Galan Lithium raises $10m for 2021 work program

Galan Lithium Greenbushes South project raises 2021 ASX GLN Thematica Future Mobility
Capital raising funds will primarily be used to advance Galan’s Hombre Muerto West lithium brine project in Argentina.

Galan Lithium (ASX: GLN) today announced it had received firm commitments for a $10 million capital raising from institutional and sophisticated investors via the issue of 20 million shares at $0.50 each.

The raising includes a $4 million contribution by Luxembourg green energy fund Thematica Future Mobility which will become a substantial Galan shareholder on completion of the issue.

Proceeds from the raising will be combined with Galan’s existing cash resources of $4.6 million.

Fund will be primarily used to advance Galan’s flagship Hombre Muerto West lithium brine project in Argentina which has a resource of 2.27 million tonnes at 946 milligrams per litre of lithium.

A preliminary economic assessment of Hombre Muerto West was published late last year and confirms the project as a tier one asset.

The assessment gives the project a pre-tax net present value of US$1.01 billion with an expected capital expenditure of US$439 million to develop the project, which would produce 20,000tpa of battery grade lithium carbonate over 40 years.

As well as Hombre Muerto West, proceeds from the capital raising will fund an initial work program at the recently acquired Greenbushes South project in Western Australia.

Managing director Juan Pablo Vargas de la Vega said the raising would help Galan remain fully-funded through its planned 2021 Hombre Muerto West study costs, piloting and new exploration work.

Greenbushes South lithium project

Galan has acquired an 80% interest in the WA-based Greenbushes South lithium project from Lithium Australia (ASX: LIT) and formulated an initial work program for the underexplored area.

The company has confirmed the project’s “low level of exploration maturity” in a prospective region with potential for along-strike extensions to the south, 200km south of Perth and approximately 3km from the world-class Greenbushes lithium open pit mine owned and managed by Talison Lithium Pty Ltd.

The acquired area is host to a large strike length of the Donnybrook-Bridgetown shear zone which contains the Greenbushes deposit.

There are no available historic drilling results for lithium or lithium pathfinders within the area which also hosts numerous occurrences of beryl, tin, feldspar, tourmaline and mica and potentially indicates lithium-caesium-tantalum mineralisation associated with pegmatites.

Galan’s initial field work program includes mapping, rock chip and soil sampling and will begin over the next few weeks.

Largest hard-rock lithium mine

Greenbushes is currently the largest hard-rock lithium mine in the world and has been operated since 2014 by Talison, which is an incorporated joint venture between Tianqi Lithium Corporation (51%) and Albemarle Corporation (49%).

The mine produces a concentrate of the lithium mineral spodumene to feed mineral conversion plants in WA and China as well as consumers in Europe and North America.

Australian mining company IGO Limited (ASX: IGO) recently signed a deal to acquire a 24.99% stake in Greenbushes from Tianqi.

Work by earlier explorers at Greenbushes recorded the presence of pegmatites – a rock type which may host spodumene – and provides immediate exploration targets for Galan.

Much of this work focused on the discovery of the minerals cassiterite (tin) and tantalite (tantalum), as Greenbushes was at different times mined for these minerals before spodumene (lithium) became the major driver of revenue.

    Join Small Caps News

    Get notified of the latest news, interviews and stock alerts.