Lake Resources (ASX:LKE) - Managing Director, Steve Promnitz
Managing Director, Steve Promnitz
Source: The Market Herald
Market Herald logo


Be the first with the news that moves the market
  • Lake Resources’ (LKE) receives an expression of interest (EOI) from the UK Export Finance
  • The UK-based export credit agency is interested in funding about 70 per cent of the total finance required for Lake’s Kachi Lithium Project in Argentina
  • Lake Resources considers this as an “enormous vote of confidence” in its clean energy project as the demand for batteries and electric vehicles accelerates
  • The EOI is subject to Lake completing a definitive feasibility study and an environmental and social impact assessment which is expected before the end of the 2022 March quarter
  • Company shares are up 9.57 per cent to trade at 63 cents

Lake Resources’ (LKE) Kachi Lithium Project has generated some interest from the United Kingdom’s export credit agency (ECA).

The UK Export Finance (UKEF) submitted a formal expression of interest (EOI) to cover around 70 per cent of the Argentina-based project’s required funding.

In the last five years, the UKEF has provided £14 billion (A$26.3 million) of funding support for UK exports and international trade.

Lake Resources Managing Director, Steve Promnitz, said he was pleased to have received the interest.

“This offer is a watershed moment for Lake – to have a leading ECA willing to indicate financial support for Kachi provides an enormous vote of confidence in our clean energy project. The support reflects not only Kachi’s robust financials but also its considerable environmental, social and governance (ESG) benefits.”

The potential support provides a much lower cost of capital than traditional debt financing with the principal repaid over an 8.5-year period post-construction.

The EOI indicates the total funding could be increased to include 70 per cent of an expanded production plant to 50,000 tonnes per annum of high-purity lithium carbonate equivalent.

This aligns with the accelerating demand from leading battery and electric vehicle makers for sustainably produced and high-quality lithium.

The EOI is subject to some conditions such as structured offtake contracts, the completion of Kachi’s definitive feasibility study (DFS), and an environmental and social impact assessment (ESIA).

According to Lake, the DFS and ESIA are in the advanced stages and are expected to be completed by the end of the first quarter of 2022.

“Essentially, this EOI is stating that if Lake does what it says it’s going to do in the DFS and ESIA, the project will be funded. Combined with backing from potential international off-takers, investors will increasingly see progress towards successful production and expansion of Kachi, perfectly timed to meet the needs of a decarbonising world,” Mr Promnitz concluded.

Company shares were up 9.57 per cent to trade at 63 cents at 10:08 am AEST.

LKE by the numbers
More From The Market Herald

" Beacon Minerals (ASX:BCN) declares fully franked dividend

Beacon Minerals (BCN) has declared a fully franked dividend of 0.125 cents per share.

" Alchemy’s (ASX:ALY) subsidiary wins tenement ballots at Lake Rebecca

Alchemy Resources’ (ALY) subsidiary, Goldtribe Corporation, has won ballots for three exploration licence applications within ALY’s Lake Rebecca Project in Western Australia.

" Tigers Realm Coal (ASX:TIG) recounts positive September quarter

Tigers Realm Coal (TIG) has released its quarterly report for the three months ending September 30.

" Chase Mining’s (ASX:CML) Red Fox applies for more tenements in Queensland

Chase Mining’s (CML) 40 per cent-owned company Red Fox Resources has applied for another three exploration permits in northwest Queensland.