Metalicity turns to battery metals after zinc spin-off
Just one week after bedding down the spin off of its giant Admiral Bay zinc project in W.A, Metalicity is moving ahead rapidly with a number of exploration programs that promise to reshape the company as a force in battery metals.
Last week Metalicity finalised terms for the sale and subsequent Canadian listing of Admiral Bay and a number of its other zinc projects that are to be re-housed in spin-off vehicle Kimberley Mining.
Kimberley Mining is now planning to list on the Canadian TSX-V exchange with the new projects.
The spin-off follows approaches to Metalicity from institutional investors in North America, which highlighted the potential for a re-rating of the value of Admiral Bay if it had more direct exposure to North American equity markets.
Under the terms of sale, Metalicity is set to receive C$20 million in equity in Kimberley Mining and cash payments of up to C$12.5 million.
This includes C$400,000 at the completion of a seed capital raising and C$4 million at the completion of the IPO, scheduled for September. The balance of the cash payments will flow over the next two years, subject to Kimberley hitting agreed share price targets.
While cash from the Kimberley Mining IPO is not yet in the bank, the size and the quality of Admiral Bay and soaring zinc prices have seen Metalicity overrun by global investment banks to complete the broker syndicate for the IPO.
The second part of the company’s strategy is to re-invent itself as a serious battery metals explorer and that strategy is currently underway. It already has support from shareholder Shanghai Metals under an MOU signed last year for offtake, project development and financing.
In an update to the ASX this week, Metalicity reported it was stepping up exploration plans at three of its well placed projects in WA – Pilbara Lithium in the Pilgangoora district, Yerrida Cobalt near Meekatharra and Munglinup North Graphite on the edge of the Albany Fraser Range.
At the Pilbara Lithium Project and the Yerrida Cobalt project, both 100%-owned by Metalicity, new drill targets have been generated with assays due shortly from recent drilling.
Both projects have been subject to only limited systematic exploration and, with only 5% of targets drill tested to-date, they still have significant upside.
At Munglinup North, a first-pass drill program is being prepared to test for extensions of high-grade graphite mineralisation suggested by recent airborne electromagnetic surveys.
CSA Global is developing an exploration program across all three projects and leading a project generation program that could add new opportunities to Metalcity’s portfolio.
Company Managing Director, Matt Gauci, said: “We are strategically refocusing the company to deliver value from our highly prospective and underexplored battery metals projects.”
“Exploration programs have recently been completed with the purpose of generating new drill targets for a more systematic exploration program. The company is concurrently evaluating a pipeline of new additional battery metal opportunities with strong support from battery metals company Shanghai Metals.”
Closing price for the last 90 trading days
Powered by Morningstar ®