Lithium Ionic Secures $11 Million Financing for Projects in Brazil

Lithium Ionic (TSXV: LTH) announced its intention on Monday to raise C$15 million ($11 million) via a private placement aimed at its long-term shareholders. The proposed offering will consist of units priced at C$0.90 each, with each unit containing one common stock along with a warrant to purchase another share at C$1.05. The Toronto-based lithium developer holds the majority of its ownership, approximately 60%, among the general public, while insiders, including CEO Blake Hylands and President Hélio Diniz, collectively hold around 20%. As news of the private placement spread, Lithium Ionic's shares surged by 7.6% in Toronto by midday, reaching C$0.86 apiece, resulting in a market capitalization of C$118.8 million ($87 million).

The net proceeds from the private placement are slated to bolster Lithium Ionic's two flagship projects, Itinga and Salinas, located within Brazil's renowned 'Lithium Valley', spanning over 141 sq. km. Itinga, one of the projects, finds itself in the same vicinity as CBL's long-standing Cachoeira lithium mine, which has been a key lithium producer for over three decades, as well as Sigma Lithium's Grota do Cirilo project. The core of the Itinga project is the Bandeira deposit, which features a measured and indicated resource of 23.7 million tonnes, exhibiting a lithium oxide (Li2O) grade of 1.34%. This equates to 783,000 tonnes of lithium carbonate equivalent (LCE). A recent feasibility study on Bandeira illustrated promising prospects, with the project's post-tax net present value (at an 8% discount rate) reaching $1.3 billion, a post-tax internal rate of return of 40%, and an initial capex of $266 million. It is projected that the underground mine would yield approximately 17.2 million tonnes of LCE, with a Li2O grade of 5.5%, over a 14-year operational span commencing in 2026.

On the other hand, the company's second major project, Salinas, located roughly 120 km north of Bandeira, boasts a recent measured and indicated resource estimate of 5.9 million tonnes, with a Li2O grade of 0.97%, amounting to 158,678 tonnes of LCE. Acquired in March 2023 through the acquisition of Neolit Minerals, the Salinas project saw Lithium Ionic gain complete ownership just last week.

This strategic financing move underscores Lithium Ionic's commitment to further advancing its key projects in Brazil's Lithium Valley, both of which show promising potential for substantial lithium production in the years to come.

Lithium Ionic, a Canadian mining enterprise, is actively engaged in the exploration and development of its lithium assets located in Brazil. Positioned in the northeastern region of Minas Gerais state, its flagship projects, Itinga and Salinas, encompass a total area of 14,182 hectares. This area, recognized for its mining-friendly environment, is swiftly gaining prominence as a leading hard-rock lithium zone on a global scale. Notably, the Itinga Project shares geographical proximity with CBL's long-standing Cachoeira lithium mine, a renowned lithium producer for over three decades, as well as Sigma Lithium Corp.'s Grota do Cirilo project, home to the largest hard-rock lithium deposit in the Americas.