Lithium Power International Limited (ASX: LPI) (“LPI” or the “Company”) is pleased to advise that it has now successfully completed the Plan of Arrangement with joint venture partner Bearing Lithium Corp. (BRZ:TSXV) (“Bearing Transaction”) who held a 17.14% interest in the Maricunga lithium brine project in Chile (“Maricunga”).
HIGHLIGHTS
- LPI has now completed the Bearing Transaction to acquire the final 17.14% interest in Maricunga
- LPI has now consolidated ownership of 100% of Maricunga
As announced on 20 December, the Company completed the merger with Salar Blanco, LLC to acquire the 31.31% of Maricunga which was held by joint venture partner Minera Salar Blanco SpA (“SBD Transaction”) (together with the Bearing Transaction, the “Transactions”).
As a result of the Transactions LPI has now successfully completed consolidation of ownership of 100% of Maricunga. The Company is now well positioned to deliver further value to shareholders as consolidating ownership under LPI:
- provides the optimal ownership structure to oversee the development of Maricunga by streamlining decision making
- simplifies and de-risks the funding pathway for Maricunga which will enhance the Company’s ability to source capital from a wider range of providers to fund development in the lead up to Final Investment Decision. This in turn can potentially deliver enhanced returns to shareholders
LPI Chairman, David Hannon, said:
‘On behalf of the LPI Board I would like to thank our joint venture partners for their efforts to deliver this logical consolidation of ownership of Maricunga and welcome the new shareholders to LPI. With ownership of Maricunga now consolidated we are best placed to pursue the funding and development of Maricunga and deliver further value to our shareholders.’
Advisors
Treadstone Resource Partners acted as strategic and financial advisor to LPI in respect of the Transactions. Ashurst acted as the Australian legal advisor, Stikeman Elliott LLP acted as the Canadian legal advisor, and Pillsbury Winthrop Shaw Pittman acted as the US legal advisor to LPI. EY acted as the Australian, US and Canadian tax advisor to LPI.
Maricunga Lithium Brine Project
The Maricunga Project is located 170km north-east of Copiapó in Salar de Maricunga in the Atacama Region of northern Chile. In January 2022, LPI announced the results of its updated Definitive Feasibility Study (“DFS”) for the Stage One Maricunga Lithium Brine Project1, which supports 15,200 t/a production of battery grade lithium carbonate for 20 years. The DFS provides for a project NPV (leveraged basis) of US$1.4B (after tax) at an 8% discount rate, providing an IRR of 39.6%, a 2-year payback and estimated steady-state annual EBITDA of US$324 million.
The study confirmed that Maricunga could be one of the world’s lowest-cost producers of lithium carbonate, with an operating cost of US$3,718 per tonne not including revenue credits from a potassium chloride by-product. The project will have an exceptional ESG profile, aiming to achieving carbon neutrality once the operation beds down, setting new standards for social relationships.
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