Matter recovered from lake — wild about that! (7)
I believe the answer is:
salvage
'matter recovered from lake wild about that' is the definition.
Although both the answer and definition are singular nouns, I cannot see how they can define each other.
'lake wild about that' is the wordplay.
'lake' becomes 'L' (geographical abbreviation).
'wild' becomes 'savage' (similar in meaning).
'about that' means one lot of letters goes inside another.
'l' going inside 'savage' is 'SALVAGE'.
Can you help me to learn more?
(Other definitions for salvage that I've seen before include "Rescue (of) ship, etc" , "Rescue (lost cargo)" , "Collect discarded material" , "Rescue (and recycle?)" , "Retrieve (goods) from wreck" .)