MetalsGrove Mining’s (ASX:MGA) wholly owned subsidiary, MetalsGrove Global, has entered into strategic agreements with 2 local Zimbabwe entities to acquire 6 new lithium claims.
The company has signed the agreements with La Rich Resources and CN Mining Syndicate to secure the Arcturas and Beatrice lithium projects, respectively.
Both projects sit close to the ‘world-class’ Arcadia Minerals lithium-producing mine in Zimbabwe, which represents one of the world’s largest lithium mines, producing 450,000 tonnes per year of lithium concentrate.
Under the terms of the acquisition, MetalsGrove will pay a total cash consideration of US$60,000 to the local entities upon the transfer of the properties to its subsidiary. The aggregate upfront cash consideration comprises a US$50,000 payment for the acquisition of Arcturas and US$10,000 for the acquisition of Beatrice.
Each of the local entities is expected to retain a 5% free carried interest in the respective projects until a decision to mine is reached. However, once reached, each vendor will either sell their interest in the JV to the company or be obliged to make capital contributions equal to the participating interest.
Following completion, MetalsGrove will pay deferred considerations of US$6.15 million to La Rich Resources, with US$150,000 to be paid within 30 days of MetalsGrove completing a reverse circulation (RC) or diamond drillhole intercept on Arcturus of at least 15m @ 1.2% lithium.
The remaining $6 million is split between a $2 million payment and a $4 million payment, due within 90 days of the definition of an indicated Mineral Resource Estimate (MRE) of at least 20 million tonnes (Mt) and 40Mt, respectively.
As part of the acquisition, MetalsGrove will act as manager and have a 95% participating interest in each of the joint ventures (JVs).
MetalsGrove announces it will undertake a capital raising to fund exploration activities at the projects and existing tenements, which are scheduled to begin in Q1 2024.
The terms of the capital raise are yet to be confirmed.
MetalsGrove Managing Director Sean Sivasamy says the projects provide the company with exposure to the proven lithium-producing district in Zimbabwe.
“The board considers this a transformational opportunity for MGA supported by a strong lithium market, and we look forward to advancing these assets as quickly as possible over the coming months.”
“The board considers this a transformational opportunity for MGA supported by a strong lithium market, and we look forward to advancing these assets as quickly as possible over the coming months”
The Arcturas Project sits 35km northeast of Harare, while Beatrice sits 55km south. Recent rock chip sampling at Arcturas and Beatrice has returned grades up to 2.5% and 2.1% lithium oxide, respectively, from surface outcrops.
MetalsGrove is a critical metals explorer and developer focused on its portfolio of ‘high-quality’ lithium, rare earth, copper-gold, manganese, and base metals projects in Western Australia and the Northern Territory.
Write to Adam Drought at Mining.com.au
Images: MetalsGrove Mining and Pexels
