ATHA Energy Corp (CSE:SASK, OTCQB:SASKF) announced that it has entered into option agreement with Terra Uranium Ltd (ASX:T92) which allow the two companies to earn significant interest in each other’s uranium exploration projects.
ATHA has granted Terra Uranium an option to acquire up to 70% interest in its Spire and Horizon properties, together the Spire Horizon projects.
Terra Uranium must incur a minimum investment of $4.75 million in exploration expenditures by 2028,with staged investments over five years.
Upon fulfilling the first three expenditures, a 50/50 joint venture will be established.
Terra Uranium can increase its interest to 70% in the Spire Horizon projects by meeting the full expenditure commitments.
ATHA has the option to convert its carried interest into a participating interest upon completion of a preliminary economic assessment.
In exchange, Terra Uranium has granted ATHA the option to acquire up to a 60% interest in its Pasfield Lake property.
ATHA can exercise this right by funding up to $10 million in exploration or drilling four deep holes by 2028.
After completing each stage, ATHA can convert its interest into a net smelter royalty or form a joint venture with Terra Uranium.