- Piedmont to acquire a 19.9% equity interest in newly-formed
Vinland Lithium for C$2 million cash consideration
- Through staged investments, Piedmont may earn up to a 62.5%
equity interest in Vinland’s Killick Lithium Project
- Killick Lithium’s large land package hosts ~60 kilometers of
highly prospective strike length
- Initial exploration results are encouraging, and the Project is
logistically advantaged in southern Newfoundland, Canada
- Piedmont will have a right of first refusal on offtake rights
to future concentrate production
- Investment is consistent with Piedmont’s strategy of growing
its spodumene resource base by investing in projects with
large-scale potential in favorable locations, and managed by strong
exploration teams
Piedmont Lithium Inc. (“Piedmont” or the “Company”) (Nasdaq:
PLL; ASX: PLL), a leading global supplier of lithium resources
critical to the U.S. electric vehicle supply chain, today announced
a strategic investment in a large prospective lithium project in
Newfoundland, Canada. Piedmont has agreed to pay C$2 million for a
19.9% equity interest in Vinland Lithium Inc. (“Vinland Lithium”),
a new entity established with Sokoman Minerals Corp. (“Sokoman
Minerals”) (40.1%) and Benton Resources Inc. (“Benton Resources”)
(40.1%). The Company also may earn up to a 62.5% equity interest in
Killick Lithium Inc., a wholly-owned subsidiary of Vinland Lithium
holding a 100% interest in the Killick Lithium Project (“Killick
Lithium” or the “Project”), through a staged investment agreement.
Piedmont will be entitled to 100% marketing rights and a right of
first refusal on 100% offtake rights to any lithium concentrate
produced by the Project on a life-of-mine basis at competitive
commercial rates. Transaction details are provided below.
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Killick Lithium Project relative to
Piedmont Lithium’s asset portfolio
Geologically, the Killick Lithium property is analogous to the
Carolina Tin-Spodumene Belt, which hosts Piedmont’s Carolina
Lithium project. The property totals 950 square kilometers and
hosts approximately 60 kilometers of prospective strike length.
Initial prospecting on the property by Benton Resources and Sokoman
Minerals in 2021 led to the discovery of the first occurrence of
spodumene-bearing pegmatite in Newfoundland.
According to their data, the work to date of Benton Resources
and Sokoman Minerals includes 61 exploratory drill holes, 50 of
which intersected spodumene-bearing pegmatites. Mineralization in
surface trenching and drilling has now been identified over a
strike length of 2.5 kilometers. These early drilling results
include multiple intercepts over 1.0% Li2O and demonstrate the
potential for additional discoveries within the property. Their
exploration work in 2023 has identified numerous soil and
geophysical anomalies, highlighting high-priority drill targets.
The property features excellent infrastructure with close proximity
to paved roadways, an electrical substation, and an ice-free,
deepwater port.
Patrick Brindle, Chief Operating Officer for Piedmont Lithium,
said the partnership supports the Company’s strategy to grow its
hard rock lithium resource base with a focus on large targets in
attractive locations and furthers Piedmont’s plans to be a major
producer of lithium hydroxide for the North American market. “The
Killick Lithium Project comprises a vast land package in an
attractive jurisdiction. Our team has visited the site on multiple
occasions and conducted extensive due diligence. Early exploration
results are favorable, and the Project’s location is advantageous
in terms of infrastructure and logistics,” said Brindle. “The
Vinland Lithium exploration team is highly experienced and will
manage all aspects of the exploration program. While we help fund
exploration activities at Killick Lithium, our projects and
operations teams remain focused on the ongoing development of our
core portfolio, including the producing North American Lithium mine
in Quebec and our planned operations in Ghana, Tennessee, and North
Carolina.”
Summary of Key Terms of Subscription and Earn-In
Agreements
Item
Details
Subscription
- Piedmont subscribes for a number of shares in Vinland Lithium
as would equal a 19.9% voting and participating interest therein
for a subscription price of C$2 million.
- The subscription agreement includes customary terms and
conditions, including representations and warranties and covenants
of Vinland Lithium customary for a transaction of this nature.
Initial Earn-in Right
- Within 30 days following the execution of the earn-in
agreement, Piedmont shall have the option, exercisable by notice,
to acquire a 16.35% voting and participating interest in Killick
Lithium.
- Piedmont’s initial interest will be conditional upon (i)
Piedmont's issuance of common stock to Sokoman Minerals and Benton
Resources having an aggregate subscription price of C$2 million and
(ii) Piedmont funding prospecting, exploration, development, and
production expenses of Killick Lithium of at least C$6 million (the
“Initial Earn-In Amount”) within 30 months of the initial earn-in
right notice.
First Additional Earn-in Right
- Within 60 days following the funding of the Initial Earn-In
Amount, Piedmont shall have the option, exercisable by notice, to
acquire an additional 21.65% voting and participating interest in
Killick Lithium.
- Piedmont’s first additional interest will be conditional upon
(i) Piedmont's issuance of common stock to Sokoman Minerals and
Benton Resources having an aggregate subscription price of C$2
million and (ii) Piedmont funding prospecting, exploration,
development, and production expenses of Killick Lithium of at least
C$3 million (the “First Additional Earn-In Amount”) within 12
months of the first additional earn-in right notice.
Second Additional Earn-in Right
- Within 60 days following the funding of the First Additional
Earn-In Amount, Piedmont shall have the option, exercisable by
notice, to acquire an additional 24.5% voting and participating
interest in Killick Lithium.
- Piedmont’s second additional interest will be conditional upon
(i) Piedmont's issuance of common stock to Sokoman Minerals and
Benton Resources having an aggregate subscription price of C$6
million and (ii) Piedmont funding prospecting, exploration,
development, and production expenses of Killick Lithium of at least
C$3 million (the “Second Additional Earn-In Amount”) within 12
months of the second additional earn-in right notice.
Exclusive Marketing Rights and Offtake
Rights
- Killick Lithium grants Piedmont exclusive marketing rights for
the promotion and sale of any lithium products produced from the
Project on a life of mine basis.
- Piedmont shall have the right of first refusal on 100% offtake
rights to the lithium concentrates produced from the Project, on a
life of mine basis, at competitive commercial rates.
NSR
- Killick Lithium grants a 2% NSR in favor of Sokoman Minerals
and Benton Resources with Killick Lithium, Piedmont, or any of
their successors retaining the right to repurchase 50% of such
royalty (1%) in consideration for a C$2 million cash payment to
Sokoman Minerals and Benton Resources.
Operatorship
- Sokoman Minerals and Benton Resources shall maintain
operatorship of Killick Lithium up to and until the funding of the
Second Additional Earn-In Amount.
- Following funding of the Second Additional Earn-In Amount,
Piedmont shall be the operator of the Project and shall manage and
execute all prospecting, exploration, development, and production
programs and spending on the Project.
About Piedmont Lithium
Piedmont Lithium Inc. (Nasdaq: PLL; ASX: PLL) is developing a
world-class, multi-asset, integrated lithium business focused on
enabling the transition to a net zero world and the creation of a
clean energy economy in North America. Our goal is to become one of
the largest lithium hydroxide producers in North America by
processing spodumene concentrate produced from assets where we hold
an economic interest. Our projects include our Carolina Lithium and
Tennessee Lithium projects in the United States and partnerships in
Quebec with Sayona Mining (ASX: SYA) and in Ghana with Atlantic
Lithium (AIM: ALL; ASX: A11). These geographically diversified
operations will enable us to play a pivotal role in supporting
America’s move toward energy independence and the electrification
of transportation and energy storage. For more information, follow
us on Twitter @PiedmontLithium and visit
www.piedmontlithium.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of or as described in securities legislation in the
United States and Australia, including statements regarding
exploration, development construction and production activities of
Piedmont, Vinland Lithium and Killick Lithium; Piedmont’s potential
acquisition of an ownership interest in Killick Lithium; and
related strategy. Such forward-looking statements involve
substantial and known and unknown risks, uncertainties, and other
risk factors, many of which are beyond our control, and which may
cause actual timing of events, results, performance or achievements
and other factors to be materially different from the future timing
of events, results, performance, or achievements expressed or
implied by the forward-looking statements. Such risk factors
include, among others: (i) that Killick Lithium may be unable to
commercially extract mineral deposits, (ii) that Killick Lithium
properties may not contain expected resources or reserves, (iii)
risks and hazards inherent in the mining business (including risks
inherent in exploring, developing, constructing and operating
mining projects, environmental hazards, industrial accidents,
weather or geologically related conditions), (iv) uncertainty about
Piedmont, Vinland Lithium’s and Killick Lithium’s ability to obtain
required capital to execute their business plan, (v) Piedmont,
Vinland Lithium’s, and Killick Lithium’s ability to hire and retain
required personnel, (vi) changes in the market prices of lithium
and lithium products, (vii) changes in technology or the
development of substitute products, (viii) the uncertainties
inherent in exploratory, developmental and production activities,
including risks relating to permitting, zoning and regulatory
delays , (ix) uncertainties inherent in the estimation of lithium
resources, (x) risks related to competition, (xi) risks related to
the information, data and projections related to Vinland Lithium
and Killick Lithium, (xii) occurrences and outcomes of claims,
litigation and regulatory actions, investigations and proceedings,
(xiii) risks regarding our ability to achieve profitability, enter
into and deliver product under supply agreements on favorable
terms, our ability to obtain sufficient financing to develop and
construct our projects, our ability to comply with governmental
regulations and our ability to obtain necessary permits, and (xiv)
other uncertainties and risk factors set out in filings made from
time to time with the U.S. Securities and Exchange Commission
(“SEC”) and the Australian Securities Exchange, including
Piedmont’s most recent filings with the SEC. The forward-looking
statements, projections and estimates are given only as of the date
of this press release and actual events, results, performance and
achievements could vary significantly from the forward-looking
statements, projections and estimates presented in this press
release. Readers are cautioned not to put undue reliance on
forward-looking statements. Piedmont disclaims any intent or
obligation to update publicly such forward-looking statements,
projections, and estimates, whether as a result of new information,
future events or otherwise. Additionally, Piedmont, except as
required by applicable law, undertakes no obligation to comment on
analyses, expectations or statements made by third parties in
respect of Piedmont, its financial or operating results or its
securities.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231011399097/en/
For further information, contact:
Erin Sanders SVP, Corporate Communications & Investor
Relations T: +1 704 575 2549 E: esanders@piedmontlithium.com
Christian Healy/Jeff Siegel Media Inquiries E:
Christian@dlpr.com E: Jeff@dlpr.com
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