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Paynes Find Gold Ltd acquires advanced major lithium project in Austria

Paynes Find Gold Ltd acquires advanced major lithium project in Austria

Paynes Find Gold Ltd (ASX:PNE) is seeking to become a lithium miner through the reverse takeover and backdoor listing of European Lithium Limited, the sole owner of the well advanced Wolfsberg Lithium Project in Austria.

Tony Sage will become a director of the company, as Cape Lambert Resources Ltd (ASX:CFE) owns 26.2% of the pre-raising capital in Euro Lithium.

The current vendors have already spent €11.53 million on the acquisition and exploration of the Wolfsberg project, which has an inferred resource of 3.7 million tonnes at 1.5% Li2O (55,500 tonnes contained lithium).

Drilling is set to commence fast to upgrade the resource.

A bulk sample of 1,000 tonnes will be collected for metallurgical test work. A Bankable feasibility study is slated to commence immediately after completion.

While production could occur as soon as 15-20 months from acquisition. This should be enough for the stock to soar upon relisting.

Under the terms of the deal, Paynes Find will acquire the European Lithium subsidiary owning the project, in exchange for $750,000 in cash and 187.5 million in shares worth $15.6 million valued at Paynes Find’s last traded price.

Paynes Find will also issue 62.5 million shares subject to the completion of certain milestones, and will pay a further $1.5 million once the transaction has been completed.

As the proposed acquisition will result in a change in the nature and scale of the business, Paynes Find will be required to complete a minimum $6 million capital raising in order to comply with ASX relisting rules.

The current owners had completed 17,000 metres of drilling and 1,400 metres of declines, drives and crosscuts at the Wolfsberg project, which will allow the company to examine routes to fast track the development phase.

Additional drilling at the project will commence before completing the transaction with a view to define an upgraded resource estimate.

The central European location of the project will allow the company to help meet the high demand for lithium in the EU, which consumes 24% of the global market, second only to China.

Interestingly, the project is situated just 40 kilometres from the Samsung battery plant in Graz, Austria.

 

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