Reabold Resources to buy stake in Spanish lithium-tin project

Shares in Reabold Resources rose after the natural resources investor said that it will buy a 2% stake in the San Jose lithium-tin project in Spain for about £300,000 (AU$500,000).

The project is a joint venture between Australian miner Plymouth Minerals’ subsidiary Tonsley Mining and Sacyr, a Spanish multinational infrastructure and services company.

The acquisition is in line with the company’s strategy to identify strategic mineral opportunities with the potential to add significant shareholder value.

A placing of 73.5m shares of 0.1p each to be sold at a price of 0.5p each will raise £367,500 to fund the acquisition and for working capital. The new shares will be admitted to trade on AIM on 25 April and following admission the company will have 394.41m shares in issue.

This will buy a 2% stake in Tonsley, which will have the right to earn a 75% interest by spending €1.5m for a first stage 50%, then €2.5m for the additional 25%, which is being funded by Plymouth in the project.

The company said that the project has achieved “exceptional” metallurgy results with 97% lithium recovery made in first stage metallurgical testwork, using sulphuric acid processing routes.

Mineralogy also confirmed that the project has ore that is amenable to simple beneficiation in line with a previous feasibility study.

Reabold chairman Jeremy Edelman said: “With the current dynamics surrounding the fast growing European lithium market, the company sees tremendous opportunity in this rapidly developing San Jose lithium-tin project together with the project's development partners as they continue to add quantum steps of value to the project through their experienced personnel and professional operational skills.

“We see the San Jose lithium-tin project as a potential company making investment going forward.”

He said the company and Plymouth will also be holdings talks about future opportunities to potentially increase Reabold's corporate and operational involvement in project.

Shares in Reabold Resources were up 19.19% to 0.900p at 0807 BST.