Terra Uranium (ASX:T92) has entered into a non-binding letter of intent with ATHA Energy Corp (TSX-V:SASK) to negotiate a definitive option and joint venture agreement.
Under the agreement, ATHA Energy will grant Terra Uranium an option that will give the company the right to acquire up to 70% of the Spire and Horizon Uranium exploration projects.
Terra Uranium will fund C$4.75 million ($5.17 million) in statutory exploration expenditure, over a five-year period, to acquire the 70% interest in both projects.
Once the first, second, and third expenditures are completed, both companies will form a joint venture, with the initial interest of Terra Uranium being a 50% participating interest, and ATHA being a 50% carried interest.
Upon satisfying the fourth and fifth expenditure, the company’s 50% interest in the joint venture will increase to a 70% interest and ATHA’s interest will reduce to 30%.
Terra Uranium will also grant ATHA Energy a series of options that will give the company the right to acquire up to 60% of the Pasfield Lake Uranium Project in Canada.
ATHA Energy will obtain a 15% interest after either funding C$1 million in exploration expenditure or completing one deep hole of at least 1,000m into the geophysical target before 31 December 2025.
The company will continue either funding C$1 million in exploration expenditure or completing one deep hole of 1,000m into the target before the end of each year, up until 31 December 2028.
Once completed, a joint venture will be formed with Terra Uranium holding a 40% interest in the project, and ATHA Energy holding the remaining 60%.
Terra Uranium says the proposed drilling programs by ATHA Energy at Pasfield Lake, will likely be conducted concurrently with a separate exploration program by ATHA at its Ridge Project.
The drilling will test targets along a highly prospective structural corridor, which was first uncovered by ambient noise tomography surveys that extends from ATHA Energy’s Ridge Project through to Pasfield Lake.
Executive Chairman Andrew Vigar says the company is pleased to be working with ATHA Energy on exploring its prospective Spire and Horizon Projects, while also helping to advance the Pasfield Lake Project.
“In addition, T92 will continue to advance its HawkRock and Parker Lake projects in the Athabasca Basin and the Amera Lake Project in Nunavut,” Vigar says.
Terra Uranium says entering into the definitive agreement will increase its exposure to the Athabasca Basin, while allowing ATHA Energy to further consolidate the Cable Bay Shear Zone, de-risking the Ridge and Pasfield Lake projects, while also decreasing overall exploration costs and providing upside exposure.
The Pasfield Lake Project has multiple conductive zones and seven priority target areas that require a minimum of two drillholes per target.
Terra Uranium is focused on advancing a strategic portfolio of high-quality uranium exploration assets in Canada, within Saskatchewan’s Athabasca Basin and Nunavut’s Telon Basin.
The Spire and Horizon projects comprise 12 mineral claims, totalling 60,965 hectares, and lie on the eastern rim of the Athabasca Basin, Saskatchewan.
ATHA Energy Corp is a Canadian mineral company focused on acquiring, exploring, and developing uranium assets in the pursuit of a clean energy future.
Write to Aaliyah Rogan at Mining.com.au
Images: Terra Uranium
