Aim-listed Savannah Resources has raised £12.5-million for the development of its Mina do Barroso lithium project, in northern Portugal, providing funding for the project through a feasibility study to a final development decision early next year.
The company has raised £11.5-million in cash through an oversubscribed placing of shares at 9p each to new and existing investors and has received a letter of intent from major shareholder al Marjan for a further £1-million.
Savannah CEO David Archer said this week that the fundraising had attracted significant UK institutional shareholder attention, with several material tier-one institutional investors having participated.
The company is fast-tracking the Mina do Barroso project, which it believes has the potential to be the leading European producer of spodumene lithium. A recently completed scoping study outlined an 11-year operation, producing 175 000 t/y of spodumene concentrate at 6% lithium oxide.
The scoping study calculated a pre-tax net present value, applying an 8% discount rate, of $356-million and an internal rate of return of 63%. Initial capital expenditure of $109-million is forecast, with the figure including the feldspar and quartz circuit, but excluding contingencies.