Pan Asia Metals (ASX:PAM) has entered into an exclusive option agreement with the owner of a property on which the RK Lithium Prospect sits in Thailand.
Managing Director Paul Lock says it is an important step for talks with potential strategic partners and for the lodgement of a mining licence application.
The RK Prospect sits on the southern end of the RK Lithium Project, covering 42 hectares.
Under the agreement, the company has paid $143,000 to the property owner, and will pay another $265,500 in two separate installments by the end of this year.
The land area under the agreement falls within mining zones, which gives Pan Asia the legal right to submit mining lease applications and to conduct all activities relevant to establishing a mining business on its tenements which make up the RK Project.
Pan Asia has also entered into negotiations regarding the sale or lease of the RK property, with expectations for an outcome before the end of 2024.
Following completion of a recent capital raising, Pan Asia has also laid out its 12-month business strategy and planned activities across its RK and Tama Atacama lithium projects.
At the RK Project, the company is undertaking a Feasibility Study. At present, there are no mandatory exploration or feasibility expenditure requirements for the project.
Pan Asia is also awaiting assays prior to preparing for a maiden resource estimate of the BT prospect.
Meanwhile, Pan Asia’s KT prospect is the subject of initial fieldwork, where the company recently discovered a large mineralised lepidolite pegmatite dyke swarm.
Further to this, the company is in advanced discussions with an Asia-based lithium chemicals processor for a potential strategic partnership to develop the RK Lithium Project.
Pan Asia says successful negotiations could see a three-way agreement between the potential partner, Pan Asia, and Thai chemical company IRPC. An initial meeting has been held and discussions are ongoing.
If an agreement is formed, the two partners will be contributing partners and their expertise and knowledge will be used to complete required Feasibility Studies.
Pan Asia expects to reveal the outcome of these ongoing discussions in the September quarter, however, there are no guarantees that the discussions will result in an agreement between all of the parties.
Meanwhile, at the Tama Atacama Project in South America, part of the funds raised from the recent placement will be used to fund geophysics and initial exploration drilling.
The company says there are no mandatory exploration expenditure requirements for the project, and steps have been taken to initiate a geophysics program in the northern part of the project.
Results from this program will govern the location of drillholes in an initial drilling campaign, which will start with reconnaissance drilling.
Pan Asia plans to engage with a geophysics contractor in the first half of July. A drilling contractor will be engaged following completion of the geophysics program.
Geophysics will cost $120,000 and drilling is expected to cost no more than $250 to $300 per metre all in.
Subject to geophysics results, initial drilling will comprise about 700 to 1,000m. Total costs are estimated to be $120,000 for geophysics and between $190,000 and $315,000 for drilling.
Pan Asia notes it also raised $1.384 million after Novus Capital Partners’ capital raising fee through a recent placement.
On completion, Pan Asia says it will have sufficient capital to fund its business strategy.
Pan Asia Metals is a lithium-focused company with assets in Southeast Asia and South America. The company also has agreements with key battery and chemical producers in the Asian region to produce advanced battery chemicals.
Write to Aaliyah Rogan at Mining.com.au
Images: Pan Asia Metals
