TIDMIRR
RNS Number : 1851K
IronRidge Resources Limited
31 August 2021
31 August 2021
Landmark Investment Conditions Satisfied
Piedmont Increases Stake to 9.9%
Fully Funded to Production
Ewoyaa Lithium Project, Ghana
IronRidge Resources Limited (AIM: IRR, "IronRidge" or the
"Company") is pleased to announce that, further to the announcement
of 1 July 2021, the conditions precedent to the execution of the
binding agreement ("the Agreement") with Piedmont Lithium Inc.
("Piedmont") , have now been satisfied to fully fund and fast track
the Company's Ewoyaa Lithium Project ("Ewoyaa" or "the Project")
through to production.
HIGHLIGHTS:
Ø Conditions precedent satisfied - Piedmont to fully fund and
fast track development of the industry standout Ewoyaa Project in
Ghana for US$102m
Ø Piedmont commits a further GBP720,000 (c. US$1m) and increases
stake to 9.91% via placing of a further 2.88m shares at 25p
Ø Ghana to benefit from becoming the first West African
lithium-producing country
Ø IronRidge increases net cash position to c. US$28m for future
growth initiatives
Ø Exploration, resource drilling and studies ongoing at the
Project
Commenting, Vincent Mascolo, Chief Executive Officer of
IronRidge, said:
"Today's completion marks a pivotal time in IronRidge's
development of Ewoyaa; from initial discovery to being fully funded
through to production.
"We are delighted to be in a position to confidently advance the
Project, whilst working alongside Piedmont towards first lithium
production in Ghana.
"I'd like to thank our new partner Piedmont for increasing its
initial equity investment and demonstrating the clear belief in
Ewoyaa and IronRidge's wider Cape Coast Lithium Portfolio. I look
forward to working with Keith and his team in this exciting period
ahead as we bring the Project towards production.
"This landmark investment showcases and vindicates IronRidge's
successful exploration strategy, and we are excited to deliver
further on the demerged gold projects in our portfolio."
Commenting, Keith Phillips, President & Chief Executive
Officer of Piedmont, said:
"We are pleased to have concluded these transactions and look
forward to partnering with IronRidge to maximize the potential of
the Cape Coast Lithium Portfolio. Ewoyaa is a high-quality asset
with the potential for low capital and operating costs, and the
broader portfolio offers tremendous exploration upside.
"As a Company seeking to accelerate the transition to a
sustainable future, we look forward to providing a pathway to
production at this industry-leading project."
Summary of Commercial Terms
Piedmont to earn-in to up to 50% of IronRidge's Cape Coast
Lithium Portfolio ("CCLP") in Ghana, including Ewoyaa, in the
following stages;
Stage 1: Investment into IronRidge Resource Limited (AIM: IRR)
(c. US$15m)
-- Piedmont has subscribed for 54,000,000 new ordinary shares in
the Company at a price of 20p per share (GBP10.8m; c. US$15m) with
a lock in provision preventing the sale of the Subscription Shares
for 12 months from admission of the Subscription Shares to trading
on AIM.
-- Piedmont has committed a further GBP720,000 (c. US$1m)
increasing its stake to 9.91% via placing of a further 2.88m shares
at 25p.
Stage 2: Regional Exploration and DFS Funding (US$17m)
-- Piedmont to earn up to an initial 22.5% of CCLP at completion of sole funding comprising :
-- US$5m towards an accelerated regional exploration programme
to enhance the current Ewoyaa resource; and
-- US$12m towards completing the Definitive Feasibility Studies ("DFS") for the Project:
o the minimum "DFS criteria" is to deliver a 1.5 million tonnes
per annum ("mtpa") to 2mtpa run-of-mine ("ROM") operation for a
10-year to 8-year life of mine ("LOM") respectively; and
o any cost overruns or savings will be shared equally between
IronRidge and Piedmont.
Stage 3: CAPEX Funding (US$70m)
Piedmont to earn a further 27.5% of CCLP via the sole funding
of;
-- Capex of US$70m for the Ewoyaa Project:
-- to deliver a 1.5mtpa to 2mtpa ROM operation for a 10-year to 8-year LOM respectively; and
-- any cost overruns or savings will be shared equally.
Other key Terms:
-- If the "DFS criteria" of Stage 2 is achieved and Piedmont
elects by mutual agreement not to proceed to Stage 3, Piedmont will
forfeit its Stage 2 interest.
-- Piedmont is entitled to:
-- appoint one director to the IronRidge board on completion
while maintaining an equity interest above or equal to 9% in
IronRidge; and
-- an offtake agreement (see below) for 50% of the annual
lithium spodumene concentrate (SC6%) production.
Offtake Agreement
Piedmont and IronRidge have entered into a binding offtake
agreement for 50% of the Cape Coast Lithium Portfolio's life of
mine spodumene concentrate.
Offtake pricing will be determined via a formula which is linked
to the prevailing price of lithium products, ensuring IronRidge
captures value-add margins.
Subscription & Placing
IronRidge has now allotted and issued a total of 54,000,000 new
ordinary shares to Piedmont (the "Subscription Shares") at the
Issue Price of 20p per Subscription Share.
In addition to the Subscription, the Company has also placed
(the "Placing") 2,880,000 new ordinary shares (the "Placing
Shares") at the Issue Price of 25p with Piedmont Lithium. The
Placing Shares will not be subject to a lock in.
An application will be made to the London Stock Exchange for the
56,880,000 Subscription and Placing Shares which will rank pari
passu with the Company's existing issued ordinary shares, to be
admitted to trading on AIM on or around 7 September 2021
("Admission").
Following Admission, the Company's total issued share capital
will comprise 573,744,246 ordinary shares. The Company does not
hold any ordinary shares in Treasury. When calculating voting
rights, shareholders should use this figure as the denominator for
the calculations by which they will determine if they are required
to notify their interest in, or a change in their interest in, the
share capital of the Company.
Revised shareholdings following Admission
On Admission of the Subscription and Placing Shares, the revised
shareholdings of the Substantial Shareholders and Directors will be
as follows:
Current Subscription Shareholding Percentage
Shareholding & Placing on Admission of enlarged
Shares issued share
capital
Assore Limited 120,016,667 N il 120,016,667 20.92%
-------------- ------------- -------------- --------------
DGR Global Limited 73,022,667 Nil 73,022,667 12.73%
-------------- ------------- -------------- --------------
Piedmont Lithium
Inc Nil 56,880,000 56,880,000 9.91%
-------------- ------------- -------------- --------------
Sumitomo Corporation 31,793,568 Nil 31,793,568 5.54%
-------------- ------------- -------------- --------------
Vincent Mascolo 15,950,000 Nil 15,950,000 2.78%
-------------- ------------- -------------- --------------
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with
the Company's obligations under Article 17 of MAR.
For any further information, please contact:
IronRidge Resources Limited Tel: +61 2 8072 0640
Vincent Mascolo (Chief Executive Officer)
Amanda Harsas (Company Secretary)
www.ironridgeresources.com.au
SP Angel Corporate Finance LLP Tel: +44 (0)20 3470 0470
Nominated Adviser
Jeff Keating
Charlie Bouverat
Liberum Capital Limited Tel: +44 (0) 20 3100 2000
Joint Company Broker
Scott Matheson
Edward Thomas
Kane Collings
SI Capital Limited Tel: +44 (0) 1483 413
Joint Company Broker 500
Nick Emerson Tel: +44 (0) 207 871 4038
Jon Levinson
Yellow Jersey PR Limited Tel: +44 (0)20 3004 9512
Henry Wilkinson
Dominic BarrettoMatthew McHale
Notes to Editors:
About IronRidge
www.ironridgeresources.com.au
IronRidge Resources is an AIM-listed, Africa focused minerals
exploration company with a significant lithium pegmatite discovery
in Ghana, extensive gold portfolios in Côte d'Ivoire and a
potential new gold province discovery in Chad. As announced on 1
June 2021, IronRidge intends to demerge its suite of gold assets
into a separate listed entity.
Ghana
The Cape Coast Lithium portfolio covers some 684km(2) and
includes the newly discovered Ewoyaa Lithium Project with a maiden
Mineral Resource estimate of 14.5Mt at 1.31% Li(2) O in the
inferred and indicated category including 4.5Mt @ 1.39% Li(2) O in
the indicated category (reported in accordance with the JORC Code).
A Scoping Study on the Ewoyaa Lithium Project, announced in January
2021, supports a business case for a 2.0 Million tonnes per annum
production operation, producing an average 295,000tpa of 6% Li(2) O
spodumene concentrate, with life of mine revenues exceeding US$1.55
Billion. The Company has also secured the first access rights to
acquire the historical Egyasimanku Hill spodumene rich lithium
deposit, estimated to be in the order of 1.48Mt at 1.67% Li(2) O
and surrounding tenements. The tenure package is also prospective
for tin, tantalum, niobium, caesium, feldspar, and gold, which
occur as accessory minerals within the pegmatites and host
formations.
Corporate
IronRidge made its AIM debut in February 2015, successfully
securing strategic alliances with three international companies;
Assore Limited of South Africa, Sumitomo Corporation of Japan and
DGR Global Limited of Australia. Assore is a high-grade iron,
chrome, and manganese mining specialist. Sumitomo Corporation is a
global resources, mining marketing and trading conglomerate. DGR
Global is a project generation and exploration specialist.
About Piedmont:
www.piedmontlithium.com
Piedmont Lithium (Nasdaq: PLL) is developing a world-class
integrated lithium business in the United States, enabling the
transition to a net zero world and the creation of a clean energy
economy in America. Our location in the renowned Carolina Tin
Spodumene Belt of North Carolina, the cradle of the lithium
industry, positions us to be one of the world's lowest cost
producers of lithium hydroxide, and the most strategically located
to serve the fast-growing US electric vehicle supply chain. The
unique geographic proximity of our resources, production operations
and prospective customers places us on the path to be among the
most sustainable producers of lithium hydroxide in the world and
should allow Piedmont to play a pivotal role in supporting
America's move to the electrification of transportation and energy
storage.
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