China end-user secures 10% stake in lithium explorer MetalsTech
A Chinese-based hi-tech fine chemicals manufacturer has anchored a 10% stake in lithium explorer MetalsTech (ASX: MTC) for A$1.8 million.
Via the binding agreement, Shenzhen Stock Exchange-listed Wuxi Baichuan Chemical Industrial will purchase 10 million MTC shares at $0.18 each.
If Wuxi Baichuan Chemical Industrial elects to increase its shareholding in MetalsTech to more than 15% it will be entitled to have a representative on the MetalsTech board.
“This is a game-changing milestone for the company,” MetalsTech executive chairman Russell Moran said.
“Strategic alignment with a lithium-ion battery chemicals producer at this juncture will support us in tailoring our feasibility studies beyond spodumene concentrate production as we look to maximise value and minimise market risk through the investigation of downstream processing opportunities with an experienced technical and financial cornerstone partner,” Mr Moran added.
Focussed on exploring for Lithium and cobalt in Canada, MetalsTech has two key projects: Cancet in Quebec and Bay Lake in Ontario.
A week ago, the company completed a phase two diamond drilling program at its 100%-owned Cancet lithium project which is hoped to underpin a maiden resource.
Initial drilling at Cancet uncovered shallow lithium mineralisation grading between 1.82% and 6.61%.
The mineralisation remains open in all directions, with tantalite also identified in the drilling samples.
A previous mineralogy profiling program at Cancet on 5kg of outcrop samples returned concentrate grade lithium of 6.24%, which is amendable to simple dense media separation processing.
According to MetalsTech, the mineralogy indicates the lithium will meet and exceed battery market requirements.
“These assays support our thesis that Cancet has the potential to host a high-grade lithium deposit very close to the surface,” Mr Moran said.
“Cancet is located only a few kilometres from low-cost hydro-power and an existing regional all-weather road, thus, if sufficient resources are defined, we will be well-positioned with a highly attractive asset to further develop,” he added.