Kalamazoo Resources (ASX: KZR) has teamed up with major Chilean miner SQM to progress exploration at the former’s 100%-owned DOM’s Hill and Marble Bar lithium projects in the East Pilbara.
The deal will see SQM earn in up to 70% of all mineral rights across the projects via the funding of $12 million in exploration and development over four years. This is broken down into three phases via which SQM can acquire 30%, 50% and finally 70%.
SQM is a major global producer of lithium carbonate and lithium hydroxide products, holding approximately 19% of global market share in 2020. It currently owns a 50% interest in the tier-1 Mt. Holland Lithium Project with JV partner Wesfarmers (ASX:WES).
Speaking on the deal, Kalamazoo Resources Chairman and CEO Luke Reinehr said “We are delighted to have established this significant exploration partnership with SQM. Although early stage, the DOM’s Hill Lithium Project, hosts one of the closest geologic analogues to the nearby world-class Pilgangoora and Wodgina lithium mines.
“It is a terrific validation that SQM, one of the world’s major lithium producers, shares our confidence in the potential to discover another large-scale lithium deposit in the Pilbara”
It is a terrific validation that SQM, one of the world’s major lithium producers, shares our confidence in the potential to discover another large-scale lithium deposit in the Pilbara. This JV now provides us with the opportunity to tap into SQM’s undoubted lithium expertise and participate in a very focused exploration and potentially development program. This is an important initiative for Kalamazoo and adds to our major assets at the 1.65Moz Ashburton Gold Project and our portfolio of gold projects in Victoria.”
SQM Senior Vice-President Pablo Altimiras added “We are delighted to start this new endeavour with Kalamazoo, and we are confident that we can leverage the strengths of both partners to find and potentially develop a new lithium project in the Pilbara.”
‘Significant’ lithium potential has been identified at DOM’s Hill, with recent studies, high-resolution satellite imagery, field reconnaissance and geochemical soil sampling identifying a series of pegmatite-hosted Lithium-Caesium-Tantalum targets.
The 122km² project encompasses ‘highly prospective’ Archaean granite-greenstone terrane, in close proximity to major lithium operations including Pilgangoora (223Mt), and Wodgina (259Mt).
Kalamazoo will act act as the initial exploration manager of the JV, and has already completed project-wide geochemical soil sampling at both DOM’s Hill and Marble Bar during September to December 2021. This work has generated a series of high-priority drill targets for a minimum ~5,000m RC drilling program scheduled to kick off in 2022.
Kalamazoo Resources Limited