The Lake Resources N.L. (ASX: LKE) share price has been a positive performer on Tuesday.
In morning trade the lithium-focused mineral exploration company's shares were up as much as 6% to 34.5 cents.
The Lake Resources share price has since dropped back a touch but is still currently up over 2% to 33.2 cents.
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Why is the Lake Resources share price rising today?
Investors have been buying Lake Resources shares following the release of an announcement relating to its exploration activities.
According to the release, the company is accelerating the expansion of its Argentinian lithium projects in response to strong market demand.
Management advised that ~50,000 litres of lithium brine samples are to be sent from Lake's Cauchari Project for testing by groups specialising in direct lithium extraction and the conversion of concentrates to lithium hydroxide.
The company will then undertake a scoping study aiming to expand its future production. After which, Lake Resources is planning to commence pre-feasibility study work at Cauchari later in 2021.
Demand overwhelming supply
Lake Resources' Managing Director, Steve Promnitz, notes that demand for high purity, sustainably produced product is expected to increase materially and overwhelm current supply.
He said: "The scale of market demand for a high purity, sustainably produced product is set to overwhelm current supply, as evidenced by the moves by automakers such as Volkswagen and others. Lake continues to engage with a range of market participants, including large companies seeking to test Cauchari and other brines using their own extraction processes, including converting concentrates into lithium hydroxides and other products."
"With a growing supply deficit projected from 2024, Lake sees the need for even greater lithium production and therefore will advance development plans on our other brine projects based on the same production method. Significantly, should we reach our target, Lake would become a globally significant producer with relevant scale and high-quality products, at exactly the right time for the accelerating EV and battery storage revolution," Mr Promnitz concluded.
The Lake Resources share price is up over 300% in 2021.
