Core Exploration Ltd (ASX:CXO) has received $1.4 million in funding from a share placement to a subsidiary of one of China’s largest lithium hydroxide and carbonate producers.
The placement is in addition to the initial $2.0 million placement to the same entity in August 2017 demonstrating the support for the company’s lithium projects.
Funds raised will provide Core with the ability to expand its regional exploration and resource focussed drilling within its Finniss Lithium Project in the Northern Territory.
READ: Core Exploration raising $2 million; lithium resource upgrade imminent
The placement is in the form of a subscription agreement with Ya Hua International Investment and Development Co. Ltd, owned by Sichuan Yahua Industrial Group Co. Ltd.
Sichuan Yahua is a A$2.4 billion A-share listed company on the Shenzhen Stock Exchange, and is one of China’s largest lithium hydroxide and carbonate producers, with significant expansion plans.
It has long-term stable relationships with a number of the large downstream customers of lithium batteries and has broad marketing and distribution channels.
Notably, Sichuan Yahua has significant business interesting in Australia including operations in Darwin.
Signals potential for off-take and development partners
The signing of this subscription agreement reflects the level of interest from potential off-takers and development partners for the high-grade spodumene at the Finniss Lithium Project.
Core is in the final stages of developing a pre-feasibility study (PFS) for the development of a spodumene concentrate and direct shipping ore (DSO) operation at Finniss.
The PFS was been fully funded by April’s $5 million placement and is expected to be delivered by the end of May following completion of an updated resource at the Grants deposit.