Tawana Resources has secured crucial funding that is expected to cement its future as an Australian-listed company following a proposed merger with Singapore’s Alliance Mineral Assets.
The $40 million funding package will be provided by a consortium of lenders led by Tribeca Investment Partners.
It eases Tawana’s fears that it would not be able to satisfy Australian Securities Exchange (ASX) conditions allowing the merged company to trade on the bourse.
Half of the funding package will conditionally be used following completion of the deal to satisfy the ASX requirements and see Alliance list on the bourse.
The companies are 50-50 joint venture partners at the Bald Hill lithium mine near Kambalda in Western Australia. They announced plans to merge in April.
Tawana managing director Mark Calderwood said the companies had always remained committed to an ASX listing of the merged group, and the conditional funding facility would increase balance sheet liquidity as they ramped up production and advanced optimisation of the mine and processing facilities.
“We also believe it paves the way towards an expeditious listing of Alliance on the ASX,” Calderwood said.
“We have received exceptional support from Tribeca Investment Partners and other investors which is a great endorsement of the Bald Hill lithium and tantalum mine.”
Tawana will use the remaining $20 million of the package to fund proposed lithium and tantalum circuit additions to the dense media separation (DMS) plant at Bald Hill.
It plans to increase the plant’s throughput rate by 50 per cent to 300 tonnes an hour and increase recovery rates through the additions.
Tribeca global natural resources portfolio manager Haydn Smith believes Bald Hill is uniquely positioned, having reviewed most hard rock spodumene projects globally.
“The project has the lowest capital intensity in the sector and produces a coarse product anomalously low in magnesium, iron, mica and other deleterious materials, making it highly sought after by lithium converters,” Smith said.
“We believe that Bald Hill spodumene will ultimately command its own pricing mechanism, much like high grade iron ore or high energy thermal coal.”
Tawana added the merger with Alliance remained on track for completion in November, with its JV partner’s shareholders overwhelmingly voting in favour of the terms of the deal.
The JV declared commercial production at Bald Hill in July. It is nearing completion of the metallurgical and engineering review to add a fines circuit and increase throughput from the existing DMS.