Galan Lithium nears financing deal for HMW project amid growing investor interest

Galan Lithium (ASX: GLN) is closing in on securing financial support for its 100%-owned Hombre Muerto West (HMW) lithium brine project in Argentina.

With strong development progress continuing at HMW, the company has further advanced its financing process with the shortlisting of partners and financiers after a period of negotiations.

The company reported that discussions are close to concluding on a definitive sales agreement and financing in the near term, inclusive of non-dilutive options.

Development interest

The company said its development successes at HMW have enabled it to access a broader range of options as it wraps up its negotiations.

Galan has reported that its HMW Phase 1 lithium inventories are continuing to increase in the ponds, currently at 3,200 tonnes of lithium carbonate equivalent (LCE).

The company has also been successful in connecting new piping from the central northern part of the HMW project, leading to an increase in pond flow by up to 50%.

In addition, the latest batch of liners has arrived on site for the installation process for Pond 4, and Pond 5 earthworks are now 80% complete.

Phase 2 permit

The company is also close to wrapping up its permitting for HMW Phase 2 production thanks to strong provincial government support.

The granting of these permits is another key milestone for Galan as it proceeds with the four-stage development of its HMW and Candelas projects, now expected to be within H2 2025.

The projects’ ultimate target is annual Phase 4 production of 60,000 tonnes of LCE by 2030.

Asset offer

These developments come less than a week after Galan attracted global headlines on reports of a proposal to acquire the company.

In responding to an article in a major financial newspaper, Galan said it had not received a takeover bid but rather an unsolicited, non-binding indicative conditional proposal from Energy Exploration Technologies (EnergyX) to acquire its Argentinian lithium assets.

The proposal – related to Galan’s holdings in Salar del Hombre Muerto and Candelas – was for US$50 million in cash and common shares in EnergyX valued by EnergyX at US$50m.

Galan has now confirmed it will not proceed with the proposal but noted the offer was a positive indication of the increasing interest shown in the HMW and Candelas projects.