Up 300% in 6 months! This soaring ASX lithium stock just took a major step to production

Lithium stocks have been on a tear over the past few months.

For instance, take leading ASX 200 lithium miner Pilbara Minerals Ltd (ASX: PLS).

Shares in the company have jumped by 181% since early June, climbing to $3.80 per share at Friday’s close.

And during the same period, fellow ASX 200 mining heavyweight Mineral Resources Ltd (ASX: MIN) has seen its share price more-than-double.

But a lesser-known lithium player has outperformed both mining behemoths.

That company is Global Lithium Resources Ltd (ASX: GL1), an exploration business aiming to bring its wholly owned Manna lithium project to production.

Global Lithium shares have surged by 300% over the past six months, reaching $0.60 apiece at the close of business on Friday.

And this week, the group took a major step to realising its goals of becoming Australia’s newest lithium miner.

Significant lithium project

Manna lies about 100 kilometres east of Kalgoorlie in the globally renowned and infrastructure-rich Goldfields region of Western Australia.

It boasts a mineral resource consisting of 51.6 million tonnes grading 1.0% lithium.

And management believes Manna to be the third largest lithium resource in the Kalgoorlie lithium province.

Earlier this year, Global Lithium notched up two key milestones in its efforts to move the project to production.

In August, it sealed a Native Title Mining Agreement whilst also securing a mining lease from the Western Australian government.

And just this week, the ASX lithium stock took another major step on its path to production.

What happened?

Over the past nine months, Global Lithium has been running a Definitive Feasibility Study (DFS) to gauge the merits of building a mine at Manna.

And on Thursday, it unveiled the results.

According to the company, the study confirmed Manna as a long-life and economically robust lithium asset.

It forecast an initial mining operation spanning 14.3 years, with a payback period of 3.5 years.

The study also envisaged a post-tax free cashflow of about $1.15 billion for the duration of the mine.

Global Lithium managing director, Dr Dianmin Chen, commented:

This DFS underscores the potential for Manna to both create shareholder value and contribute to the world’s lithium supply chain through its robust economics, significant long-life potential and Company’s commitment to invest in and develop projects in Western Australia.

What next for this ASX lithium stock?

Global Lithium will now focus on securing the funding required to build a mine.

Here, the DFS projected capital costs to total nearly $440 million.

It will also look to nail down remaining regulatory approvals ahead of a final investment decision planned for next year.

The post Up 300% in 6 months! This soaring ASX lithium stock just took a major step to production appeared first on The Motley Fool Australia.

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Motley Fool contributor Bart Bogacz 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.