Salt Lake Potash raises A$28 million via share placement to ramp up Lake Way Project

Salt Lake Potash Ltd (ASX:SO4) (LON:SO4) (OTCMKTS:WHELF) (FRA:W1D) has received binding commitments to raise A$28 million via a share placement to institutional shareholders, sophisticated investors and directors at 35 cents per share.

This will enable final debt drawdown and access to additional funding through a bank guarantee provided by Sequoia and ramp-up of the Lake Way Project in Western Australia.

Background

In August 2020, SO4 executed the US$138 million SFA (syndicated facility agreement) with Taurus and CEFC, with the initial US$105 million drawdown undertaken in December 2020 and the subsequent syndication to SEQI and CBA occurring in early March 2021.

Importantly, the new placement is a key condition to enable SO4 to undertake the final US$33 million drawdown under the SFA, as well as providing for the implementation of an A$18 million guarantee facility to be provided by SEQI in support of the gas pipeline constructed by APA Operations Pty Ltd.

The guarantee facility provided by SEQI will release A$18 million in equity that will be used along with the proceeds from the placement for general operating expenses during the ramp-up of the Lake Way Project.

“New long-term export industry for Australia”

SO4 Chief executive officer Tony Swiericzuk said: “SO4 is pleased to have completed this placement of A$28 million to enable final drawdown under the SFA.

“The company can now focus on ramping up production as we move to first revenues from the Lake Way Project in the very near-term.

“I would like to extend my sincere thanks to our shareholders for their continued support of the project, our company and the development of a new long-term export industry for Australia.”

First SOP reconfirmed for June’21 quarter

SO4’s commissioning of the process plant at Lake Way commenced in March with the introduction of harvest salts to the front end of the plant.

26 of the 34 process units in the plant have now commenced commissioning.

The construction is also largely complete with the first SOP (sulphate of potash) reconfirmed for the June 2021 quarter:

• Structural steel is complete
• Tanks are 100% complete
• Piping is >95% complete
• Electrical terminations are >95% complete and cable pulling >95% complete

Story by ProactiveInvestors