SINGAPORE - Lithium miner Alita Resources said on Wednesday night (Aug 21) that the standstill period with a consortium of lenders led by Tribeca Investment Partners has been extended by a few days to Aug 23 at 7pm.

The company and the lenders had previously entered a standstill agreement until Aug 20 regarding asserted events of default relating to a A$40 million (S$37.5 million) loan facility.

The extension will allow more time for negotiations with lenders and other parties on the loan facility refinancing options and recapitalisation proposals.

The asserted events of default relate to non-acceptance by lenders of an updated life of mine plan; and an alleged failure to comply with physical parameters of the preciously approved life of mine plan. A life of mine plan is a formally approved long-term plan for a mine.

Another asserted event of default is Alita Resources "suffering a material adverse effect" to its business and financial performance as a result of lithium spot price deterioration and weakened market demand for spodumene concentrate.

Alita Resources announced on Aug 18 that its mining contractor on Aug 16 commenced scaling back operations at the mine, pending outcome of those negotiations. Although delivering an immediate reduction in mining costs, the change also resulted in an event of default relating to mining parameters being triggered under the loan facility.

This event of default is covered by the standstill agreement, the company said.

On Aug 20, Alita Resources said it had completed a shipment to buyer Jiangxi Bao Jiang Lithium Industrial Limited for around 10,500 dry metric tonnes (dmt) of lithium concentrate at a price below the previously announced floor of US$680 per dmt. This was in order to continue monetising its product stockpile amid challenging market conditions for spodumene, said the firm.

Alita Resources shares have been suspended since Aug 14. Prior to the suspension, the counter last traded at 8.2 cents on Aug 12.