thick bands of pegmatites at the Olga Rocks site. It's possible that this is us being excessively cynical when we describe this as hitting rock. You know, drill into the ground and hit rock? Well done lads. That is us being excessively cynical though. Much too much so. For every mining project does have to start with someone checking exactly what type of rocks underlie a particular piece of the scenery. “That's what mining exploration actually is, checking the rocks.” And again about WSR: Westar Resources (ASX: WSR) shares are up another 73% today on a continuation of the speculative fervour surrounding the company. As we reported before about Westar Resources it's possible that people are making too much of the exploration findings.”
As it seems to have turned out here. Westar has a prospect where there is indeed a considerable deposit right next door. Everyone got very excited at the start of drilling, then they found the right sort of rock. But, at least as far as we know right now, the right sort of rock isn't quite right - there seems to be no lithium in it. Or not enough to be economic at least. So that speculative furore collapses and we are back where we were two months back, at around the 4 cents level. Ah well, until the next time, eh?
