In accordance with the agreement, Ragusa will initially earn a 90% stake in prospective tenements, specifically EL28642, EL29731, EL30521, EL32671 and EL(A)32405.
May Drilling will receive A$125,000 in cash from Ragusa to fund due diligence works on the tenements.
Planned to be carried out over a period of up to 12 months, the due diligence work will include exploration activities targeting outcropping pegmatite rocks.
Ragusa will also hold the right to purchase the remaining 10% stake in the five tenements from May Drilling for A$500,000 in cash, $500,000 in cash or shares, and the grant of a 2% net smelter return royalty from the tenements.
Following the completion of the farm-in period, Ragusa and May Drilling will sign a joint venture agreement.
Ragusa chairperson Jerko Zuvela said: “The company has secured extremely strategic and highly sought-after lithium prospective tenements in the centre of a well-renowned lithium district.
“This is a significant opportunity to combine Ragusa’s existing NT lithium projects to create a combined ‘supergroup’ project area comparable to neighbours Core Lithium and Lithium Plus, and utilise our exploration and development experience to rapidly progress our NT Lithium Project in a Tier 1 jurisdiction close to major infrastructure.
“With four currently granted tenements and considerable historic works to reference, Ragusa is in a strong position to rapidly accelerate the development of our project at a time of record lithium prices and within a proven high-quality lithium district.”
Earlier exploration activities by May Drilling and other groups at the tenements focused on tin, tantalum, gold, copper, zinc, graphite, lead, uranium and lithium.
Ragusa plans to continue the previous work at the tenements that identified high-grade lithium and gold mineralisation following preliminary surface exploration works.