St George Mining Limited (ASX: SGQ) has secured a strategic placement from Shanghai Jayson New Energy Materials Co., Ltd, a globally significant supplier to the clean energy sector and becomes St George''s largest shareholder with a holding of 11.73%.
Jayson is the world''s leading producer of cathode precursor materials for lithium‐ion batteries and has established a diversified vertical supply chain for energy materials that extends from upstream mining to downstream precursor manufacturing.
"This is a group with deep financial capacity and technical capabilities in lithium‐ion battery technologies, mining, chemical engineering, and battery materials manufacturing," said John Prineas, St George''s executive chairman.
"St George is delighted at this additional investment – a clear demonstration of Jayson''s faith in the potential of the company''s lithium projects that builds on its initial investment in St George a year ago.”
Jayson and St George have entered into a subscription agreement whereby Jayson (through its controlled subsidiary Hong Kong Jayson Holding Co., Limited) will acquire nearly 79M fully paid shares in St George at an issue price A$0.038 each to raise A$3M.
Proceeds from these placements will be applied towards the company''s flagship Mt Alexander Lithium Project, along with other prospective lithium projects in Western Australia, and as working capital.
St George and Jayson will collaborate on various commercial opportunities to leverage Jayson''s substantial financial and technical capabilities with a priority focus on maximizing the value of St George''s flagship Mt Alexander Lithium Project.
Global battery industry giant Shanghai Jayson New Energy Materials became St George''s largest shareholder during the year after ploughing another $3 million into the Perth-based lithium explorer''s stock. The investment comes about a year after an initial $2m investment and the latest move takes Jayson to the top of St George''s share register with 11.73 per cent of its stock.
Jayson is the world''s leading producer of lithium-ion battery cathode materials and is chaired by Chinese clean energy sector investor Feng Liang. Liang is also the major shareholder and Chairman of Shanghai Putailai New Energy Technology, a US$7 billion Shanghai-listed lithium battery anode material manufacturer.
St George initially enjoyed some success with nickel at its flagship Mt Alexander project in central WA however it attracted the attention of Jayson and other big battery players when it also discovered lithium at Mt Alexander and elsewhere in Western Australia.
''St George is delighted at this additional investment – a clear demonstration of Jayson''s faith in the potential of the Company''s lithium projects that builds on its initial investment in St George a year ago.''
Exploration results at Mt Alexander last year showed very high-grade lithium hits going 1.8 per cent lithium oxide from surface down to depths of 300m. The company''s Manta prospect within Mt Alexander also quickened a few pulses during the year when it threw up ultra-thick, flat lying pegmatites – that can often be lithium bearing – up to 121m thick.
In what looks to be an in-the-money quinella, St George also captured the attention of the world''s leading lithium battery maker last year when Amperex Technology Ltd (ATL) picked up 10 per cent of St George subsidiary Lithium Star which has pulled together a formidable hand of seven lithium projects spread across WA. ATL put up $3m to pick up 10 per cent of Lithium Star whose projects do not include Mt Alexander and three other St George projects.
Mr Prineas said Mt Alexander represents a "dominant" landholding in the emerging Mt Ida lithium province and predicted the company could control more than 16km of a prospective pegmatite corridor parallel to the lucrative Copperfield Granite. He said the Jayson partnership would be key to developing ground in a region that has already attracted the interest of at least two of Australia''s billionaires with both Gina Reinhart''s Hancock Prospecting and Chris Ellison''s Mineral Resources already active in the region in addition to IGO.
St George''s says Its landholding at Mt Alexander has extensive exposure to the contact between the Mt Alexander greenstone sequence and the Copperfield Granite, which is part of a large, regional lithium-caesium-tantalum (LCT) corridor that hosts Delta Lithium''s major discovery of 14.6 million tonnes at 1.2 per cent lithium oxide at its nearby Mt Ida project.
St George''s areas of interest include an 8km‐long zone around its Manta prospect, where drilling intersected the 121m-thick fractionated pegmatite and a 4km‐long zone at its Jailbreak prospect that has thrown up drill intersections from multiple lithium‐bearing pegmatites with values of up to 1.8 per cent lithium oxide and rock‐chip samples returning values up to 3.25 per cent lithium oxide.
Jayson''s interest in St George looks to be twofold – whilst it seems prepared to ride the lithium exploration and discovery roller-coaster, its real interest appears to be in the lithium off-take for any St George discoveries – 25 per cent of which it will have the right to purchase.
The latest findings by the International Energy Agency regarding electric vehicles noted sales are set to increase by about 2.75 times by 2030. The agency also predicts that by 2030, 65 per cent of all cars sold in the European Union will be electric and 100 million EVs will be on the road in China.
All of which augers well for the $33m market-capped St George which is rapidly assembling an army of well-healed funders that have a vested interest in it finding the next big lithium discovery.
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