Metal Energy Corp (TSX-V:MERG, OTCQB:MEEEF) has announced its acquisition of the SourceRock lithium brine project in northwestern Ontario's Thunder Bay-Nipigon area.
The project spans an expansive 913 square kilometers and holds significant potential for lithium extraction.
In a statement, James Sykes, CEO of Metal Energy, expressed his enthusiasm for the project, commenting: "The SourceRock Li brine project covers a dominant land position of untested regional lithium brine targets within the Proterozoic Sibley sedimentary basin that is on a regional scale equivalent in size to Chile's Salar de Atacama central salt body, the largest Li brine producing jurisdiction in the world."
Sykes highlighted the project's extensive coverage and its strategic location in the deepest parts of the basin, with sedimentary thickness ranging from 500 meters to 1,000 meters, enhancing the potential for lithium brine discovery. Reports from previous exploration in the area have shown evidence of supersaturated saline solutions within the basin sediments and even in the underlying Li-pegmatite-rich basement rocks.
The company already possesses drill permits and is eager to advance the SourceRock project with its first drill program. Metal Energy is engaging with local Indigenous groups, communities, and stakeholders, ensuring thorough consultation before commencing drilling operations.
Metal Energy entered into an option agreement to acquire a 100% interest in SourceRock, making a $50,000 cash payment and committing to a staking program worth over $100,000. The agreement entails issuing 3,000,000 common shares of Metal Energy, 1,500,000 warrants, and $500,000 worth of common shares on or before the first anniversary of the effective acquisition date.
The company will operate the project and conduct all necessary work programs. The vendor retains a 3% net smelter returns royalty, with Metal Energy having the option to purchase 1% of that for $500,000 within four years and the remaining 2% for $5,000,000 within 10 years.
SourceRock covers an area of 91,288 hectares in the Proterozoic Sibley sedimentary basin, benefiting from excellent infrastructure access, including highways, railroads, seaports, and power and natural gas lines.
Metal Energy's exploration portfolio also includes the Manibridge project in Manitoba and the Strange project in Ontario, both situated in politically stable Canadian jurisdictions. The company holds an 85% ownership of the Manibridge project and has earn-in agreements for full exploration rights on both SourceRock and Strange projects.
Contact the author at jon.hopkins@proactiveinvestors.com