20th Jun 2024 12:18
(Alliance News) - Savannah Resources PLC on Thursday said it entered into a partnership to further the development of its flagship lithium project.
The European-focused lithium development company has partnered with AMG Critical Materials NV Group, a global critical minerals business.
AMG's German subsidiary has invested GBP16 million into Savannah through a subscription for 342.6 million shares at a price of 4.67 pence each to become the company's largest shareholder.
Savannah shares were up 11% to 4.37 pence each in London on Thursday afternoon.
This investment will allow Savannah to reach a final investment decision regarding its flagship Barroso lithium project in Portugal, Europe's largest lithium deposit.
The partnership also includes an offtake heads of term agreement. Once finalised, AMG will purchase 45,000 tonnes per annum of spodumene concentrate from the project, approximately 25% of the total, for a five-year period based on prevailing market prices at the time.
AMG also will assume a lead role in securing future financing to develop the project which, if successful, will extend the offtake arrangement to 90,000 tonnes per annum for 10 years.
Savannah Chief Executive Officer Emanuel Proenca said: AMG "is a long established, listed and profitable global metals business with a lithium upstream business that is probably the best placed to serve the booming battery and EV production sector in Europe. All stakeholders can now be certain that the first batches of Savannah's future spodumene concentrate production will be going into lithium chemical production in Europe, for the European lithium battery value chain."
Savannah is now fully funded to complete all planned work including, the definitive feasibility study, environmental licencing process, team expansion, and relevant land acquisitions, it highlighted.
By Elijah Dale, Alliance News reporter
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