The Eastern Iron Ltd (ASX: EFE) share price is entering the stratosphere on Monday following a positive company announcement.
At the time of writing, the iron ore exploration company's shares are up an astonishing 107.69% to 2.7 cents. This pales in comparison to the All Ordinaries Index (ASX: XAO) which is down 0.37% to 7,797 points.
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What did Eastern Iron announce?
Investors are driving up the Eastern Iron share price after the company advised it has executed a Memorandum of Understanding (MOU).
The non-binding MOU was signed with Ya Hua International Investment and Development Co. Ltd, a wholly-owned subsidiary of Sichuan Yahua Industrial Group Co. Ltd (Yahua Group).
Eastern Iron and Yahua Group will form a strategic partnership for the acquisition and development of lithium projects. This includes working together to bring online the Trigg Hill Lithium Tantalum Project located in East Pilbara, Western Australia.
The long-term goal is to establish the supply of spodumene concentrates in Australia and other countries, except China.
Yahua will be granted the first right of refusal for product offtake from any joint venture projects including the Trigg Hill Project.
More on Yahua Group
With a market capitalisation of roughly RMB 36.3 billion (A$7.7 billion), the Yahua Group is one of China's major lithium hydroxide and lithium carbonate producers. The conglomerate engages in the manufacture and sales of civil explosives and lithium salt products.
Yahua Group's existing operations comprise a 43,000 tonne per annum refinery for lithium carbonate, lithium hydroxide and other lithium products.
Yahua is a major shareholder of Core Lithium Ltd (ASX: CXO) and a major offtake customer of Orocobre Ltd (ASX: ORE).
About the Eastern Iron share price
Over the last 12 months, Eastern Iron shares have gradually moved on an upward trend to post a 220% gain. Year to date, the company's share price has accelerated by more than 120%.
Eastern Iron presides a market capitalisation of just $20 million, with approximately 745 million shares on its registry.
