Here is the transcript:
Rachael Jones: Hello. I'm Rachael Jones for the Finance News Network. Joining me from Lepidico (ASX:LPD) is Managing Director Joe Walsh. Joe, welcome back to FNN.
Joe Walsh: Good morning, Rachael. Good to be here.
Rachael Jones: Good to see you. Now, Lepidico is targeting commercial production of 5,000 ton per annum lithium carbonate equivalent by 2023. What can you tell me about this?
Joe Walsh: We completed the definitive feasibility study for our Phase 1 project earlier this year. We're now moving it towards a final investment decision targeting the second quarter of next year. And then, we'll be eyeing first production in early '23 when we ramp up that plant in Abu Dhabi for producing lithium hydroxide.
Rachael Jones: Thanks, Joe. Now to your strategic collaboration and technology licence agreement with Cornish Lithium. What does this involve?
Joe Walsh: So, we announced this at the beginning of the week, and we've entered into a strategic collaboration arrangement with Cornish Lithium. They have interests in the south-west of England, and those deposits are amenable to being treated with Lepidico's proprietary process technologies. So, Cornish Lithium has spent about six months doing due diligence and spent about a quarter of a million dollars on test work using our technologies. And what this arrangement will mean is they'll have a process technology to treat these mineralisations in Cornwall and produce not just lithium hydroxide, but also the byproducts that our processes allow. So, it really is a strategic tie-up here on something of a different style of mineralisation to what we see at our project in Namibia.
Rachael Jones: And what can you tell me about the repayment of convertible notes?
Joe Walsh: So, this was an important part of balance sheet repair for Lepidico. So, the $4 million Canadian proceeds from the transaction with Cornish Lithium has already been used to retire in full that convertible notes debt obligation that we had. So, Lepidico is now debt-free with a healthy cash position to see it into 2021.
Rachael Jones: Now, let's talk about your Phase 1 project. Could you provide an update on the mining operation in Namibia?
Joe Walsh: So, the assets in Namibia are all ready to go. It's fully permitted there for the mines and the building of that small concentrator. Since we last spoke, we've completed the environmental social impact assessment there, and that's evaluated the project as a Category B project under the IFC standards, which is extremely unusual for a mining project. And it really goes to the heart of us having very good environmental and social credentials at all of our projects.
Rachael Jones: And what can you tell me about the chemical plant in Abu Dhabi?
Joe Walsh: So, that's tracking a little bit behind the mine and the concentrator. We are working on the environmental social impact assessment for the Abu Dhabi chemical conversion plant now. We're on track to have that completed by the end of this quarter, by the end of this month. And we should have all approvals and permits in place before the end of the next quarter, which really should set us up nicely for that planned final investment decision.
Rachael Jones: And Joe, what can you tell me about the US Government interest in the project?
Joe Walsh: At the end of October, we entered into a mandate arrangement with the US Government's Development Finance Corporation for provision of debt funding for the Namibian part of the phase one development. This is some fairly hard funding to be able to get. The requirements are quite onerous, but again, because of our excellent environmental and social credentials, it does mean that we have an opportunity to get this type of funding, which has extremely attractive fundamentals to it for our shareholders. It's very low-cost funding.
Rachael Jones: That's excellent news. And to the last question now, Joe, is there anything else you'd like to add?
Joe Walsh: So I think that, just following on from DFC's interest, the other element to that is the US State Department's list of 35 critical minerals. And I think that our Phase 1 project is unique globally in that it will produce four of those 35, and in particular, caesium and rubidium, which aren't just critical, but they're also strategic in nature. So, we are looking at leveraging those unique elements associated with our project, because we believe it's the world's only ore reserve and mineral resource of caesium, rubidium and lithium, to be able to bring a new source of supply of those three critical minerals to the market.
Rachael Jones: Joe Walsh, thanks for the update. Good to see you again.
Joe Walsh: Thank you very much, Rachael.
Ends
Expand
(20min delay)