A binding term sheet has been signed between the two firms to explore and develop lithium deposits across WSP, which comprises E 15/1743 and E 15/1781 deposits.
The deal will provide right to MinRes to acquire an initial stake of 25% in lithium rights at the project by funding all exploration and development work.
Besides, MinRes is required to complete a feasibility study within 24 months, and project due diligence within four weeks.
By the end of this year, the company is also anticipated to fund at least A$1,000,000 for the exploration and development activities.
It will spend A$500,000 to exercise the Fyfehill Option, which was established in 2020 when the project was purchased by Marquee from Fyfehill.
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As part of the farm-in processing, MinRes will have the option to earn an additional stake of 45% in the lithium rights by funding West Spargoville project until final investment decision is made on mine development.
If exercised, MinRes’ stake in the project will increase to 70%.
However, in the event of MinRes opting to go down the mining farm-in route, it will have option to earn a further 26% interest in West Spargoville’s lithium rights by funding the project until the construction and commissioning of a mine and associated facilities.
This would take the firm’s total interest to 51%.
Subsequently, MQR and MinRes would sign ‘mine gate sale agreement’ whereby the later will be required to build, own and operate all plant equipment and infrastructure related to the project’s mining operations.
Marquee executive chairman Charles Thomas said: “After much deliberation on which Partner to select to help us advance the West Spargoville Lithium Project, I am extremely happy to announce we are partnering with one of the most innovative and leading mining service companies and one of the world’s largest lithium producers.
“Mineral Resources has an excellent track record and reputation and I am very pleased that a company of their calibre sees the same potential at WSP as the team at MQR and I do.
“With the RC rig currently turning at the Project, we look forward to rapidly generating drilling results from the highly prospective WSP Project and sharing them with our shareholders.”
The West Spargoville Project is situated in the core of the Southern Yilgarn Lithium Belt, which comprises spodumene deposits including the Mt Marion mine, Bald Hill mine, Buldania project and Essential Metals Pioneer Dome project.