Galan Lithium Ltd (ASX:GLN, OTC:GLNLF) has taken the next step in developing the Hombre Muerto West (HMW) Lithium Brine Project in Argentina, having raised US$25 million through a share placement and entitlement offer.
The company’s US$13.3 million entitlement offer was fully subscribed, and Chengdu Chemphys Chemical Industry subscribed for US$3 million of the US$12 million placement, subject to completion of definitive offtake agreements between the two companies.
Strongly supported raise
“The board has adopted a lower capital intensity Phase 1 development to an initial 4,000-tonne-per-annum lithium carbonate equivalent (LCE) rate in light of market conditions,” Galan Lithium managing director Juan Pablo (JP) Vargas de la Vega said.
“Funds raised from the offer and the planned Chemphys prepayment provide the means to complete this development and keep our planned start to production in the second half of 2025.
“Amid challenging market conditions, Galan is moving forward with the development of HMW.
“We remain confident about the project economics underpinning the HMW development and the future of the lithium market.”
High grade lithium exploration
The HMW Project in Argentina holds a mineral resource estimate of 8.6 million tonnes at 859 milligrams per litre lithium carbonate equivalent.
Some 83% of the resource sits in the higher confidence measured and indicated categories, offering greater surety.
The project sits in the bottom quartile of global lithium projects in terms of cost curve and CO2 emissions, expected to have a net present value (NPV8) of US$2 billion.
Galan plans to develop HMW in two phases – the first producing 4,000 tonnes per year of LCE, and then an expanded second phase ramping up to 5,400 tonnes once market conditions allow.
It plans to be in production next year.
