Mining shell Ausroc Metals has received shareholder support for a reverse takeover of unlisted public company Woomera Exploration, which has a portfolio of projects prospective for lithium, cobalt and nickel.
Shareholders this week approved the acquisition as part of a recapitalisation proposal aimed at pulling the company out of liquidation.
In its past life, Ausroc Metals (ASX:ARK) — which also previously went by the name of AusAmerican Mining — was an ASX-listed explorer looking for base and precious metals in Africa and the US.
Liquidators were appointed to the company in August 2016. Ausroc has been suspended from the ASX for three years.
The company has now reached an agreement with its creditors and is working to complete the acquisition of Woomera Exploration and re-list on the ASX.
$7 million capital raising
Ausroc, which will be renamed Woomera Mining, has filed a prospectus to raise up to $7 million via the issue of shares at 20c each, with the offer to open on December 20.
With the acquisition of Woomera Exploration, Ausroc will make its foray into the battery metals arena that has investors excited at the moment.
One billion electric cars will be on the road by 2050, driving huge demand for battery metals such as Lithium and cobalt.
Woomera Exploration has struck a conditional deal to acquire Volt Lithium and Liquid Lithium, which together own a tenement package located in Western Australia that is “highly prospective” for hard-rock lithium and potentially lithium-rich brines.
Lithium brines are more cost effective to bring into production than hard-rock sources. Most lithium brine production comes from Latin America.
“The lithium targets are something that we could quickly exploit because we already have enough information,” Don Triggs, exploration director for Woomera Exploration, told Stockhead.
“We’ve got these lithium-bearing pegmatites running through those blocks in the Pilbara and they’re also on the Strelley-Wodgina lineament, which hosts the three other lithium-tantalum mines in the area.”
While the hard rock, spodumene-bearing pegmatites are a “much more definite and known target” for Woomera, the company will also have a crack at any potential lithium-rich brines.
“We think it’s innovative, we know it’s new for Australia and these lake systems we know are surrounded by igneous and volcanic provinces and also the water in them comes from paleochannels,” Mr Triggs said.
“They’ve been there in some cases for 3000 million years and they just fit the criteria for brines that contain lithium, boron and potash.”
Woomera Exploration also has nine tenements in the Gawler Craton and Musgrave regions of South Australia.
Much of the company’s ground has historically fallen under the Woomera Prohibited Area – a large area of South Australia quarantined for military purposes for over 50 years and only recently opened up for mineral exploration.
The tenements in the Musgrave region are believed to host nickel, copper and cobalt, as well as Broken Hill-style silver, lead and zinc, and rare earths.
ASX listing due in March
The Gawler Craton region, meanwhile, is considered prospective for nickel and copper sulphide mineralisation and intrusion related gold as well as iron oxide-copper-gold-uranium mineralisation similar to BHP Billiton’s large Olympic Dam mine in South Australia.
Ausroc’s capital raising is due to close on February 15 ahead of an anticipated March 1 listing on the ASX.
Depending on how much is raised, the company plans to spend between $428,900 and $1.2 million on exploration of the Gawler Craton projects and the Western Australian lithium projects in the first year post-listing.
Ausroc has around $220,000 cash on hand prior to completing its capital raising.
The company is confident it will have no trouble raising the cash and relisting. “We’ll be well and truly fully subscribed,” Mr Triggs told Stockhead.
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