Viridis Mining and Minerals (ASX:VMM) has secured a potentially ‘world-class’ ionic adsorption clay (IAC) rare earth element (REE) project in Minas Gerais, Brazil.
The company says it has entered into a binding agreement to acquire a 100% interest in the rights to the REEs comprising the Colossus Rare Earth Project, which lies in Minas Gerais’ Poços De Caldas Alkaline Complex.
Following the announcement, the company’s share price closed 92% higher at $0.48 on Tuesday afternoon.
To date, exploration undertaken at the project consists of 34 shallow auger holes completed by the previous owners to a maximum depth of 3m. Results from previous drilling are reported to have returned ‘remarkable’ grades of REE mineralisation within heavily weathered clay and humic profiles.
These results include hole TN-AG-222 with 3m @ 2,003 parts per million (ppm) total rare earth oxide (TREO) from surface (22% MREO), ending in mineralisation, and hole TN-AG-223 with 3m @ 1,997ppm TREO from surface (22% MREO), ending in mineralisation.
Mineralisation is interpreted to remain open in all directions and at depth, with no drilling to date having been completed below 3m. Viridis says these results represent the underpinning of a tier one project, with grades expected to increase ‘significantly’ when tested with deeper drilling.
The terms of the deal include an upfront payment of US$2 million structured as an advanced royalty payment on a royalty from future production. This payment comprises a non-refundable cash payment of US$1 million upon the settlement of the acquisition and an additional US$1 million payment within 4 business days of the 6-month anniversary of the settlement date payment.
Meanwhile, the company states it will raise about $2.2 million at $0.25 to fund exploration and the initial upfront cash payment for the project. Ionic Rare Earths (ASX:IXR) is expected to represent the cornerstone for $600,000 and will provide the company additional expertise to fast-track the project into development.
With the company well on its way to securing a 100% interest in the Colossus project, Viridis announces it is continuing to explore opportunities to acquire additional exploration and mining licences prospective for IAC Rare Earths in the Poços De Caldas Alkaline Complex.
This work is intended to feed into part of the company’s long-term vision to scale the Colossus Project to a world-class asset.
Addressing the acquisition, Viridis Mining and Minerals Executive Chairman Agha Shahzad Pervez says: “The acquisition of the Colossus Project marks a transformative step for Viridis’ growth strategy and provides the company a dominant land position directly adjacent to the world’s highest-grade ionic adsorption clay REE deposit.
“The acquisition of the Colossus Project marks a transformative step for Viridis’ growth strategy”
The widespread high-grade REE mineralisation within the Colossus Project in the upper ‘leached zone’ demonstrated by shallow drilling is particularly encouraging and provides the company with an exciting opportunity to define and grow a strategic resource within South America’s largest known Alkaline complex.
Viridis will now commence an aggressive and systematic exploration program to delineate a maiden resource to establish a supply chain of high-grade rare earth oxide for Western markets.”
Viridis Mining and Minerals is an ASX-listed resource explorer and developer with assets in Canada and Australia. These projects include the South Kitikmeot, Boddington West, Bindoon, and the Poochera and Smoky projects.
The company reports the Colossus project comprises 41 licences, including 2 mining leases, which cover a total land area of 56km-square within South America’s largest alkaline complex.
Write to Adam Drought at Mining.com.au
Images: Viridis Mining and Minerals Ltd