AVZ Minerals has raised $9.8 million to fast-track its Manono lithium and tin project in the Congo towards production.
The placement was cornerstoned by new investor Lithium Plus and existing investor Huayou Cobalt Group, both of which have established ties in the world’s largest vehicles market, China.
Lithium Plus is a specialist lithium investment company led by the director of North American Lithium, whose company is developing an open pit lithium carbonate mine in Quebec.
The company has subscribed for $3 million in the placement, earning an initial interest of 3.46 per cent in AVZ Minerals.
Huayou Cobalt Group also maintained a 9.3 per cent interest in AVZ by subscribing for $1 million in the placement.
The group is one of the world’s largest manufacturers of cobalt chemicals for use in batteries and has extensive experience with established mining operations in the Congo.
The raised funds, combined with AVZ’s recent share purchase plan (SPP), has brought its total proceeds to $15 million before costs.
“This placement together the oversubscribed SPP, will leave fully funded to final investment decision,” AVZ managing director Nigel Ferguson said.
The share placement, from which AVZ Minerals has successfully raised its funds, have been met with more demand than the number of shares originally issued.
It comes at an exciting time for participants in the lithium industry as interest in electric vehicles in the world’s largest vehicle market surges.
Chinese sales of electric cars are reported to have increased 188 per cent in January 2019, according to AVZ Minerals.
AVZ expects the funding to assist in achieving its goal of delivering Manono’s definitive feasibility study in 2019.
The Manono project is co-owned with state-owned enterprise La Congolaise D’exploitation Miniere SA (30 per cent) and privately-owned Dathomir Mining Resources SARL (10 per cent). However, AVZ (60 per cent) is responsible for funding expenditure to completion of a feasibility study.