Liontown funded for Kathleen Valley DFS

Liontown Resources has reported firm commitments from its first capital raising in more than 12 months that were “substantially in excess” of the cash sought to complete the definitive feasibility study for Kathleen Valley
30th October 2020
Resources Rising Stars

Liontown Resources has reported firm commitments from its first capital raising in more than 12 months that were “substantially in excess” of the cash sought to complete the definitive feasibility study for the 100%-owned Kathleen Valley lithium-tantalum project in Western Australia (reports MiningNews).

Liontown has raised A$12.5 million, with $10.3 million from institutional and professional investors, and it will seek shareholder approval for a further $2.2 million from directors.

The raising was priced at 23c, a 13% discount to the last closing price of 26.5c on Monday.

Work to support the DFS has started following an updated prefeasibility study that increased the project's net present value by 121% to $1.12 billion.

Kathleen Valley is one of the largest lithium deposits in Australia with reserves of 71 million tonnes at 1.4% lithium and 130ppm tantalum, while resources are 156Mt at 1.4% lithium and 130ppm tantalum.

The DFS will examine expanding reserves and resources, options to increase throughout from 2Mtpa, and to produce a premium spodumene concentrate grading greater than 6.5% lithium, to meet market demand for higher grade products.

The DFS will also examine options to produce battery-grade products onsite near Leinster, following a recent positive scoping study into production of lithium sulphate or lithium hydroxide.

The feasibility work should be complete in about 12 months.

A small portion of the funds will also be used for initial drilling of the Moora gold-platinum group metals-nickel-copper project in WA's Yilgarn, where initial exploration has defined a number of high-order geochemical anomalies in the same terrane as Chalice Gold's Julimar discovery, 95km to the south.

Liontown's last placement, in August 2019, raised $18 million at 12c, with the directors chipping in $1.4 million at the time.

Chairman Tim Goyder, who also chairs Chalice, is Liontown's largest shareholder, and has purchased more than $1.2 million worth of shares on market since April, boosting his stake to 18.3%.

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