Lithium miner Galaxy Resources Ltd [ASX:GXY] has resumed trading today after entering into a trading halt on Friday.
Upon resuming trade, the miner’s share price has jumped up 4.72%, and is currently trading at $2.22 per share.
Galaxy Resources trading halt details
Galaxy announced last Friday it had requested a trading halt pending an announcement regarding the sale of a package of tenements, located on the northern area of the Salar del Hombre Muerto in Argentina to POSCO.
POSCO [NYSE:PKX] is a South Korean steel-making company that flags itself as the most competitive steel maker in the world.
In an update made this morning, Galaxy announced it has completed the sale of tenements to POSCO, following the registration of the tenement and usufruct transfers.
The sale will see Galaxy receive a total of US$271.6 million.
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US$257 million will be held in escrow plus interest accrued will be released by the Escrow Agent to Galaxy by Tuesday 26 February 2019. POSCO will pay US$14.6 million to Galaxy directly by Friday 1 March 2019.
The total price of the sale is a little lower than the company initially indicated in their December Quarterly Update, stating a final consideration of US$280 million.
What’s next for Galaxy Resources share price?
The sale of its tenements has given the company a sizeable war chest to help develop its other two projects at Mt Cattlin and James Bay.
At the end of the last quarter Galaxy had a cash and liquid assets balance of US$41.1 million and zero debt. This sale will bring its cash balance up towards the US$312 million mark.
Galaxy completed its Yield Optimisation Project at the end of last year with commissioning 85% complete. Proceeds from the Salar del Hombre Muerto sale are likely to help complete the commission as well as fund exploration of the project.
Galaxy is targeting total production volumes in the range of 40,000 tonnes to 45,000 tonnes in Q1 of 2019 and 180,000 tonnes to 210,000 tonnes for the full calendar year.
The Environmental and Social Impact Assessment (‘ESIA’) was completed and submitted to various authorities for evaluation in Q4 2018 for the James Bay Project.
Phase 2 test work is estimated to be 50% complete for the James Bay upstream operation, while a competitive bid process to select engineering firms to undertake the feasibility study integrating a downstream conversion facility into the project design was completed.
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