Lithium Australia secures $18.2m funding

Lithium Australia has secured an $18.2 million funding package from US institutional investor Arena Investors LP via a multi-tranche convertible note facility, with the proceeds to be spent on developing a lithium processing pilot plant.

Arena is a global investment firm with about $US750 million in assets.

Under the deal, funds will be drawn down in six tranches, beginning with $3 million upon the deed being signed.

The second tranche of $4.3 million is available 45 days after the deed is signed, and the remaining four tranches of $2.7 million can be drawn down every four months.

Arena is also entitled to options in connection with each tranche equal to 40 per cent of the face value of the notes.

The options are exercisable at a price of 130 per cent of the 20-day volume-weighted average price.

Lithium Australia’s SiLeach process has been designed to rapidly digest any silicate mineral.

The process incorporates a means of enhancing the rate of lithium recovery from ore minerals.

The pilot plant has a design output of 2,500 tonnes per annum of lithium carbonate equivalent.

Managing director Adrian Griffin said the new funding would allow the project to go ahead.

“Lithium Australia has previously announced its intention to proceed with the large scale Sileach pilot plant program, and its intention to recommission the Very Small Particle Company cathode pilot plant,” he said.

“The Arena facility is a major element of the funding package required for these endeavours to be successfully implemented.”

Shares in Lithium Australia were down 3 per cent at 16 cents each at 3pm AEDT.