This $1 billion ASX lithium stock is in the spotlight today. Here’s why

Another announcement has put Core Lithium Ltd (ASX: CXO) back on traders’ screens on Thursday.

While the share price was seesawing in the morning, it is holding steady during mid-afternoon trade.

At the time of writing, Core Lithium shares are up 4.69% to 33.5 cents.

That comes after a strong run. The stock has lifted about 42% over the past month and is up roughly 380% over the past year.

Let’s take a closer look at what just landed.

Core Lithium locks in lithium fines sale

Core Lithium has entered a deal to sell 20,000 tonnes of lithium fines from its Finniss operation in the Northern Territory.

The company signed a binding agreement with Glencore International AG, with pricing set at around US$290 per tonne, or roughly $405 per tonne.

That puts total proceeds near US$5.8 million, or about $8 million, with funds expected to come through this quarter.

The material is coming from an existing fines stockpile at Finniss, meaning this is not tied to new production.

The shipment will go through Darwin Port using the project’s established logistics chain.

Core also noted it is still working through options for the remaining 55,000 tonnes of fines sitting in stockpiles.

Another step in rebuilding cash flow

This follows an earlier spodumene concentrate sale announced in February, as the company looks to generate cash while broader operations remain paused.

Management has been focused on keeping Finniss ready while waiting for stronger lithium market conditions.

Selling stockpiled material gives Core a way to bring in cash without ramping up full mining operations.

It also helps support liquidity alongside its funded restart plan.

The pricing is based on current lithium fines conditions, with final adjustments to come after the assay results.

Foolish bottom line

Core is gradually clearing inventory and pulling in cash while it waits for better pricing conditions across the lithium market.

Lithium carbonate prices have been trending higher in recent months, which has helped lift sentiment across the sector.

From here, attention turns to how much of the remaining stockpile can be sold, and at what price.

But the bigger question revolves around timing for a full restart at Finniss, and whether current lithium prices are enough to support that move.

Core is effectively turning stockpiles into funding while keeping the operation ready.

I would be watching two things closely. How quickly the remaining fines are sold, and whether conditions are strong enough to bring Finniss back online.

The post This $1 billion ASX lithium stock is in the spotlight today. Here’s why appeared first on The Motley Fool Australia.

More reading

• Why is everyone talking about Core Lithium, Ampol and Santos shares on Thursday?
• Up 444% in a year, what’s moving Core Lithium shares today?
• ASX lithium shares rally as oil shock highlights EV appeal
• This ASX lithium rocket is closing in on a multi-year breakout again
• Why this ASX lithium stock is charging higher after a major breakthrough

Motley Fool contributor Aaron Teboneras 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.