Canadian mineral exploration company Azimut Exploration has signed two joint venture (JV) option agreements with Rio Tinto’s subsidiary Rio Tinto Exploration Canada for its two lithium properties in Canada.
The Corvet and Kaanaayaa lithium properties are located in Quebec’s Eeyou Istchee James Bay region.
As part of the agreements, Rio Tinto can initially acquire a 50% stake in each of the properties over a period of four years in exchange for funding C$7m ($5.26m) for exploration work and paying C$850,000 for each of the properties.
An additional 20% stake in each of the properties can be earned by Rio Tinto over a period of five years by incurring further work expenditures of C$50m per property.
Azimut will serve as the operator of the properties during the first option phase while Rio Tinto will be the operator during the second phase.
Furthermore, Azimut will have the right to be funded to production by securing a loan from Rio Tinto. The former will grant an additional 5% interest in the properties to Rio Tinto, whose total interest in the properties will total 75%.
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The first-year exploration programme aims to assess and test the lithium potential of the Corvet and Kaanaayaa properties.
In a press statement, Azimut said: “The properties display significant lithium exploration potential supported by regional geoscientific data and their strategic locations relative to a major emerging lithium district.”
The Corvet Property comprises 877 claims covering an area of 423km². It straddles a major tectonic boundary.
Covering an area of 216km², the Kaanaayaa Property consists of 421 claims. It hosts several granitic intrusions surrounded by paragneiss and metavolcanics, including ultramafic rocks.
The agreements are subject to regulatory approvals by the TSX Venture Exchange.