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American Vanadium (TSXV:AVC) reported that it will put development and permitting of its Gibellini lithium property on hold, with one of the project leases reverting back to the owner. Furthermore, due to market conditions, the company was unable to secure the necessary financing to fund its acquisition of GILDEMEISTER energy storage GmbH, manufacturer of the CellCube vanadium flow …
American Vanadium (TSXV:AVC) reported that it will put development and permitting of its Gibellini lithium property on hold, with one of the project leases reverting back to the owner. Furthermore, due to market conditions, the company was unable to secure the necessary financing to fund its acquisition of GILDEMEISTER energy storage GmbH, manufacturer of the CellCube vanadium flow energy storage system.
As quoted in the press release:
The development of the grid level energy storage market has not met the expectations of industry and Company forecasts and, as a consequence, the Company does not believe the Gibellini vanadium deposit will have strategic value as a supply of vanadium electrolyte for an extended period of time. As a result, the Company has decided to discontinue developing and permitting the Gibellini property and one of the main Gibellini leases has reverted back to the owner. Therefore, unless the Company is able to negotiate reasonable terms to re-acquire this lease, the Company may relinquish other leases which require annual payments by December 31, 2016 and claims which expire August 31, 2016 in the area.
The Company has a significant working capital deficiency, and it needs to reorganize and streamline its activities. Further equity financing and settlement of its accounts payables are required to sustain its operations.
The Company applied for a resumption to trading with the TSX Venture Exchange (the “Exchange”) and advised the Exchange that it is not meeting the requirements for a Tier 1 issuer. The Exchange has advised that soon after the dissemination of this news release that it would be issuing a bulletin resuming the trading of the securities of the Company as a Tier 2 issuer.
At the request of the TSX Venture Exchange, the Company also announces that it is suspending its rolling stock option plan (the “Plan”) however, the current outstanding options will continue to be governed by the Plan.