GT1 has received a $20m investment priced at a 43% premium from LG Energy Solution. Pic: via Getty Images
GT1’s Ontario lithium strategy gets $20m validation from LG Energy Solution
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Green Technology Metals’ strategy of building a vertically integrated lithium business in Ontario has received a major endorsement from top tier battery manufacturer LG Energy Solution.
It is hard after all to argue with a $20m share subscription that prices each new GT1 share at 92c, a 43% premium to its 30-day value weighted average price along with an offtake term sheet which practically guarantees that LG will purchase 25% of spodumene concentrate production from the Seymour project.
Green Technology Metals (ASX:GT1) says the investment validates the value of Seymour as well as its strategy to become Ontario’s first lithium producer.
Adding further interest, the offtake term sheet allows for the company to deliver lithium hydroxide with an equivalent lithia content to the agreed spodumene amount to LG should it develop a lithium hydroxide conversion facility during the five year period it covers.
Pricing for both spodumene and lithium hydroxide has been agreed based on a formula linked to the prevailing market price of lithium hydroxide.
“We welcome the execution of these important agreements with LGES and look forward to their contribution as a new strategic partner with GT1, alongside AMCI, Lithium Americas and Primero,” chairman John Young said.
“LGES brings global scale and expertise in battery manufacturing as well as balance sheet strength as GT1 advances its integrated lithium strategy in the Tier 1 jurisdiction of Ontario.”
LGES chief procurement officer Myung Hwan Kim said partnerships with companies like Green Technology Metals ensured that it could continue its “devotion” to expediting the EV transition in North America.
Seymour lithium project
Proceeds from the share subscription, which grants LGES a 7.89% interest in the company, will be used to advance the Seymour project.
Seymour has a resource of 9.9 million tonnes grading 1.03% Li2O and 128 parts per million tantalum.
The company has already secured a land package for the proposed conversion facility in Thunder Bay and has sent a formal submission of project definition to the Ontario Minister of Mines to initiate the permitting process.
Additionally, third year baseline environmental assessments are under way and a mining lease application over the project has been submitted.
Metallurgical test work is already underway to optimise the lithium hydroxide conversion process for its integrated project stand.
This article was developed in collaboration with Green Technology Metals, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
