Comstock Mining (LODE) - Get Comstock Mining Inc. Report shares more than tripled after the mineral producer unveiled a $10.8 million deal for rights to a stake of as much as 64% stake in lithium battery recycling company Linico.
Comstock shares recently traded at $8.20 after closing at $2.25 on Tuesday. The outsized market reaction reflects investors' mania for anything related to electric vehicles.
Comstock, Virginia City, Nev., will dole out $4.5 million cash and 3 million restricted common shares for the stake in Linico.
As part of the deal, Aqua Metals (AQMS) - Get Aqua Metals, Inc. Report -- the McCarran, Nev., lead producer using environmentally friendly methods -- is investing $2 million for a 10% stake in Linico, which recently bought a battery metal recycling facility in Nevada from Aqua.
“Continued advances in energy storage are inevitable, but no resource is infinite, and most of that lithium will need to be recovered and reused at some point,” Corrado De Gasperis, Comstock’s chief executive, said in a statement.
“We see spent lithium-ion batteries as a potent industrial mineral, and – as with any resource, we need the right team, technology, and infrastructure to extract and process it.
"This transaction assembles all three into an ecosystem of aligned partners, operating systemically on a common goal.”
Further, “Linico plans to commence production later this year [in Nevada], building toward cathode production capacity of about 10,000 tons per year,” Comstock said.
“At just 33% of that rate and 60% of applicable commodity prices, the Linico facility should generate more than $100 million in sales with pre-tax operating income margins exceeding 30%, … making a landmark contribution to Comstock’s environmental, social and corporate governance, product and process stewardship, and climate smart mining goals."
Aqua Metals shares at last check were trading up 24% near $7.50.