Global Geoscience raises $30m to advance Nevada lithium project

Lithium play Global Geoscience has boosted its bank balance by $30 million to advance work at its Rhyolite Ridge lithium-boron project in the US state of Nevada.

The institutional placement was heavily oversubscribed, reflecting strong support from a combination of existing shareholders and new institutional investors, driven by ongoing interest in Rhyolite Ridge.

However, investors weren’t overly receptive to the news, with the stock (ASX:GSC) trading 5 per cent lower at 21c in late morning trade.

Global will spend $5 million of funds raised on completing the pre-feasibility study into stages one and two of Rhyolite Ridge and $6 million on a pilot plant program in 2018.

Work on the definitive feasibility study will receive $13 million in 2019 while $6 million has been allocated to working capital over the next two years.

The placement of 300 million shares will be issued at a fixed price of 20c, a 9.1 per cent discount to Global’s last closing price on 25 September and 8.79 per cent discount to the 15-day volume weighted average price.

Rhyolite Ridge is a large, shallow lithium-boron deposit located close to existing infrastructure in southern Nevada.

The project boasts one of the biggest lithium and boron deposits in North America and has the potential to become a strategic, long-life and low-cost source of lithium and boron.

The project has some 3.4 million tonnes of lithium carbonate plus 11.3 million tonnes of boric acid (which fetches $US750 to $US1250 per tonne).

What’s more, the project is practically a neighbour of Tesla’s gigafactory, located only 360 km away.

The raising increases Global’s cash balance to around $35 million.