This will take place through the purchase of an equity stake in IRR, staged project investments to earn a 50% stake in IRR’s Ghana-based portfolio and a binding supply agreement for 50% of IRR’s Ghana-planned spodumene concentrate production.
IRR Ghana has an impressive portfolio of spodumene products, anchored by the highly promising Ewoyaa project, which has a current mineral resource of 14.5 million tones at 1.31 lithium oxide and vast exploration potential.
Builds on strategic commitment
Speaking to the investments, PLL president and CEO Keith Phillips said: “We consider IRR’s Ewoyaa Project to be among the world’s most promising spodumene projects.
“The high-grade mineral resource is currently modest in scale but offers substantial exploration potential, and the project is very well-located being only 70 miles from a major port.
“Ewoyaa builds on Piedmont’s strategic commitment to be a large-scale and low-cost producer of lithium hydroxide from spodumene concentrate sourced from diverse sustainable resources in favourable jurisdictions.”
The subscription is expected to close in August 2021 subject to satisfaction of conditions precedent with the project investment expected to be staged over a three to four year period leading to initial production in 2025.
“A transformative year”
Phillips continued: “2021 has been a transformative year for Piedmont.
“We will now evaluate plans to capitalise on our expanded spodumene resource base to become a larger producer of the battery-quality lithium hydroxide that America will require to power the ongoing transition to electric vehicles.”
Piedmont will invest around US$15 million to acquire a 9.47% equity interest in IRR and will appoint one director to IRR’s board of directors.
The company will also have the opportunity to earn a 50% stake in IRR Ghana by investing:
- US$17 million to fund ongoing exploration and a definitive feasibility study over the next 24 months to earn an initial 22.5% project interest; and
- A further US$70 million in 2023-2025 to fund the construction of the Ewoyaa Project and earn an additional 27.5% project interest, which would bring the total to 50% ownership in IRR Ghana.
- Piedmont and IRR have also entered into a binding SC6 supply agreement, conditioned on Piedmont completing its earn-in obligations, pursuant to which IRR will supply Piedmont 50% of IRR Ghana’s planned SC6 production at market prices on a life-of-mine basis.