Reedy Lagoon Corporation has successfully raised $3.5 million to fund a drilling campaign to test some alluring conductors within salty underground aquifers in the United States. The ASX-listed company has also acquired Nevada Lithium, an American player that holds three lithium projects in strategically-located parts of America that are approximately 200km from Tesla’s Gigafactory.
Reedy Lagoon Corporation has successfully completed a $3.5m capital raise, which will facilitate drilling of an alluring conductor at the Columbus Salt Marsh lithium brine project located in the United States.
The Melbourne-based junior explorer also announced it had completed the acquisition of Nevada Lithium, a company that holds three lithium projects in Nevada, U.S.A, via its wholly-owned subsidiary, Sierra Lithium.
The ASX-listed company’s entitlement offer saw eligible shareholders stump up $3m for the drilling campaign at Columbus, which is strategically located less than 200km from Tesla’s US$5b Gigafactory in northeast Nevada.
On completion, Tesla says the Gigafactory, which is entirely powered by renewable energy sources, will be the biggest building in the world.
It will produce 500,000 electric-powered cars per year by 2018 and will require today’s entire worldwide supply of lithium-ion batteries to keep up with demand.
Reedy Lagoon issued 80 million shares at 2.5c per share, valued at $2million, to Nevada Lithium vendors to complete its acquisition of the American company.
The acquisition places Reedy in a strategically promising position in Nevada to feed an insatiable global demand for lithium, primarily being driven by electric car technology that is rapidly overtaking internal combustion engine propulsion.
Reedy Lagoon's lithium brine targets are situated in underground salt aquifers that share similar geology with Clayton Valley where North America's only lithium brine producing operation known as Silver Peak is located.
Silver Peak is on the doorstep of the Australian company’s three Nevada projects; Big Smoky South, Columbus Salt Marsh and Alkali Lake North. All three are located within 30km of each other.
According to Reedy Lagoon, geophysical surveys conducted in April and May this year successfully identified lithium brine targets within a number of the underground salt water aquifers. Reedy are working on the theory that the salty brines may also contain lithium that has been deposited there due to historic volcanic activity.
Silver Peak, which is owned by NYSE-listed chemical player Albermarle, produces around 6000 metric tonnes of lithium carbonate equivalent each year.
The Big Smoky South project is only 10km from Silver Peak, the Columbus Salt Marsh project is located about 50km to the north west of Silver Peak and the Alkali Lake project about 30km to the north east.