Sigma Lithium raising C$30M to advance Brazilian lithium project

Sigma Lithium Resources Corp. intends to raise up to C$30 million in a private placement to advance the Grota do Cirilo lithium project in Brazil and to increase financial flexibility.

The company plans to issue up to 7,500,000 shares priced at C$4.00 apiece. The offering is scheduled to close by Feb. 10.

Sigma said Feb. 2 that it plans to use the proceeds to fund workstreams at Grota do Cirilo, which the company is upsizing to solidify its position as a future supplier of low-carbon, high-purity, 6% battery-grade lithium concentrate.

As part of the project's phase-two production development planned for 2023, Sigma plans to update a 2019 technical report on the project and deliver a feasibility study. The company also plans to carry out a 20,000-meter diamond drill campaign and complete a preliminary economic assessment as part of predevelopment work for phase-three production from 2024 to 2025. Sigma also aims to fund programs to mitigate the project's environmental and social impacts.

In addition, the company is looking to set aside US$5 million of the proceeds to its savings account. This would increase the maximum amount the company can draw from the project finance facility with Société Générale SA to US$50 million from US$45 million and bring the total equity allocated for the project finance to US$15 million from US$10 million.

XP Investments US LLC, Cormark Securities Inc. and National Bank Financial Inc. acted as the company's financial advisors. A10 Group, whose certain principals are directors, officers or indirect significant shareholders of Sigma Lithium, will also provide services related to the offering.