St George strikes lithium MOU with cornerstone investor

St George Mining has entered into a memorandum of understanding with Shanghai Jayson New Energy Materials to pursue lithium business opportunities based on the potential of the explorer’s Mt Alexander project.

According to the agreement, the two companies will establish a strategic partnership to consider working together on investment and offtake opportunities at Mt Alexander where St George has discovered high-grade lithium-bearing pegmatites along a 15km corridor near Leonora.

The deal will also include potential funding support for St George to enable business expansion, the acquisition and enhancement of new lithium exploration projects in addition to the development of downstream lithium assets in Western Australia. The agreement also outlines a first right of refusal for Jayson to secure at least 20 per cent of the offtake from Mt Alexander and any joint venture projects.

The memorandum of understanding has an initial term of two years, is non-binding and non-exclusive until a formal agreement has been signed and only applies to project tenements wholly owned by St George.

Earlier this week Jayson provided a $2 million cornerstone commitment to St George as part of the explorer’s placement to raise more than $7 million. A total of 105,941,190 shares at $0.068 per share will be issued under the placement to raise $7,204,000 that will be used for exploration and development activities at Mt Alexander, further exploration at St George’s other projects and for working capital.

The explorer says Jayson is a significant supplier to the emerging clean energy sector and the world’s leading producer of cathode precursor materials for lithium-ion batteries. The deal now links St George with prominent players in the global lithium battery supply chain space. This includes Feng Liang who is the major shareholder and chairman of both Jayson and PUTALAI, a global leader in the field of lithium-ion battery anode materials, whilst Zeng Yuqun is the major shareholder and chairman of CATL, the world’s leading manufacturer of lithium-ion batteries and a co-investor with Jayson in mineral projects.

St George Mining Executive Chairman, John Prineas said: “Our strategic relationship with Jayson will strengthen our capacity to advance Mt Alexander and unlock the full potential of our large landholding in this new lithium province in Western Australia, the world’s best hard-rock lithium address.”

The explorer is currently conducting a maiden drill campaign at the site where a total of 10 holes have been completed so far across 945m with two significant target areas identified for ongoing drilling. Multiple pegmatite intervals have been intercepted up to 13m thick from surface with lithium-bearing minerals visually identified in drill chips from the current 20-hole campaign. A second hole recorded a 7m pegmatite interval whilst four more drill holes recorded pegmatite hits at 5m in width.

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