Core Lithium (ASX:CXO) shares gain 81% in six months; is this the reason?

August 26, 2022 10:49 AM AEST | By Khushboo Joshi

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Core Lithium (ASX:CXO) shares gain 81% in six months; is this the reason? — Image source: © Gavinp101 | Megapixl.com

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Highlights:

Core Lithium shares have gained more than 322% on ASX in last one year.

The company, famous for its lithium projects like the Finniss Lithium Project, has been on investors’ radar for long now.

Core Lithium has also been in news for signing a Term Sheet deal with American multinational electric car maker Tesla.

Shares of ASX-listed Lithium mining firm Core Lithium Ltd (ASX:CXO) has appreciated over 81% in last six months on ASX.

And in last one year, the shares have gained whopping 322.73%. The company also keeps buzzing in news for different reasons whether it is for signing binding term sheet with Tesla or for obtaining Major Project status from Federal Government for its Finniss Lithium Project.

Besides the share price appreciation, Core Lithium has garnered huge investors’ attention for its various projects, DFSs (Definitive Feasibility Study) and test works.

What is behind Core Lithium’s share price rise?

According to Core Lithium, it is on course to be Australia’s next lithium producer as it is developing a capital-efficient and low-cost spodumene lithium projects – Finniss Lithium Project. This is located near Darwin Port in the Northern Territory in Australia.
Core Lithium presented a DFS and scoping study on Finniss in 2021 as per which the company would be producing 173,000tpa of high-quality lithium concentrate at a C1 Opex of US$364 per tonne and AU$89m Capex via simple DMS processing of some highest-grade lithium mineral resources. Core Lithium also informed that it has an initial mine life of ten years.
From the same Finniss Project, lithium spodumene concentrate will be supplied to Tesla under a legally binding Term Sheet deal between the two firms. As per the agreement reached between Core Lithium and Tesla, the former will supply up to 110kt of spodumene concentrate to Tesla over four years. On its part, Tesla has agreed to support Core Lithium in development of lithium chemical processing capacity.
Australian government has given Major Project Status (MPS) to Finniss Lithium Project. MPS is Fed government’s recognition of the strategic significance of a project to the country. Benefits include extra support from the Major Projects Facilitation Agency, single-entry point for Aussie government approvals and state and territory approvals.
Core Lithium has also acquired right to multiple pegmatite mines alongside Finniss Project. The company has signed an option agreement to takeover six granted Mineral Leases. These are located just close to the Finniss Lithium Project.
On 15 August 2022, Core Lithium provided an update on its exploration activities which mentioned that diamond drilling is underway at BP33. Also, a 40,000m RC drilling is on split between greenfields and brownfields. The announcement by Core Lithium added that two applications have been approved by Grants NT for co-funding in Round 15 of the Northern Territory Geophysics and Drilling Collaborations program. Also, the company mentioned it has started exploring gold besides lithium at Finniss.
On 5 August 2022, Core Lithium informed that it has appointed a new CEO in Gareth Manderson who will be succeeding Stephen Biggins.

Meanwhile, on Friday (26 August 2022), shares of Core Lithium were trading 0.358% up at AU$1.400 per share at 10:51 AM AEST on ASX.

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