Lithium miner SQM has agreed to initially acquire a 30% stake in Pirra Lithium Limited (Pirra), which owns extensive lithium exploration acreage in Pilbara, Western Australia (WA).

SQM’s subsidiary SQM Australia will acquire half of Haoma Mining NL’s (Haoma) stake in Pirra.

With this deal, Haoma Mining will hold a 30% stake in Pirra while Calidus Resources will hold a 40% interest.

Furthermore, SQM will provide A$3m ($1.9m) in funding to increase its total stake in Pirra to 40% following which Haoma Mining will eventually own a 20% interest. The funding will be used for exploration work. 

After the completion of the share sale agreement, SQM will subscribe to A$3m of Pirra shares at an issue price of A$0.20 for each share.

Calidus said it will retain a 40% stake in Pirra Lithium by investing A$2m in exploration work.

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By GlobalData

Pirra Lithium has also agreed to acquire a further 348km² of lithium rights in the East Pilbara from Haoma.

The additional tenements are planned to be added to the existing lithium rights-sharing agreements signed between Pirra and Haoma in February 2022.

As part of this deal, Pirra will invest A$500,000 in exploration expenses over a period of 18 months.

Pirra will also issue 7.5 million performance rights to Haoma.

Calidus managing director Dave Reeves said: “With an increased landholding of over 1,411km² in the Pilbara, Pirra is now funded to rapidly progress exploration across these tenements. An initial focus will be the Tabba Tabba South tenements which lie immediately along strike from known lithium occurrences and on a belt that hosts significant lithium resources.

“Calidus will maintain its position in Pirra at 40% due to the significant potential of the land package and will re-assess its options for this holding as exploration continues. In line with this approach, there is no plan to seek an IPO of Pirra in the immediate term.”

Pirra’s main exploration assets are the Spear Hill and Northampton lithium tenements.

The company is currently mapping and sampling priority lithium targets, including Tabba Tabba South in West Pilbara.