It’s been a wild ride for Core Lithium Ltd [ASX:CXO] shareholders today…
After the stock slumped out of the gates this morning, the shares quickly rebounded. By mid-morning, traders had clawed the stock back into the green, but it didn’t last.
At time of writing, Core Lithium share price is now trading exactly at its previous close of 41 cents, battling to finish the day off on a positive note.
After all, if their freshly released annual report is any guide, investors have a lot to look forward to…
Plenty of progress for a pre-revenue project
For the uninitiated, Core is aiming to develop its Finniss lithium project. A mine that is located just 88 km from Darwin Port. Giving it an ideal location to export into the potentially lucrative Asian markets and beyond.
However, with the project still in an evaluation phase, the immediate priority for Core is proving just how lucrative the mine could be. Something that management has made headway on with their recent Stage 1 DFS, released in July.
The highlight of this early assessment certainly has to be the extremely low capex forecast. With Core confirming that it should need only $89 million to get the project up and running.
Granted, the ongoing costs and expenditure to grow the project will likely require more than that. But that is something that should be more than manageable, provided Core can get an initial build finalised.
And with management going all out to secure the required capital recently, they should be more than fine — particularly with $34 million from offtake partner Ganfeng Lithium, $91 million from an institutional and sophisticated investor placement, and a further $25 million from a share purchase plan.
All Core really needs now is to get everything approved and agreed to.
Which is no doubt why the stock has rallied so strongly in recent weeks. Because as Managing Director Stephen Biggins makes clear, this is a promising project:
‘The quality of our Finniss Project and its long-term prospectivity has been demonstrated through the three stages of the Project, which would see us extending our mine life beyond 10 years and developing our own downstream lithium hydroxide processing infrastructure in the NT.
‘Our long-term plans for Finniss have been validated by some of the world’s most significant lithium producers, most notably of which include our long-standing relationship with Yahua and, as of recently, with the world’s largest lithium producer Ganfeng.
‘Given its low start-up capital requirements, existing infrastructure and proximity to offshore transport services, the Finniss Project is well placed to be a major competitor for ethically-sourced, low-cost and low emission-produced spodumene concentrate, meeting the world’s growing demand for lithium batteries for EVs and other renewable energy technologies.’
What’s next for the Core Lithium Share Price?
Looking ahead, the obvious goal for Core is to get the mine operational as soon as possible. Namely, the planned dense media separation (DMS) plant that will be the crux of Core’s operations.
In the longer term, though, the real goal will be to enable downstream processing on-site. Something that could turn Finniss into a much more compelling and valuable mine, enabling more opportunities for a local industry to get involved in the booming lithium sector.
Again, though, this is something that isn’t likely to be realised in the near future. And as such, is something that investors can look forward to once the mine itself is online.
For the time being, though, despite today’s mixed trading, Core looks to be on the right track…getting ever-closer to becoming yet another prominent Australian lithium supplier.
But they certainly aren’t the only ones!
If you’re looking for more opportunities within the lithium ‘bounce back’, then you need to read our latest report. It’s a detailed overview of what is happening in this extremely exciting sector, right now. Including three stocks that we believe could offer investors the best shot at capitalising on this lithium resurgence.
Check out the full report, for free, right here.
For Money Morning
PS: Our publication Money Morning is a fantastic place to start on your investment journey. We talk about the big trends driving the most innovative stocks on the ASX. Learn all about it here