High Tide Resources has signed an option agreement with undisclosed firms (vendors) to acquire a 100% stake in the Clearcut Lithium Project in Quebec, Canada.

Under the agreement, High Tide will have the option to pick a 100% interest in the property by making $100,000 in aggregate cash payments and issuing 1,000,000 of its common shares to the vendors.

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High Tide will also incur $1m in exploration expenditures on or before the agreement’s third-anniversary date. 

Furthermore, the vendors will retain a 2% net smelter royalty, of which 0.5% may be bought by High Tide for $1m. 

High Tide will also make additional milestone payments of $500,000 upon filing a positive feasibility study and $1m once the project starts commercial production. 

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The firm said in a statement: “The milestone payments may be paid in cash or the issuance of shares at the Company’s discretion and shall be deemed to be an advance to the Vendors to be deducted against future royalty payments.”

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The project, which is located in the emerging Cadillac-Pontiac lithium camp in the Abitibi Témiscamingue region south-west of Val d’Or, comprises 249 claims covering around 14,40ha.

High Tide director, president and interim CEO Steve Roebuck said: “Adding the Clearcut Lithium Project to High Tide’s project portfolio is a low-risk and potentially high-reward opportunity for all our shareholders. 

“Lithium is in high demand making Clearcut a natural fit alongside our Lac Pegma Copper-Nickel-Cobalt Project that further diversifies our battery metals projects along with our flagship Labrador West Iron Project.”

Currently, High Tide owns a 100% interest in the Labrador West Iron Project located in Labrador City, Newfoundland and Labrador, as well as a 100% stake in the Lac Pegma copper-nickel-cobalt deposit located 50km south-east of Fermont, Quebec.