Pan Asia Metals raises $4.5 million ahead of Reung Kiet lithium PFS
Funds from the private placement will help drive exploration activities at Pan Asia Metals’ Thailand projects.
Pan Asia Metals (ASX: PAM) has announced it has raised $4.5 million through a private placement to drive the company’s exploration and development activities for 2022, including the delivery of a pre-feasibility study (PFS) for the Reung Kiet lithium project in Thailand.
The battery and critical metals explorer today confirmed the placement has concluded with the support of two Thai-based institutional investors and one Australian institutional investor.
At $0.40 per share, the placement was priced at an 8.1% premium to the last closing price of $0.37 and 5.5% higher than the 15-day volume weighted average price of $0.38 per share. Settlement is scheduled for 24 February.
Pan Asia said the funds will be used to continue necessary technical and economic studies required in anticipation of delivering a PFS for Reung Kiet later in 2023.
It will also fund drilling at the Bang I Tum lithium prospect ahead of confirming an exploration target and delivering a maiden mineral resource later this year. Up to 15,000 metres of diamond drilling is planned to test the target as well as recently identified adjacent zones.
Additional activities planned for the year include assessing the potential for standalone midstream lithium chemical conversion opportunities in Southeast Asia and progressing current applications at the Kata Thong geothermal and hard rock lithium project.
Funds will also be used to assess other battery metal project opportunities and for general working capital requirements.
Further opportunities in Southeast Asia
Pan Asia managing director Paul Lock said the support received from the three institutional investors speaks volumes about the company’s projects and its strategy in Southeast Asia, which is expected to “start paying off in 2023”.
“We are conscious of our capital structure and dilution, and note that the placement is for shares only, maintaining Pan Asia’s clean and tight capital structure,” he said.
“The underlying fundamentals for lithium are very strong and we see interesting opportunities in Southeast Asia.”
“Aside from progressing the Reung Kiet lithium project, we will be focusing on potential midstream opportunities, which if successful could see Pan Asia Metals positioned as a leader in the supply of battery metals and chemicals in the region.”
Mr Lock said the company will also assess other battery metal project opportunities with applications already underway.
December quarter exploration
A highlight of the December quarter was the positive assay results received from infill and extensional drilling at Reung Kiet, which returned multiple high-grade intercepts including 29.65m at 0.6% lithium oxide, 20.3m at 0.7%, 8.5m at 1.03% and 3.45m at 1.62%.
At the Bang I Tum prospect, field work identified a new target zone of about 800m by 200m in which a lepidolite-rich pegmatite dyke and vein swarm is interpreted.
As a result, the original target zone supporting the exploration target was enlarged by 200% with some of the highest non-selective rock chips and channel samples reported to date. These included 44 out of 64 samples averaging 1.56% lithium oxide at a 0.3% cut-off, as well as 12 samples grading over 2% lithium oxide with a peak result of 2.62%.
The company has reported a cash balance of $6 million which comprises $1.5 million as at 31 December and the $4.5 million capital raising due for settlement later this month.