IronRidge to fund and fast track the Ewoyaa lithium project in Ghana


IronRidge Resources Ltd (LON:IRR) said Piedmont Lithium Inc., a Nasdaq-listed lithium exploration and development company, has agreed to fully fund and fast track the Ewoyaa lithium project in Ghana for US$102mln.

Under the agreement, Piedmont can earn 50% of IronRidge’s Cape Coast Lithium Portfolio (CCLP), which includes the Ewoyaa project, in three stages.

Piedmont will subscribe to 54.0mln shares in IronRidge at 20p per share, totalling £10.8mln (US$15mln) and giving it a 9.5% stake in IronRidge.

It can then earn up to an initial 22.5% of CCLP after spending US$5mln on an exploration programme to enhance the current Ewoyaa resource and US$12mln on completing Definitive Feasibility Studies.

At the final stage, Piedmont can earn a further 27.5% of CCLP by providing US$70mln of capital expenditure to take the project into production.

“With Piedmont’s established relationships with US based automakers, this is an outstanding opportunity for IronRidge to fully fund its industry-leading Ewoyaa lithium project through to production, said IronRidge chief executive Vincent Mascolo.

“This pathway to production transaction removes funding risks for IronRidge and its shareholders at a time where surety of supply to the enormous and rapidly growing North American EV [electric vehicle] and stored energy industry sectors is paramount,” he said.

Piedmont and IronRidge have also entered into a binding offtake agreement for 50% of the Cape Coast Lithium Portfolio’s life of mine spodumene concentrate.

The agreement provides an opportunity for Ghana to become the first lithium producer in Western Africa.

“We consider Ewoyaa to be among one of the world’s most promising spodumene projects, leveraging existing world class infrastructure including directly adjacent HV power, a major highway within 1km of the site, and the major port of Takoradi less than 2 hours’ drive away,” said Keith Phillips, president and chief executive of Piedmont.

“Few hard-rock lithium projects worldwide can boast the proximity to existing operational infrastructure, lithium grade and a simple Dense Media Separation-only process route that will require very low upfront capital expenditure.

“As a company seeking to support the production of lithium and accelerate the transition to a sustainable future, we look forward to providing a pathway to production at this industry-leading project.”

Piedmont has also agreed to support IronRidge’s previously announced plans to demerge its gold interests in Côte d’Ivoire and Chad into a separate gold-focused company.

Source: Proactive Investors