PERTH (miningweekly.com) – Lithium developer Lake Resources will raise A$20.6-million in a share placement to fund its flagship Kachi lithium brine project, in Argentina.

The ASX- and OTC-listed company on Monday said that it would issue some 125-million new shares, at an offer price of 16.5c each to institutional investors, with one attaching option issued for every two new shares on offer, with an exercise price of 30c each and a two-year expiry.

“This is a transformational moment for Lake and its shareholders. We are excited to secure this support from North American, European and Australian institutional investors to this defining moment of the company’s development,” said chairperson Stu Crow.

“Roth Capital has introduced a number of new investors to Lake who follow the rapidly growing clean tech battery materials sector and will broaden our exposure to international financial markets.”

Lake told shareholders that the company would use proceeds raised to operate the lithium chloride direct extraction pilot plant, in California, commission the demonstration plant on site at Kachi to produce lager samples for potential offtakers, complete the definitive feasibility study for Kachi, along with the environmental and social impact study, and to fund exploration and evaluation studies across all of its projects.

“Securing these funds delivers certainty to deliver the flagship Kachi project through the definitive feasibility study amid the rapid growth of the clean energy sector,” said Lake MD Steve Promnitz.

“This transaction places the company in its strongest financial position ever. Lake will hold in excess of A$25-million following this placement and anticipates a further A$6-million to be added by July as existing options convert.”

A 2020 prefeasibility study estimated that Kachi could produce 25 500 t/y of battery grade lithium carbonate over a mine life of 25 years, with the project expected to cost some $554-million to develop.