ioneer to be financed through to Rhyolite Ridge investment decision
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Special Report: Ioneer is raising $40m that will see its Rhyolite Ridge lithium-boron project in Nevada through to a final investment decision.
With both lithium and boron considered to be critical minerals in the US, it’s not hard to see how ioneer (ASX:INR) has managed to secure full underwriting for the $40m placement priced at 20c per share, an 11.1 per cent discount to its last closing price of 22.5c.
Additionally, half of the placement will be taken up by US-based private capital investor Centaurus Capital, which along with its existing shares will give the fund a 7.8 per cent stake in the company.
Proceeds from the placement will be used to complete the key definitive feasibility study (DFS), advance detailed engineering beyond the DFS to about 50 per cent completion, complete the environmental approval process and other ongoing working capital and potential long lead items.
The Rhyolite Ridge DFS and decision on relevant environmental approval process are anticipated to be complete by the first quarter of 2020.
“The last 12 months have been an exciting, defining period for ioneer, making significant steps to de-risk Rhyolite Ridge and move closer to FID [final investment decision],” managing director Bernard Rowe said.
“Since the publication of the PFS in late 2018, a number of critical milestones have been achieved including the successful construction, development and operation of a full simulation pilot plant; and importantly, confirmation via independent third-party analysis of the quality and exceptionally low impurity content of our lithium carbonate product.
“The equity raising announced today is yet another key milestone for the company as it ensures we are well funded through to FID and can focus on delivery of the DFS, securing off-take agreements, advancing detailed engineering to ensure the shortest possible timeframe to production and completion of the environmental permitting process.”
Chairman James Calaway added that the company’s confidence in Rhyolite Ridge had grown over the past year.
“This is reaffirmed through the support of an organisation with the calibre of Centaurus Capital, a key pillar and supporter of the ioneer story,” he said.
Rhyolite Ridge is a large, shallow lithium-boron deposit that is envisaged to produce 20,000 tonnes of lithium carbonate and 173,000 tonnes of boric acid per annum at full capacity from a resource containing 12.4 million tonnes of boric acid and 1.3 million tonnes of lithium carbonate.
A pilot plant has already demonstrated the project’s ability to produce high-quality lithium and boron products, with samples sent to 30 potential offtake partners.
ioneer has flagged that both the lithium and boron production are of equal importance in terms of revenue from the project, which is just one of two known large lithium-boron deposits globally.