Canada’s Export Agency Expresses Interest in Lake Resources’ Kachi Lithium Project
September 28 (Reuters) – Australia Lake Resources NL LKE.AX said Tuesday that the Canadian Export Credit Agency expressed interest in providing low-cost financing for the company’s $ 540 million Kachi lithium development in Argentina, in the latest sign of confidence in the project.
Lake Resources said Export Development Canada has indicated it is interested in joining UK Export Finance to provide 70% of the total funding required for the development of the project.
The inclusion of the Canadian agency would not increase the level of potential funding for the project in Argentina, which is home to the world’s third largest reserve of materials essential for batteries for electric vehicles, but increases the flexibility of supply.
“Having the direct sovereign loans from Canada alongside the sovereign backing of the United Kingdom significantly reduces the risks of the project for investors and international banks who continue to express a strong interest in participating in the development of Kachi,” said Steve Promnitz , Managing Director of Lake Resources.
He added that the company “has important work” to do in converting expressions of interest from the two export credit agencies into committed financing deals, but the deals have created a roadmap.
Lake Resources announced last week its partnership with California-based Lilac Solutions to jointly develop the Kachi project. Lilac will provide clean technology expertise and invest around $ 50 million in development, which will allow it to take 25% in the future.
The project is expected to produce 25,500 tonnes per year from 2024 with a possible extension to 50,000 tonnes. The price of lithium has jumped over the past year amid growing demand for batteries that use the white metal as part of a global push towards greener modes of transportation.
(Reporting by Sameer Manekar in Bengaluru; editing by Jane Wardell)
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