Monger Gold (ASX:MMG) is set to purchase the Scotty Lithium Project in Nevada, USA, after signing a binding acquisition agreement to acquire 100% of shares in American Consolidated Lithium Pty Ltd.
The deal will see Monger pick up the large-scale sediment-hosted lithium project comprising 700 unpatented placer mining claims across a 14,000 acre footprint in Southern Nevada, pursuant to an option to purchase agreement with current holder Playa Minerals Company.
The Scotty claims are located immediately adjacent to and surrounding Nevada Lithium’s (CSE: NVLH) world-class Bonnie Claire Project, which is home to one of the largest known lithium resources in North America @ 18.37Mt lithium carbonate equivalent.
Addressing the news, Monger Gold Chairman Peretz Schapiro said: “Since listing on the ASX in July last year we have strived to maintain a very tight capital structure with only 28m shares currently on issue, whilst evaluating new opportunities to maximise returns for our shareholders.
We are delighted to secure the Scotty Lithium Project for our shareholders at a very modest upfront cost with the majority of the consideration contingent upon the delineation of a significant JORC (2012) Resource of up to 500Mt at a grade of at least 1,000ppm Li. This would be a very large Resource – which illustrates the considerable upside of this acquisition.
“We are delighted to secure the Scotty Lithium Project for our shareholders at a very modest upfront cost”
The Scotty Lithium Project is located in Nevada immediately adjacent to one of North America’s largest lithium resources. The Scotty Lithium Project is also located only 70km from the only lithium producing mine in the US, and just 300km from Tesla’s Gigafactory.
The electric revolution is just getting started, with increased demand for lithium to be a feature of the world’s economy for many years to come. Through development of the Scotty Lithium Project as well as continuing to seek out additional accretive acquisitions, MMG intends to become a significant player in the lithium market.
ACL’s team possesses deep in-country experience and connections. With their assistance, we will begin work at the Project in earnest, with an extensive soils campaign to begin in May, followed by a drilling campaign in Q3 of this year.
We look forward to keeping the market informed of our progress.”
The company notes that historical soil sampling at the project has achieved grades of up to 300ppm Li, which are analogous to grades at Albermarle’s (NYSE: ALB) nearby Clayton Valley Mine.
Location of the Scotty Lithium Project, with surrounding major projectsCommitments have been received to raise AUD$1.76 million to fund initial work programs at Scotty, with the company set to hold approximately AUD$4.75 million in cash reserves upon closing of the acquisition agreement.
Moving forward, Monger reports that it will embark on an exploration program immediately following the acquisition, including project-wide soil sampling beginning in June 2022, followed by maiden drilling in Q3.
Images: Monger Gold Ltd
