Electric Royalties Ltd (TSX-V:ELEC, OTC:ELECF) has announced the completion of a key transaction involving the acquisition of a substantial lithium royalty and option portfolio across Ontario, Canada.
This strategic acquisition comprises 18 royalty agreements and 32 lithium properties, known collectively as the Ontario Lithium Projects (OLP).
Under the terms of the Asset Purchase Agreement with the counterparties, Electric Royalties has issued 2,250,000 common shares and finalized a net cash payment of C$1,689,000.
The transaction greatly expands the company's royalty portfolio, doubling its size and enhancing its position in a region recognized for its promising lithium reserves.
Brendan Yurik, chief executive of Electric Royalties, said: "Northwestern Ontario is known for its lithium potential; thus we are very pleased to complete the acquisition of these prospective lithium royalties and optioned properties in that region.
“We have strategically selected these royalties and projects from an initial 126 projects, based on our assessment of their prospective geology and greater proximity to prospects with reported lithium resources and exploration activity.
"Current lithium market conditions have allowed us to acquire this portfolio at a relatively low cost, while doubling the size of our overall royalty portfolio.
“The acquisition represents a significant opportunity for Electric Royalties to grow in an accretive manner, as forecasts suggest lithium prices will rebound in the longer term."
The properties involved are currently being explored by third parties under option agreements, with potential payments to Electric Royalties totaling up to $2.2 million over the next two and a half years, should these options be exercised.