Lithium Development Company Lepidico Eyes Major Expansion

• Lepidico (LPD), an ASX listed lithium company, plans to develop two open pit mines in Namibia and build a chemical conversion plant in Abu Dhabi, with production expected by 2024.
• Lepidico recently hired an all-Namibian senior management team to oversee its Namibian operations.
• The company is attending conferences to meet potential equity investors and lenders, highlighting their progress and plans.
• There's significant interest in Lepidico's lithium project, with several majors from Asia and North America showing interest.
• The Abu Dhabi project, set in the kizzad industrial zone, is advancing quickly, with support from local authorities and the infrastructure being developed at no cost to Lepidico.

About Lepidico

Lepidico Ltd (ASX:LPD) is a lithium development company focused on upstream lithium assets and proprietary chemical processing technologies. The company has projects in Namibia, where it is working to redevelop two open pit mines and build a new concentrator. Lepidico also plans to construct a chemical conversion plant in Abu Dhabi, which will process the concentrates from Namibia using the company's proprietary technologies. Lepidico is targeting initial production in 2024.

Interview with Joe Walsh, MD, & Shontel Norgate, CFO of Lepidico

Key Expansion Plans Discussed at Mining Conference

At the recent Mining Indaba conference in Cape Town, Lepidico Managing Director Joe Walsh and CFO Chantal Norgate outlined the company's major expansion plans and funding strategy. With lithium prices surging amid booming electric vehicle demand, Lepidico aims to fast-track its projects to capitalise on strong market conditions.

The company has an intense focus on project financing, targeting the lowest cost of capital. For its Namibian operations, Lepidico is working with the U.S. Government's development finance arm, the International Development Finance Corporation (DFC). After passing an initial ESG screening, Lepidico entered a financing mandate with DFC and due diligence is now well advanced.

Lepidico expects to finalise DFC debt funding around August-September 2022. The DFC has stringent ESG requirements, so Lepidico has focused intently on sustainability and demonstrating benefits for local Namibian stakeholders.

Beyond DFC, Lepidico is also engaging local African banks and development financiers. Their terms may not be as favourable, but they can provide other services like trade finance. Getting the right financing mix is key.

Abu Dhabi Funding Progressing

In Abu Dhabi, Lepidico has been in detailed talks with commercial banks interested in funding its chemical plant. Export credit financing is another funding avenue, contingent on the source country for the equipment.

Lepidico completed a definitive feasibility study on the project in May 2020. While costs have risen amid inflation, higher lithium prices offset this impact significantly.

The land for the Abu Dhabi plant is being developed on pace, facilitating quick construction. Shared infrastructure in the Khalifa Industrial Zone Abu Dhabi (KIZAD) also benefits the project. Lepidico is positioning its Abu Dhabi operations as an enabler for the country's broader lithium-ion battery and electric vehicle manufacturing ambitions.

Major Milestones Targeted for Q3 2022

The company is targeting major milestones in Q3 2022. This includes finalising binding off-take agreements for lithium and key by-products, securing debt funding, and bringing in additional equity investors.

Infrastructure development at the Abu Dhabi site will be complete on schedule. Lepidico has built strong relationships with stakeholders in Abu Dhabi, who see the strategic value of having a fully-integrated lithium chemicals facility located in the emirate.

Conclusion

With its projects advancing rapidly, Lepidico appears well-positioned to capitalise on surging lithium demand. Its focus on project financing highlights fiscal discipline and minimising shareholder dilution.

Lepidico's proprietary technologies and strategic footholds in Namibia and Abu Dhabi give it key advantages. The company has successfully navigated early development hurdles like ESG screening for DFC funding.

While risks remain, Lepidico has an executable strategy and targeted timelines. Major milestones expected in Q3 2022, including binding off-takes, financing and equity investment, make this a pivotal period for the company. Lithium's supply/demand imbalance bodes well for asset developers like Lepidico progressing projects towards production.