Heavy Rare Earths (ASX:HRE) has expanded on its mineral rights agreement over the Prospect Hill Tin Project in South Australia from Havilah Resources (ASX:HAV) for all minerals to diversify the company’s grasp in the energy and critical minerals sector.
The previous agreement offered Heavy Rare Earths into the project’s uranium mineral rights.
The company is required to spend a minimum of $1.5 million on exploration and development related activities in the first three years of the agreement, focusing on non-uranium minerals – including $350,000 in the first year.
Exploration activities will include a minimum of 2,500m of drilling in the first 18 months, and a minimum of 1,250m of drilling in the following 18 months.
Upon completion, Heavy Rare Earths will attain an 80% stake in the project, which will signify a joint venture agreement between the two parties.
Havilah will be free-carried through activities at the project until Heavy Rare Earths completes a bankable Feasibility Study on a chosen non-uranium deposit discovered in exploration.
The vendor will be eligible to contribute its 20% pro-rata share of following expenditure at the project or dilute to less than a 10% stake for a 1.5% net smelter return royalty on goods produced.
Non-executive chairman Gabriel Chiappini says the acquisition provides “significant” investor value for both companies.
“The Prospect Hill Tin Project is the largest and most advanced tin project in South Australia and represents a significant and rare opportunity for the company to become a key player in a high-value commodity,” Chiappini says.
“It offers a number of priority targets, as well as one prospect, South Ridge, where the company anticipates being able to compile a maiden mineral resource estimate quickly given the advanced nature of exploration here, including assays from 56 drillholes, with material mineralised intersections.”
Heavy Rare Earths intends to produce a JORC-compliant resource for the South Ridge prospect following a due diligence study.
Previous exploration at the project revealed over 500m of tin mineralisation along strike and to a depth of 120m at South Ridge.
Tin intercepts include 3m @ 4.85% tine from 44m; 5m @ 3.32% tin from 84m; and 6m @ 2.33% tin from 14m.
Located in the northern Flinders Ranges of South Australia, Prospect Hill comprises three exploration tenements for an area of 75km2. The project has an extensive geological database covering rock, soil, and stream samples, trenching, drilling, mapping, and metallurgical testwork.
Heavy Rare Earths is an emerging supplier of critical materials, focused on strengthening the supply chain for clean energy production.
Write to Maddison Elliott at Mining.com.au
Images: Havilah Resources
