Kodal raises US$2m for Bougouni development

It placed 1.15 billion ordinary shares at 0.013p per share, with 20% shareholder Suay Chin International subscribing £1.2 million for another 923.1 million shares, bringing its total shares in Kodal to 2.2 billion, representing 29% of the issued share capital.

The subscription shares will be issued and admitted to trading on AIM after receipt of the proceeds from Suay Chin by 6 July.

The remainder of the funds were raised via the placement of 230.8 million ordinary shares with existing and new shareholders, with these shares expected to be admitted to trading on AIM on or around June 15.

The fundraising comes just over a week after Kodal identified high-grade lithium mineralisation intersections at the project's Sogola-Baoule prospect.

Kodal CEO Bernard Aylward said the continued financial support from Suay Chin was welcome and the two companies would continue to work together on Bougouni's metallurgical test work and bulk sampling to progress the project as rapidly as possible.

"As part of the initial investment by Suay Chin, Kodal and Suay Chin have agreed to negotiate a binding off-take agreement as the project advances to development, and this further investment by Suay Chin confirms its confidence in the Bougouni lithium project and the interest in securing supply of the spodumene concentrate," he said.

Kodal previously reported that tests by large lithium carbonate producer by Shandong Ruifu Lithium had produced a high-quality, low impurity battery grade lithium carbonate from Bougouni's spodumene concentrate.

Aylward noted the encouraging results from metallurgical and processing test work underpinned the project's potential commercial value.

"In line with this, we will be working towards the development of a maiden resource estimate over the summer months once we receive the assay results from the most recent drill programme. In the meantime, these new funds from Suay Chin and other investors will allow us to plan with confidence for the next drilling season later this year," he said.

Kodal's broker and financial advisor SP Angel said the increased investment from Duay Chin demonstrated its continuing enthusiasm to move the Bougouni project nearer to production.

"We look forward to the forthcoming initial mineral resource estimate in order to provide an insight into the Bougouni project in relation to other developing lithium projects," the broker said.

Kodal's shares were trading at 0.14p Monday, down 5.38%.