Australian-based mineral explorer and developer Global Geoscience Limited (ASX:GSC) has announced the raising of $30 million via share placement which it will use to advance its lithium-boron project in Nevada.
Global Geoscience was placed in a trading halt prior to the Citigroup-managed offer. A total of 150 million shares were offered at a price of $0.20 per share. The placement was heavily oversubscribed, indicating strong investor support for the company.
The $30 million will be spent over a two-year period. In 2018, $5 million will be spent on stages 1 and 2 of a pre-feasibility study, with $6 million allocated for a pilot plant program and $3 million for general working capital. In 2019, $13 million will be spent on a definitive feasibility study, with an additional $3 million for working capital.
“We are delighted with the continued support shown by our existing institutional shareholders for the ongoing development of the Rhyolite Ridge Lithium-Boron Project, and we would like to take this opportunity to welcome a new number of high-quality investors to our registers,” said Global Geoscience’s Managing Director Bernard Rowe.
The placement is the second major piece of news to come out of Global Geoscience this week.
On Monday, the company announced that it had secured long-term water rights via an exclusive 20-year lease entailing access to 1.2 giga litres of water per annum. Water is critical to the development of any mine, but in a desert state such as Nevada, it is even more important.
Recently appointed Chairman of Global Geoscience James Calaway said that the securing of water significantly “de-risks” the company’s Rhyolite Ridge Lithium-Boron Project.
Calaway, who was the former Chairman of Orocobre, is one of several highly credentialed executives to join Global Geoscience within the last year. He has been joined by Alan Davies, the former CEO of Rio and Tinto and John Hofmeister, the former President of Shell Oil.
Rhyolite Ridge, which is 100%-owned by Global Geoscience, is a large, shallow lithium-boron deposit located close to existing infrastructure and Tesla’s Nevada gigafactory.
Global Geoscience is looking to capitalise on the growing global demand for lithium and boron. Lithium has a wide variety of applications, including pharmaceuticals, lubricants and its main growth market, batteries.
This year, China, India, France and the UK have announced ambitious targets to phase out internal combustion engine (ICE) vehicles by 2040. It is expected that the global increase of electric vehicles (EV) production will lead to a massive rise in the demand for lithium.
Although boron is a lesser-known commodity, it is used in glass, ceramics, semiconductors and agriculture.
In the coming years, Global Geoscience aims to develop Rhyolite Ridge into a strategic, long-life and low-cost supplier of lithium and boron.