Askari to Achieve Namibian Lithium Targets Following Successful $2.5M Funding Round
- 05-May-2023 12:18 PM
- Journalist: Patricia Jose Perez
Namibia: Askari Metals has successfully met the conditions for a $2.5 million strategic equity investment by Huayou International Resources, a leading global supplier of battery materials. As a result, Askari will accelerate its Lithium exploration efforts at the Uis project in Namibia. Huayou has decided to subscribe for 4.5 million fully paid ordinary shares in Askari at an issue price of 55 cents per share, which represents a handsome premium compared to Askari's current share price of around 40 cents.
Zhejiang Huayou Cobalt, a tier-one global supplier of Lithium battery and Cobalt materials, has announced that it will subscribe for 4.5 million fully paid ordinary shares in Askari at an issue price of 55 cents per share. For every three shares purchased, Huayou will receive one attaching option for free. The exercise price for the available options is 25 cents, and they will expire on October 31 of next year. The funds settlement for the strategic investment made in Askari is scheduled to happen in the next few days. However, it should be noted that the ordinary shares to be distributed to Huayou will be under a one-year voluntary escrow period.
On the other hand, the free attaching options issued to Huayou will be freely tradeable once it lodges a cleansing statement related to the strategic investment.
As per their plans, Huayou aims to grow its stake in Askari up to 9.9%. Once they achieve this target, they will also have the option to appoint a member to the company's board. Furthermore, they have decided to extend their support to Askari by providing technical input and guidance for continued exploration, development, and mine construction, along with downstream Lithium processing.
Zhejiang Huayou Cobalt is into four major business segments. These include the development and refining of Nickel, Cobalt, and Lithium battery metals, production of precursors and ternary cathode materials, and the recycling of battery materials.
Huayou has significant experience in mine construction and operation. It has worked on two Copper and Cobalt projects in the Democratic Republic of Congo and produces an annual production of 100,000 tonnes of cathode Copper and 10,000 tonnes of Cobalt. The company has furthered its investment in Indonesia by funding three Nickel and Cobalt projects, with an anticipated yearly output of 225,000 tonnes of Nickel and 23,000 tonnes of Cobalt expected by next year.
In March of this year, the first batch of product was successfully produced at the Arcadia Lithium project in Zimbabwe, which was acquired by Huayou for US$422 million (AU$630.2 million) in April of last year. The project has an annual processing capacity of 4.5 million tons of ore.
Askari has a Lithium project called Uis that spans 308 square kilometers in a highly mineralized, spodumene-rich pegmatite belt. The project has a history of prior production and exploration success, and due diligence sample results have identified exceptional potential. Many pegmatites ranging from a few meters in width to more than 50 meters wide are exposed at the surface.
The mining history of many pegmatites in the area includes Tin and semi-precious stones, with notable occurrences of altered spodumene and lepidolite visible in the surrounding rocks. Located less than 5km from Uis township and less than 2.5km from Andrada's Lithium-Tin-Tantalum mine, the project present in west-central Namibia is strategically positioned. The Lithium-Tin-Tantalum mine at Uis is estimated to have resources of 81 million tonnes at 0.73% Lithium Oxide, 0.15% Tin, and 0.14% Rubidium, with a total metal content of 1.45 million tonnes of Lithium Carbonate equivalent, 120,000 tonnes of Tin, and 109,400 tonnes of Rubidium, as well as significant amounts of Tantalum.
Andrada is confident that its mine is of world-class quality and plans to increase its resources up to around 200 million tonnes.
During due diligence work last month, Askari acquired about a third of its ground and sampled various pegmatite outcrops. As a result, high-grade Lithium, Tin, Tantalum, and Rubidium up to 2.11% Lithium Oxide, 1.3% Tin, 658 parts per million Tantalum, and 4214ppm Rubidium were identified through assays. Additionally, several types of pegmatite were identified, including ones that host Lithium-Caesium-Tantalum and Caesium-depleted pegmatites that have more correlation with Tin and Tantalum.
Askari is set to embark on an exciting exploration journey with the help of its knowledgeable and experienced strategic partner. Situated adjacent to a massive deposit of Lithium-Tin-Tantalum and Rubidium and possessing high-grade rock-chip samples in its ground, the company is eager to get to work. This partnership has the potential to unlock lucrative opportunities for Askari's future growth and development.