Shares of Chengxin Lithium Group surged after the Chinese battery materials developer said to Yicai today that it is actively applying for part of mining rights regarding a newly discovered lithium ore deposit which is expected to be the largest in Asia.

Chengxin [SHE: 002240] jumped by 6.6 percent to CNY23.64 (USD3.30) as of 2.44. p.m., still over 40 percent lower than 12 months ago.

However, the timeline till mining approval is unpredictable, employees of the Chengdu-based firm said. The discovery can improve Chengxin's self-sufficiency of raw materials but the expected earnings depend on market conditions, they added.

The deposit was found in Sichuan province's city of Yajiang with an estimated sum of nearly one million tons of lithium resources, more than anywhere else in Asia, and Chengxin indirectly holds a share of exploration rights. The spot has proven reserves of 61.1 million tons of lithium ore, including 990,000 tons of lithium oxide, CCTV reported, citing data released by the Sichuan Mineral Resources and Reserves Evaluation Center in August 2023.

Huirong Mining Group, which is 85 percent owned by Qicheng Mining Group, owns the related exploration rights. But Chengxin hiked its shareholding in Qicheng to 43.2 percent from 38 percent last December by paying CNY500 million (USD69.5 million).

Sichuan is rich in lithium ore resources, accounting for 57 percent of China's total, and 158 million tons of such reserves are linked up with mining rights.