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Daily Telegraph
27-05-2025
- Business
- Daily Telegraph
DLI gold spin-off Ballard has the right stuff
Don't miss out on the headlines from Stockhead. Followed categories will be added to My News. Special Report: While junior explorers branching off non-core assets is hardly uncommon, it's not every day that a spin-off begins life with a gold asset with defined resources above the million-ounce mark. Delta Lithium's spin-off Ballard Mining will debut with a resource of more than a million ounces of gold Ballard will have an experienced team including chairman Simon Lill and Delta's chief development officer Paul Brennan as its MD Post-IPO activity will include drilling to boost existing and find new resources as well as work towards development That's exactly the exalted position that Delta Lithium's (ASX:DLI) spin-off Ballard Mining will enjoy once it hits the ASX, given that it will hold the Mt Ida project that has an inferred and indicated resource of 10.3Mt grading 3.33g/t, or 1.1Moz of contained gold following a recent resource upgrade. The upgrade came after Delta let the market know about the gold prospectivity of Mt Ida, where an initially modest gold resource had been defined from its lithium-focused drilling, then supercharged by targeted gold drilling over the last 6 months. Managing director James Croser told Stockhead in a video interview in late May that the company decided to spend $5-6m in September 2024 to specifically target gold. This proved to be money well spent after it delivered a resource that exceeded the company's target of a million ounces – the magical point where potential project lenders sit up and take notice. While no doubt thrilled by the find, the company then decided on a spin-off as it felt the funds used for drilling for gold had originally been raised for lithium exploration and Delta needed to honour that lithium commitment. Croser said that while the gold was a wonderful distraction to have, it not desirable to utilise cash raised from lithium investors for the significant sums needed to test the large gold potential at Mt Ida. 'It will take … $25-30m to advance the Delta gold assets at Mt Ida and we decided the best way to do that was in a separate vehicle,' he noted. Golden credentials This led to the decision to spin-off Mt Ida into Ballard Mining, which will raise between $25m (minimum subscription) and $30m (maximum subscription) through an initial public offering priced at 25c per share to fund exploration. Delta shareholders will retain exposure to the gold asset as they will receive one fully paid Ballard share for every 11.25 Delta shares they own as part of the spin-out while Delta itself will hold between 46% and 49% of the new company depending on the take-up of the IPO. 'Ballard will be raising $30m and that'll be 100% dedicated to gold exploration growth and development at the Mt Ida gold asset and Delta gets to ride that wave. (We) will still be exposed via our shareholding in Ballard but we will be a pure lithium business,' Croser said. While this funding will allow the new gold company to go all out with exploration, the composition of its leadership is also headline-worthy. Chairing the board will be Simon Lill of De Grey Mining fame while Delta's chief development officer Paul Brennan will be leaving to take up the helm as Ballard's managing director. Lill oversaw De Grey from its beginnings as a gold minnow and through its explosive growth following discovery of the renowned Hemi asset and its eventual acquisition by Northern Star (ASX:NST), which wrapped up in May this year. Former Ramelius Resources (ASX:RMS) and Wildcat Resources (ASX:WC8) chief financial officer Tim Manners will also step down as a non-executive director of Delta to take up an executive position at Ballard to assist Brennan. 'Stuart Matthews used to be the executive vice president of Goldfields Australia, so he'll be a non-executive director. And I'll be there as a non-exec looking after Delta's interests,' Croser said. Gold resources at Mt Ida. Pic: Delta Lithium Watch: Perfect timing for a golden move at Mt Ida Expansion plans This team will oversee an ambitious work program that could deliver significant progress towards a final investment decision for Mt Ida, which covers some 250km2 of ground. 'Ballard's going to be a very exciting proposition with $30m to spend on the growth piece at Mount Ida,' Croser said. 'They'll be exploring the 26 kilometres of strike around the Copperfield Granite, which really hasn't had any serious gold exploration outside the Baldock area for decades, if ever. 'Everyone's been drilling holes around the Baldock deposit, and that's yielded 930,000 ounces. So a big portion of the use of funds will be looking to expand the gold resources and find another Baldock.' He added that infill drill at Baldock could underpin a pretty good mine reserve. Besides Baldock, the recent resource upgrade also increased resources at the Kestrel deposit to 53,000oz at 1.7g/t gold and defined maiden contained resources of 33,000oz, 40,000oz and 11,000oz for the Bombay, West Knell and Jupiter deposits. The regional drilling and infill work at Baldock will help complete metallurgical and geotechnical studies to a DFS level and progress the project towards FID. A works approval has already been submitted for a processing plant with capacity of up to 1.5Mtpa and associated tailings storage facility. On listing Ballard will also start the process of converting exploration leases into mining leases for regional resources. In-principle approval for the demerger has already been received from the ASX. Delta itself will be busy carrying out exploration at the newly expanded Yinnetharra lithium project following the acquisition of the adjacent Aston project that gives it a dominant position over the Thirty-Three supersuite granites, which are proven to be the source for the Malinda and Jameson deposits. This article was developed in collaboration with Delta Lithium, a Stockhead advertiser at the time of publishing. This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions. Originally published as Delta spin-off Ballard's star team and big gold inventory will be its key drivers
The Australian
15-05-2025
- Business
- The Australian
DLI spins out Mt Ida
Special report: Delta Lithium has entered into binding agreements to demerge its full interest in the Mt Ida project to Ballard Mining, pending shareholder and ASX approval. Delta's Mt Ida asset will be spun out via a demerger and concurrent IPO A new, standalone and gold focused ASX-lister will be formed, named Ballard Mining Delta will retain upside exposure to Ballard through a substantial equity holding in Ballard As part of the proposed spin-out, eligible Delta Lithium (ASX:DLI) shareholders will receive one fully paid Ballard share for every 11.25 Delta shares they own, retaining exposure to the Mt Ida asset through an in-specie distribution. Ballard intends to conduct an initial public offering, targeting a raise of $25-30 million at 25c per share, to facilitate its proposed admission to the ASX official list. Following the demerger and successful IPO, Delta will maintain a significant interest in Ballard— roughly 49% at the minimum raise, and 46% at the maximum. The spin out paves the way for DLI to continue focusing on its primary business, being the exploration and development of its lithium assets at Mt Ida and Yinnetharra in WA. Potential for a standalone mining operation The decision follows an update to the inferred and indicated resource at the Mt Ida asset, now totalling 10.3Mt at 3.33g/t gold for 1.1Moz, significantly increasing the project's gold inventory and demonstrating the presence of a large system. DLI said the update represented significant potential upside for future exploration across the 250km2 Mt Ida tenement package (including pending tenure) and another 1,300km2 for water exploration. In light of its scale and viability as a standalone mining operation, Delta determined it was the right move to spin off the asset, a decision which comes at a time when lithium prices are depressed but gold prices are near record highs at close to A$5000/oz. Delta will remain as a lithium focused exploration and development company and will retain Delta's balance sheet strength by maintaining a significant shareholding in Ballard post demerger. Upon successful ASX admission, Ballard will allocate IPO funds to accelerate exploration at Mt Ida, including regional drilling and infill work at Baldock, aimed at completing DFS studies and progressing toward a final investment decision. Ballard, named after Lake Ballard – a local landmark in WA's Shire of Menzies famed for hosting the Gormley sculptures – will hold the gold asset through its shareholding in Mt Ida AU Pty Ltd, which will be a wholly owned subsidiary of Ballard. 'Opportune time in the gold price cycle' DLI managing director James Croser believes that the separation of the lithium and gold assets will create greater value for shareholders of both Delta and Ballard by enabling direct participation in the growth of the gold asset through an independent vehicle. "Delta has been working diligently towards this outcome for some time, and we are delighted to be finally able to announce these details of the demerger and Ballard IPO,' he said. 'Re-setting the exciting and prospective Mt Ida gold asset into Ballard, a pure new gold company, at such an opportune time in the gold price cycle best positions Ballard to launch into early success, underpinned by a strong foundation of 1.1Moz gold and a new dedicated and specialised management team. 'Momentum is crucial to a new listing and the pricing of the gold asset is compelling with significant potential to create investor returns and shareholder value.' Forecasters continuing to tip higher levels for gold, despite a recent pullback from an apparent normalisation of trade relations between the US and China. By way of example, State Street Global Advisors says 'there is a strong tactical and strategic case to be made that the gold market has transitioned to a higher price regime north of US$3000/oz.' They've loaded up a new baseline floor price of US$3000-3100/oz, with a base case of US$3100-3500/oz for 2025. Their H2 bull case has been upgraded, with new projections ranging between US$3500 and US$3900 per ounce. Looking ahead If approved by shareholders, the demerger is expected to be completed by early July 2025. Ballard has secured a high-calibre and experienced team with extensive experience in mineral exploration, project development, mining and financing in the resources industry. The team includes a combination of existing Delta directors and new appointments, including two independent non-executive directors with suitable technical expertise. The Ballard board and senior management comprises previous De Grey (ASX:DEG) chairman Simon Lill as independent non-executive chairman, Paul Brennan as managing director and CEO and former Ramelius Resources (ASX:RMS) CFO Tim Manners as finance director. Proposed chairman Simon Lill said Delta has done an excellent job in preparing Ballard for a spin out on behalf of its shareholders through IPO. 'I was pleasantly surprised with the substantial exploration upside at the Mt Ida gold project,' he said. 'With multiple walk-up targets over a largely untested 16km of trend, the opportunity to find another Baldock with its 930,000oz at 4.1g/t Au is real with the potential to grow into a camp-scale endowment.' This article was developed in collaboration with Delta Lithium, a Stockhead advertiser at the time of publishing. This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
