Which junior ASX lithium stock is surging 45% on good news?

Shares in Anson Resources Ltd (ASX: ASN) took off on Wednesday after the ASX lithium company said a demonstration plant at its Green River project had been greenlit.

Major Korean partner

The company said in a statement to the ASX that it had struck an agreement with major Korean conglomerate POSCO for the construction and operation of a demonstration plant at the Green River project in Utah.

Anson shares were trading 45.3% higher on the news at 7.7 cents, with more than 33 million shares changing hands.

The company said further re the agreement:

Under the agreement POSCO committed to setting up its direct lithium extraction demo-plant to extract lithium from brines produced from the Bosydaba #1 well owned by Anson at the Green River Lithium Project. POSCO will be responsible for engineering, construction, operation and maintenance of the facility, while Anson will provide access to property, infrastructure and brine supply. POSCO will pay Anson a facilitation fee of about $7.2 million.

Anson said POSCO was expected to commence operation of the demonstration plant in 2027 and complete the work in 2028.

The two companies would also continue to explore potential cooperation opportunities, “including joint investment in the project, during the operation of the demonstration plant, as outlined in the MoU Agreement”, Anson said.

Racking up wins

The demonstration plant news followed Anson announcing on Monday that its subsidiary A1 Lithium had been admitted as a member of the U.S. Defense Industrial Base Consortium (DIBC), which is a program overseen by the Department of War.

Anson said further:

Membership of the DIBC provides A1 Lithium with enhanced access to U.S. federal agencies, including the Department of Energy (“DOE”) and DoW, and supports engagement on programs focused on critical minerals, advanced manufacturing and domestic supply chain resilience. A1 Lithium has previously submitted applications under several U.S. Department of Energy grant and funding initiatives, which are currently pending, and continues to actively evaluate additional opportunities aligned with the development of the Green River Lithium Project in Utah.

Anson Executive Chairman Bruce Richardson said regarding this announcement:

Admission into the DIBC represents another important milestone for the company and further strengthens its engagement with key U.S. government initiatives focused on critical minerals and domestic supply chain development. The Green River Lithium Project is strategically positioned within the United States and aligns strongly with current federal priorities surrounding secure domestic lithium supply. We look forward to continuing discussions with government agencies and industry participants as we advance our projects toward development.

Anson was valued at $85.8 million at the close of trade on Tuesday.

The post Which junior ASX lithium stock is surging 45% on good news? appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.