Lithium liquidity jumps on CME as traders seek arbitrage plays
Open interest has continuously hit record after record since April.
Chile-focused explorer and developer CleanTech Lithium (AIM: CTL) said on Tuesday its plans to list on the Australian Securities Exchange (ASX) next month, targeting to raise up to A$20 million ($13m) in capital.
The company, already listed on AIM — a specialized unit of the London Stock Exchange (LSE) catering to smaller, more risky companies — believes the ASX is a “natural fit”.
CleanTech’s current shareholder base features Australian shareholders, including Regal Funds Management at about 15%.
“The dual-listing in Australia will provide us with access to a broader collection of security holders and stakeholders who have a deep understanding of the lithium industry and its importance in supporting the world’s ambitions for net-zero,” executive chair and interim chief executive, Steve Kesler, said in the statement.
The company, which is developing direct lithium extraction- (DLE-) based lithium brine projects in Chile, completed in July the first phase of production at its DLE pilot plant in the country’s north.
This new way of mining lithium is being presented by a majority of actors involve in the global electric vehicles (EVs) supply chain, as the answer to boosting production while also preserving the environment. Billions of dollars are pouring in to what Goldman Sachs calls “potential game-changing technology,” as its impact is expected to be much like shale’s on the oil industry.
According to the bank, if 20% to 40% of Latin America’s brine projects use DLE, it could increase the region’s lithium output by about 35% from 2028 — or an 8% boost to global supply.
CleanTech is advancing two main projects, which together hold over 2.7 million tonnes of lithium carbonate equivalent (LCE).
Scoping studies conducted in 2023 for the flagship Laguna Verde and the Viento Andino projects revealed that both assets could achieve low-cost production and strong economic performance. Each proposed mine has the potential to support a 20,000-tonne-per-year lithium carbonate operation, positioning them within the industry’s lowest cost quartile.
CleanTech said a pre-feasibility study for Laguna Verde will be completed by the end this year.
The company’s planned dual-listing will include a fundraising initiative aimed at generating between A$10 million and A$20 million. The capital will be raised through the issuance of Chess Depositary Interests (CDIs) at a price of A$0.30 per CDI. Investors will also receive a free-attaching option, exercisable at A$0.375, as part of the offer, the company said.
Chile’s lithium output to date is based on what only two companies produce: SQM (NYSE: SQM) and US-based rival Albemarle (NYSE: ALB), which is testing its own use of DLE.
Santiago-based SQM researched over 70 DLE technologies before selecting 12 for pilot testing, with two of these trials already underway.
Chile is the world’s top copper producer and the second-largest producer of lithium after Australia. Both metals are considered vital commodities for the global transition from fossil fuels to renewable energies.
Comments