Despite the additional engineering requirements of resizing the LSPP, LIT remains confident that the studies required for commitment to construction of the plant will be complete in the coming quarter as these plans are well advanced.
LIT is also reassessing the pilot plant location to optimise technical and financial benefits.
The changing policies of the Australian federal government, with respect to support for research and development, have had a significant impact on the company’s plans.
Unfortunately, the Australian jurisdiction is becoming less favourable when compared with many other locations.
The location of the LSPP will take into account the principal financial considerations together with intangibles such as the ability to manage research & development in offshore jurisdictions.
The planned reduction of capital exposure has placed LIT in a position within which the Arena Investors convertible note facility is presently not the optimal funding mechanism for its immediate requirements.
Consequently, the facility has been terminated in its current form.
The company is continuing to evaluate the most effective financing options to complement its strategic agenda.
LIT Managing Director Adrian Griffin said: “Changing our pilot plant strategy and reducing capital exposure is in the interests of all shareholders.
“The support of Arena has been very important to our strategy and it is unfortunate that changes in government policy have had such an impact on our research and development plans.
“We thank Arena for its support and look forward to engaging with it as a key investor in any future relationship.
“Lithium Australia will locate its R&D activities in a jurisdiction that will provide the greatest practical benefits to its shareholders.”