ASX-listed lithium company, Prospect Resources (Prospect) says discussions with Uranium One are still ongoing, but there is no guarantee that they will result in a formal binding agreement or any

In December last year, Prospect indicated that it had signed a memorandum of understanding with Uranium One, a wholly owned subsidiary of the Russian State nuclear energy firm, affording the Russian company a 90-day exclusive period to complete due diligence on Prospect and its Arcadia Lithium Mine.

After a 90-day period to complete due diligence, Prospect said the agreement would allow Uranium One to negotiate acquiring at least 51% of Prospect’s future lithium production from its flagship Arcadia Lithium Mine.

“The discussions with Uranium One are incomplete and ongoing and there is no guarantee that the MoU or any discussions with Uranium One will result in a formal binding agreement or proposal or as to the timing or terms on which any transaction may proceed,” Prospect said in its quarterly activity report ended December 31, 2019.

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Prospect said it finished the quarter with A$1,13 million cash at bank and subsequently up to December 31, 2019, it raised an additional A$0,97m.

It also has US$10 million funding commitment from offtake partner Sinomine on placement of ball mill.

Prospect will continue to focus on cost control while advancing discussions with Uranium One and Afreximbank.

In December last year, it appointed African Export-Import Bank (Afreximbank) to arrange and manage the primary syndication of a US$143m project finance debt facility.

Afreximbank is proposing to fund and hold US$75m of the facility. The parties have also agreed a non-binding indicative debt facility term sheet.

“The appointment of Afreximbank as mandated lead arranger is a critical milestone in the financing of the Arcadia lithium project in Zimbabwe. The parties will now undertake further detailed due diligence and negotiate the final facility agreements,” reads part of the report.

“Execution of the facility agreements will be subject to Afreximbank’s further due diligence and credit approvals and drawdown will be subject to satisfaction of various conditions precedent to be included in the agreements.”