Galan Lithium has received firm commitments for an equity raising of $14m
The placement was oversubscribed with strong support from offshore and domestic investors
The equity raising will provide working capital headroom and financial flexibility for the ongoing development of HMW lithium project
Special report: Strong support has been received from offshore and domestic institutional and sophisticated investors for Galan’s $14m oversubscribed placement with funds to be used for development at the Hombre Muerto West project.
Galan Lithium’s (ASX:GLN) flagship Hombre Muerto West (HMW) lithium-brine project in Argentina is one its way to full Phase 1 production with four brine ponds filled to extract its nameplate capacity of 5,400tpa lithium carbonate equivalent (LCE).
That’s part of a four-phase development which, when completed, will produce 60,000tpa LCE.
The company signed a landmark commercialisation agreement with the Catamarca provincial government to allow the sale of LCE concentrate to both domestic and international customers, signalling a sea change in Argentina’s approach to foreign investment.
Fast-tracking development
GLN has now raised $14m at $0.23 per share to fast-track remaining development activities at HMW.
The company will issue 56,521,740 fully paid ordinary shares with the issue price representing a 20.7% discount to the last closing price of $0.29 on 15 May 2024 and a 23.8% discount to the 10-day VWAP of A$0.3018 as at the same date.
New Options will be issued subject to shareholder approval at a general meeting in early to mid-July.
Putting investor funds to work
“We are delighted with the support for the placement and welcome a number of new investors to the register,” GLN managing director Juan Pablo (JP) Vargas de la Vega says.
“In addition, on behalf of the board, I would like to thank our shareholders for their ongoing support.
“We look forward to putting investors funds to work.”
600,000m2 of evaporation area already built
GLN’s HMW asset holds a 7.9Mt LCE at 883mg/l Li resource in Argentina’s slice of South America’s Lithium Triangle.
The area is also home to major lithium brine operations such as Arcadium’s (ASX:LTM) established El Fenix and Sal de Vida and Korean giant POSCO’s Sal de Oro lithium projects.
Pond evaporation and construction at Hombre Muerto West. Pic: Galan Lithium
Roughly 600,000m2 of the evaporation area has been built and is sufficient enough to produce ~2400tpa LCE, and based on brine flow rates and Li grades, HMW remains on track to start production in H1 2025.
The lithium developer is also analysing options to reduce capex through lowering construction costs and rental options for energy supply and using independent smaller control systems for its facilities.
This article was developed in collaboration with Galan Lithium, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
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