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PERTH (miningweekly.com) – US major Piedmont Lithium will take a 19.9% stake in ASX-listed Sayona Mining, and a 25% interest in the company’s subsidiary Sayona Quebec Inc, for a total investment of $12-million.
The two companies on Monday announced that Piedmont would acquire an initial 9.9% interest in Sayona for a $3.1-million share investment and two unsecured convertible notes for some $3.9-million, which upon conversion would give the company an additional 10% interest in Sayona.
Piedmont would appoint one director to the Sayona board.
Furthermore, the US lithium miner would also purchase a 25% stake in Sayona’s subsidiary, Sayona Quebec, for some $5-million in cash.
Sayona Quebec is developing the Authier lithium project, owns the highly prospective Tansim lithium project, and is pursuing a bid to acquire the Quebec-based North American Lithium’s (NAL’s) assets.
In addition to taking a stake on both Sayona and its subsidiary, Piedmont has also agreed to a binding offtake arrangement under which it would acquire up to 60 000 t/y of spodumene concentrate, or some 50% of Sayona’s Quebec production, whichever is greater.
The offtake agreement would be for Sayona’s life-of-mine operations in the region, and is based on a minimum market price of $500/t and a maximum price of $900/t on a delivered basis, to Piedmont’s planned lithium hydroxide plant in North Carolina.
The supply agreement was conditional on both Piedmont and Sayona agreeing to a start date for spodumene concentrate deliveries between July 2023 and July 2024, based on the development schedules of both companies.
Sayona told shareholders on Monday that the partnership with Piedmont would advance the development plans of both companies in North America.
“Piedmont has shown tremendous vision in creating the base in North Carolina, a center of lithium hydroxide production in the US, and has secured significant supply agreements with leading electric vehicle makers,” said Sayona MD Brett Lynch.
“This agreement will underwrite the future of our Authier project, expedite our growth plans in Quebec, including our bid for North American Lithium, and enhance access to the US market and investors.”
Piedmont CEO and president Keith Phillips said the agreement was a win-win for both companies.
“Piedmont is building a world-class spodumene-to-hydroxide business in North Carolina, and we are now very pleased to be partnering with Sayona to advance a similar business in Quebec.”
“2021 will be an important year for our Piedmont lithium project, as we plan to expand our mineral resource, finalise permitting, execute additional lithium offtake agreements, complete an integrated definitive feasibility study and secure strategic project financing. We are fortunate to have a strong balance sheet to comfortably fund the Sayona investment without compromising our aggressive plans in North Carolina.”