Guess which ASX iron ore share rocketed 40% on Monday

Shares in this ASX mining company soared on the market today.

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Key points

  • This ASX iron ore share gained nearly 42% today 
  • Flinders Mines provided news on an iron ore project in Western Australia
  • In the past month, this company's share price has lifted 50% 

The S&P/ASX 200 Materials Index (ASX: XMJ) closed 1.94% higher today, but one ASX iron ore share left it in the shade.

The Flinders Mines Ltd (ASX: FMS) share price soared 41.51% today to close at 75 cents.

Let's take a look at why this ASX iron ore share had such a good day.

Iron ore development news

Investors bought up Flinders Mines shares after the company advised a farm-in agreement with BBIG Group Pty Ltd had been terminated.

This will enable Flinders to negotiate a staged development of its Pilbara Iron Ore Project in Western Australia.

Stage one will involve a lower volume, near-term trucking operation to "take advantage of iron ore prices" and provide cash flow.

Flinders will also keep looking into stage two, a higher volume operation involving the use of rail, road, and port.

Commenting on the news, Flinders chair Cheryl Edwardes said:

The FIA termination provides Flinders with a more certain pathway to near term cashflow as we attempt to capitalise on current iron ore prices and pursue a less capital intensive, nearer-term mining and logistics solution.

Flinders said there will be one final shortfall payment of about $10 million.

Share price snapshot

The Flinders Mines share price has fallen around 15% in the past year. However, year to date, it has surged 32%. The company's shares have gained 50% in the last month alone.

For perspective, the S&P/ASX 200 Materials Index has fallen 7% in the past year.

Flinders Mines has a current market capitalisation of nearly $127 million.

Motley Fool contributor Monica O'Shea 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.

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