Canada invests $70m in Seymour Lake lithium project in Ontario
The lithium mine operated by Australia's Green Technology Metals could become the province's first lithium producer.
New Age Metals Inc. (TSXV: NAM) announced on Friday it has received subscriptions for a non-brokered private placement of approximately 31.56 million units of the company at a price of C$0.16 per unit, for aggregate gross proceeds of C$5.05 million.
Each unit will comprise one common share of the company and one-half of a common share purchase warrant. Each whole warrant will entitle the holder to purchase one additional common share at an exercise price of C$0.20 at any time up to 24 months following issuance.
Net proceeds will be used for the completion of a prefeasibility study and further exploration on its flagship River Valley project in Ontario, considered to be one of North America’s largest undeveloped primary palladium projects
New Age Metals said mining billionaire Eric Sprott has subscribed for nearly all of the units (31.25 million units for C$5 million). That would make Sprott, who already invested C$1 million through a separate financing earlier this year, an insider of the company.
The private placement will be completed in two tranches, with the first tranche of 18.28 million units expected close by the end of March. The second tranche of 12.97 million units is to be completed five business days after the company has obtained shareholder approval for the new control person that would be created once Sprott’s beneficial ownership exceeds 20%.
Net proceeds of the placement will be used for the completion of a prefeasibility study and further exploration on its flagship River Valley project in Ontario, considered to be one of North America’s largest undeveloped primary palladium projects. Subject to financing, the company plans to complete the study by the first quarter of 2022.
“We are extremely pleased with Mr. Sprott’s strong support of the company. His investment is expected to expedite the company’s plan to development at our flagship River Valley platinum group metals project and will allow us to become more aggressive in developing the balance of our green metal project portfolio,” Harry Barr, New Age Metals CEO, said in a news release.
“We believe that we are well positioned with a world-class North American asset at an opportune time in the market where platinum group metals are in high demand and critical metal supply diversification into North America is paramount,” he added.
In addition to River Valley, the company also has 100% ownership of the Genesis PGM-copper-nickel project in south-central Alaska. Under its lithium division, the company holds several projects in the southeastern part of Manitoba.
Shares of New Age Metals surged by more than 20% by noon EST on the latest Sprott investment. The green metals-focused miner has a market capitalization of C$27.1 million.
