Arizona Lithium raises $23.2m to fund Big Sandy project

Lithium play Arizona Lithium (ASX: AZL) entered a trading halt today following revelations that the company is hitting up investors for $23.2m to help advance its Big Sandy project in the US.

An equity deal launched by Evolution Capital and PAC Partners on Wednesday is looking for buyers at 12.5¢ a share, which is a 16.7% discount to the last close.

Under the proposed deal, shares sold will have an attached option, on a one for two basis, and are exercisable at 18¢ in the coming 24 months.

Arizona Lithium, formerly Hawkstone Mining Limited, reserves the right to raise an additional $9.3m in oversubscriptions.

According to terms sent to potential investors, proceeds from funds raised are being earmarked for a demonstration/pilot plant at Big Sandy, potential associated land purchases and exploration.

What is the Big Sandy project?

Arizona is currently pursuing a Permit of Exploration (“POE”) for its Big Sandy Lithium Project.

To the uninitiated, the Big Sandy Project is a shallow, flat lying mineralised sedimentary lithium resource which is understood to have an excellent available infrastructure with the potential to be developed with a low environmental footprint.

Arizona’s 2019 drill program at Big Sandy resulted in the estimation of a total Indicated and Inferred JORC resource of 32.5m tonnes grading 1,850 ppm Li for 320,800 tonnes Li2CO31.

This represents 4% of the Big Sandy Project area that contains an estimated exploration target of between 271.1Mt to 483.15Mt at 1,000 - >2,000ppm Li2.

Arizona is expected to resume trading 1 April pending it releasing an announcement.

The company is expected release a quarterly update on 29 April 2022.

Arizona Lithium's share price has bounced higher over the last six months.