The biggest ASX lithium shares are all edging higher in late morning trade.
But one small-cap lithium stock is leaving them far behind.
Shares in European Lithium Ltd (ASX: EUR), with a market cap of some $143 million, are soaring 18% at the time of writing, having earlier posted gains of more than 34%.
This comes after the ASX lithium share emerges from yesterday's trading halt, which it requested "pending an announcement regarding offtake arrangements."
That announcement was released this morning when European Lithium reported on a deal with Bayerische Motoren Werke (ETR: BMW).
And ASX investors have taken note.
ASX lithium share rockets on agreement with BMW
European Lithium reported it has signed a non-binding memorandum of understanding (MOU) with BMW, securing its first offtake of battery grade lithium hydroxide (LiOH).
The MOU will see European Lithium and BMW cooperate in negotiations for "suitable commercial terms" for BMW to purchase LiOH from the ASX lithium share. BMW will have the first right to purchase 100% of the LiOH produced from the identified resources.
Commenting on the MOU, Tony Sage, European Lithium chair, said, "Securing our first offtake with BMW AG is another key milestone for the company. Partnering with BMW AG is an ideal fit for EUR".
European Lithium said no assurance is given that the non-binding MOU will progress to a binding contract.
Should the parties agree to a binding contract, BMW will pay US$15 million upfront. European Lithium will repay that through equal set offs against the LiOH it delivers to BMW.
The ASX lithium share said it will use the proceeds from the prepayment to develop its Wolfsberg Project. That includes supporting the commencement of the construction phase.
European Lithium stated:
Securing its first offtake is a key milestone allowing the company to focus on the final steps of development and implementation of the Wolfsberg Project while it looks to the future and builds a portfolio of prospective battery metals projects located in Europe.
How has European Lithium been performing?
Though European Lithium has struggled this year, down 31% in 2022, the ASX lithium share remains up 60% over the past 12 months.
For some context, the All Ordinaries Index (ASX: XAO) is down 7% since this time last year.
