Australian Strategic Materials boosts standing at Mount Squires

Australian Strategic Materials (ASX:ASM) has signed a joint venture (JV) agreement with Caspin Resources (ASX:CPN) to earn a 75% stake in the Mount Squires Project in Western Australia.

Wholly owned by Caspin, the project sits 1,700km northeast of Perth in WA’s Musgrave region, adjacent to the western border of BHP’s (ASX:BHP) West Musgraves Project where the famed Nebo-Babel discovery was made.

The JV agreement begins with a three-month option period, under which Australian Strategic Materials will undertake and pay for metallurgical testwork on samples from the Mount Squires Project. 

Over a six-month period thereafter, Caspin will carry out a drilling program — paid for by Australian Strategic Materials at a minimum cost of $250,000 — to produce additional samples for testwork.

Both companies will then work to finalise a joint venture agreement over another two months.

From there, Australian Strategic Materials may exercise its option to earn a 75% interest in the Mount Squires Project over two stages.

The first stage spans 24 months, during which Australian Strategic Materials will spend $1.5 million on exploration activities and issue $500,000 worth of shares to Caspin in exchange for a 51% stake in the rare earths (REE) rights at the project.

A second three-year stage will see another $2 million spent on exploration and $1 million worth of shares issued to Caspin for an additional 24% interest in the REE rights.

Caspin’s remaining 25% stake will then be free carried to a decision to mine.

“We are pleased to collaborate with Caspin to identify further raw material supply for ASM’s Dubbo Project separation and refining facility,” Australian Strategic Materials Managing Director and CEO Rowena Smith says.

“This opportunity aligns with our mine to metals strategy to broaden its rare earth supply, particularly for high value heavy rare earths.”

Located 25km south of Dubbo in central New South Wales, the Dubbo Project is intended to produce metal oxides in the form of chemicals, powders and metals.

Meanwhile, Caspin Managing Director Greg Miles noted that the joint venture will allow Caspin to retain exposure to the Mount Squires Project’s REE potential without any funding obligations.

“This will allow Caspin to maintain its focus on the nickel, copper and gold potential at Mount Squires and other acquisition opportunities,” Miles says.

“We believe that the high proportion of high value, heavy rare earths, close to surface in an area with no previous exploration for rare earths, sets the Mount Squires REE Project apart from its peers.”

Significant REE mineralisation was discovered at Mount Squires by Caspin in 2023, which Australian Strategic Materials says was “the first discovery of REE in the West Musgrave province.”

Write to Adam Drought at Mining.com.au

Images: Australian Strategic Materials
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Written By Adam Drought
Born and raised in the UK, Adam is a sports fanatic with an interest in Rugby League and UFC/MMA. When not training in Muay Thai and Brazilian Jiu Jitsu, Adam attends Griffith University where he is completing his final year of a Communication & Journalism degree.