Nasdaq-listed Piedmont Lithium, has announced plans to conduct a Public Offering of 1.5 million shares of its common stock (subject to market and other conditions) to mainly fund its operations in Quebec and Ewoyaa, and other initiatives.
The Company intends to use the net proceeds from the offering to fund its share of the capital required to restart the operations at North American Lithium and Quebec as well as fund the exploration and definitive feasibility studies at Ewoyaa in Ghana.
Likewise, the Public Offering is to help advance the Company’s merchant lithium hydroxide plant in the Southeastern United States, and to continue development of the Carolina Lithium Project, where it is head-quartered. This includes ongoing permitting activities, engineering design, and property acquisition.
Additionally, the net proceeds from the sale of shares may be used to fund possible strategic initiatives and for general corporate purposes, Piedmont stated.
In a press release, Piedmont stated that J.P. Morgan and Evercore ISI are acting as joint book-runners and lead underwriters for the Public Offering. Piedmont intends to grant the underwriters a 30-day option to purchase up to 225,000 additional shares at the issue price of the Public Offering.
Commenting on the preliminary economic assessment of the Piedmont Lithium’s portfolio in Quebec and production timelines of Ewoyaa, President and CEO, Keith Phillips, said:
“While there remains a focus on our proposed flagship Carolina Lithium Project in Gaston County, N.C., we’ve been expanding our portfolio of mineral resources, production capacity, and upside financial exposure through assets and strategic investments in Quebec and Ghana.
“The planned 2023 restart of North American Lithium in conjunction with our partner, Sayona Mining, and the potential for spodumene production at Ewoyaa in partnership with Atlantic Lithium as early as 2024, creates an attractive timeline for potential revenue generation that could precede output at our proposed Carolina Lithium project.”Keith Phillips
Demand for EV Batteries Provides Upside Growth to Lithium Investment
The increased demand for EV batteries as well as the “steady drumbeat of expansion announcements from Original Equipment Manufacturers, continues to drive the need for additional lithium hydroxide supply to support the U.S. market,” Phillips said.
Piedmont Lithium is upbeat about expanding its access to resources, in addition to more hydroxide production capacity through a second potential plant. This, Phillips said, “would serve as a way of delivering security of supply to potential customers and returning value to shareholders in the process.”
The company, in Q3 2021, made an initial investment of 9.9 per cent into Atlantic Lithium (then Iron Ridge). Previous agreement with Atlantic Lithium was such that Piedmont would acquire up to 50 per cent of Atlantic lithium’s portfolio in Ghana via staged investments over 3-4 years supporting exploration, definitive feasibility study, and initial capital costs for Atlantic Lithium’s Ewoyaa Project.
Particularly, recent scoping update of the Ewoyaa project showed that mineral resource estimate increased from an initial 14.5Mt at 1.31% Li2O to 21.3Mt @1.31% Li2O and shows a potential upside project economics. The Ewoyaa project offers life-of-mine (LOM) revenues of more than US$2.43 billion and an internal rate of return (IRR) of 194 per cent over 11.4 years.