Neo Lithium Corp (CVE:NLC) (OTCQX:NTTHF) (FRA:NE2) reported that it has entered into an agreement with Stifel GMP and its syndicate of underwriters for the issuance of 9.9 million Neo Lithium special warrants, at a price of C$3.05 per warrant, for total gross proceeds of C$30.2 million.
Neo Lithium said it plans to use the net proceeds from the offering to fund development work at its 3Q Lithium Project in Argentina, the majority of which will be allocated to advance construction of the concentration pond system at a commercial scale to accelerate future production at the project.
The company added that the remainder of the funds will be used for working capital and general corporate purposes.
READ: Neo Lithium steadfastly advancing one of the world's best lithium brine projects towards final feasibility
Each special warrant will entitle the holder to receive one common Neo Lithium share.
Neo Lithium also noted that Contemporary Amperex Technology Co., Limited's (CATL) subsidiary holds a participation right to maintain its pro-rata percentage holding in the company and may or may not exercise its participation right in connection with the offering.
The offering is scheduled to close on or about February 10, 2021.
Neo Lithium’s flagship Tres Quebradas project in Argentina, also known as the '3Q' project, lies in the southern end of what is known as the ‘Lithium Triangle’, covering 35,000 hectares.
3Q is one of the top three highest-grade lithium projects in the world and is the seventh-largest brine project on the planet with significant exploration potential.
The project has proven and probable reserves of 1.3 million tons of lithium carbonate (LCE) with 790 milligrams per litre (mg/l) of lithium and a report last year highlighted its strong economics and 35-year mine life. In terms of resources, at the overall deposit area, using a 400 mg/l cut-off, the 3Q project has over four million tonnes of LCE in the higher confidence measured and indicated (M&I) category.
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