Bacanora Lithium shifts attention to construction as financing completes
- Bacanora Lithium says Sonora project sufficiently funded for the next 15 months
- Bacanora Lithium 'fully financed and ready to develop the Sonora mine project' following fundraise
Quick facts: Bacanora Lithium Ltd
Price: 67.9 GBX
Market Cap: £260.83 m
About the company
Bacanora Lithium is an AIM listed company focused on building a 35,000 tonne per annum open pit battery grade lithium operation, in collaboration with its major shareholder and offtake partner, Ganfeng Lithium (the world's largest lithium metals producer).
The mine, the Sonora Lithium Project in Mexico, is one of the world’s larger lithium resources and benefits from being both high grade and scalable.
How it is doing
Bacanora Lithium PLC has sufficient funds to support the short-term funding requirements and the construction programme of its flagship Sonora lithium project in Mexico for the next 15 months, the company said alongside its interim results.
The lithium development and exploration company also said it has been in talks with RK Mine Finance regarding a US$150mln debt facility secured in July 2018. Due to extension fee considerations and the limited availability period for an extension, Bacanora and RK have agreed the remaining undrawn facility of US$125mln will no longer be available, it said. Bacanora added it will continue to engage with RK as well as seek alternative terms with other debt providers in light of the current favourable debt market conditions.
The company made a pretax profit of US$33.5mln in the first half, versus a pretax loss of US$4.7mln the year-earlier period, mainly due to a US$31.9mln one-off gain from the change of control of Sonora Lithium Ltd.
During the six months, initial site works started at the Sonora project, including initial environmental site activities in preparation for the construction of the mine and processing plant.
Bacanora Lithium PLC has agreed terms of its takeover by major shareholder Ganfeng International following approval for the deal by the authorities in China.
As flagged when the original approach was made in May, Ganfeng is offering 67.5p cash for each Bacanora share.
Bacanora Lithium PLC (AIM:BCN) said a court in Alberta, Canada has issued a judgement in favour of the Estate of Colin Orr-Ewing regarding the validity of a lithium royalty over the Sonora project.
AIM-listed Bacanora is challenging the validity of a previously reported 3% royalty over the MSB concessions within the Sonora lithium project, payable to the Orr-Ewing Estate, and was seeking to have the royalty declared invalid.
What management says
Bacanora Lithium's (LON:BCN) Peter Secker catches up with Proactive London's Katie Pilbeam about their latest US$65m financing with Ganfeng Lithium exercising its pre-emptive rights.
The chinese giant has increased its position to 28.8% meaning that it remains BCN’s largest shareholder.
Secker says the company is now 'fully financed and ready to develop the Sonora mine project in Mexico.
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