Core Lithium Ltd (ASX: CXO) shares are catching the eye on Thursday.
In morning trade, the lithium miner's shares are up 5% to 8 cents.
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Why are Core Lithium shares charging higher?
Investors have been bidding the company's shares higher after it released a key update on its restart study for the Finniss Lithium Operation in the Northern Territory.
Core Lithium suspended mining at the Finniss Lithium Operation at the start of 2024 due to weak lithium prices but is now working to reshape the project into a lower-cost, more resilient operation that could be restarted when market conditions are supportive.
Restart study progressing
According to the release, the restart study is on track for completion in the June quarter of 2025.
The study aims to improve productivity and reduce operating costs by optimising the existing infrastructure at Finniss — which has already seen more than $250 million in investment.
Central to the plan is the BP33 deposit, a high-grade, sub-vertical pegmatite body with a current ore reserve of 8.7Mt at 1.38% Li₂O. The orebody lends itself to underground mining using longitudinal open stoping, and updated mine planning work — developed with the help of independent consultants — is targeting a more efficient approach than the previous operating model.
Metallurgical test work has also identified ways to improve lithium recovery and throughput from the existing DMS plant, all without requiring a flotation circuit — which helps keep capital costs in check.
Cutting costs and taking control
Core Lithium has now exited its last remaining operational contracts at the Finniss Lithium Operation, completing the transition to full ownership of the site infrastructure.
The company believes this is a significant move, as it will not only reduce ongoing care and maintenance costs, but also allow the company to implement a new operating model with greater control over future costs and efficiencies.
The total cost of settling these final contractual obligations is $19.5 million, payable in instalments over four months and fully covered by Core Lithium's existing cash reserves.
Final decision still ahead
While the company is making clear progress toward a potential restart, it is worth remembering that no final decision has been made.
The future of the Finniss Lithium Operation will depend on the outcome of the restart study, lithium market conditions, and board approval for a final investment decision. Stay tuned for that!
Core Lithium shares remain down almost 50% since this time last year.
