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Date : 18/11/2022

Pilbara Minerals (ASX: PLS) Shares Soared On $250 Million Government Funding

With the advancement of its wholly-owned Pilgangoora Lithium-Tantalum Project, Pilbara Minerals Limited (ASX PLS), a lithium-tantalum producer based in Australia, is positioned at the forefront of the rapidly expanding global lithium sector. Pilbara Minerals is already one of the major lithium miners in Australia, but the company has ambitious expansion goals.

Pilgangoora has one of the world’s largest lithium ore reserves. Pilbara Minerals hopes this asset to become a top producer. Pilbara Minerals might play a significant part in this global supply chain, boosting the PLS share price for years to come. Lithium raw material consumption is expected to rise 28% yearly through 2028.

The Pilbara Minerals stock surged on $250 million in government funding.

FY22 Result Highlights For Pilbara Minerals ASX

Pilbara Minerals share price (PLS ASX) soared by 2% to trade at $5.37 on government funding. The current market cap of the company is approximately 16.04 Billion AUD.

ASX PLS Shares News & Analysis

  1. Pilbara Minerals announced revenue of $1.19 billion in FY22, increasing 576% YoY.
  2. Its operating expense of the company was $41.23 million, increasing 60% YoY.
  3. NPAT of the company announced for FY22 is %561.83 million, increasing 1,192% compared to FY21.
  4. The EBITDA of the company was $790 million gaining massively by 24,173%.
  5. At the end of FY22, the company had cash and cash equivalents of $591.74 million, increasing 493%.

 

ASX Pilbara Minerals: Why Is The Pilbara Share Price Rising?

The news released last week combined with the soaring stock market to drive up the Pilbara share price.

Export Finance Australia (EFA) and the Northern Australia Infrastructure Facility (NAIF) are the two organisations that have collaborated to provide the firm with a 10-year loan facility from the Australian government.

It intends to utilise the funds from this financing arrangement to finance the growth of its Pilgangoora Mine Operation in Western Australia’s Pilbara area.

According to the announcement, the EFA and the NAIF have agreed to offer up to $125 million each in funds.

Executives see this investment as proof that the Australian government is prepared to back companies that play a pivotal role in delivering crucial minerals that will help the world migrate to renewable energy sources.

Final agreement on the terms of the facility, the execution of comprehensive financing documentation, and the fulfilment of conditions before financial closing and drawdown are all necessary before the facility may be used.

 

How Will Pilbara Use The Funds? Next Steps For PLS ASX

The projected capital cost of the Pilgangoora Mine operation extension is $103 million, and the expansion is anticipated to yield an extra 100,000tpa of spodumene concentrate output.

The 5Mtpa crushing and ore sorting plant will be built using the money. This will replace the already contracted crushing plant and pave the way for further expansions that may bring the Pilgangoora Operation’s total spodumene concentrate capacity to 1Mtpa for a total investment of $194 million.

 

Remarks From The Pilbara Minerals (ASX:PLS) Chief Executive Officer

According to Dale Henderson, CEO of Pilbara Minerals:

We are delighted to have heard of EFA’s and NAIF’s positive funding decisions. The Australian government’s dedication to the local critical minerals business is shown by its sustained backing of Pilbara Minerals. This Australian firm plays a crucial role in the expanding global lithium supply chain.

 

The Future Of The PLS Share Price

Pilbara Minerals hopes to increase its role in the lithium supply chain, which reflects well for the future of its ASX lithium stocks. However, how the Australian lithium stock and lithium prices develop shortly is a crucial variable. With the rise of electric vehicles, the demand for lithium has skyrocketed. For now, all we can do is wait and see whether there are any short-term effects on the price of lithium and lithium stocks.

In the previous six months, the PLS shares price has skyrocketed – surging as much as 100%.

 

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