Core Lithium Ltd (ASX:CXO) has picked up six new mining leases next door to its advanced Finniss Lithium Project in the Northern Territory.
The new tenure covers more than 30 historical pegmatite mines, with evidence of lithium fertility and spodumene mineralisation already confirmed.
Today’s move executes an option agreement that was inked in March this year, upping Core’s exposure to tin and tantalum-producing tenements.
To complete the transaction, Core will hand over a combined $5 million in cash and shares, while a contingent consideration will come into play with every millionth tonne of JORC resource discovered at the Bynoe Pegmatite Field.
Cements “dominant landholding”
Speaking to the mining lease acquisition, Core managing director Stephen Biggins said: “This acquisition represents another enormous opportunity to add significant value for the Finniss Lithium Project through the acceleration of our resource expansion objectives.
“Bringing these mining leases into our portfolio supports our previously stated objective of further increasing the resource and mine life of the Finniss Project and cements our dominant landholding in this lithium-rich and low-risk mining jurisdiction of the Northern Territory.”
Shares have been as much as 7.6% higher in the first hour of trading to A$0.57 while CXO's market cap before opening was approximately A$884.5 million.
First-pass exploration
During the 2021 field season, a first-pass drilling expedition covered five of Core’s six new mining leases.
Twenty-nine drill holes, covering 4,530 metres, set out to test 10 separate targets at the tenements.
Since then, results for 18 holes have come back — some of which have intersected thick, downhole pegmatite readings up to 65 metres.
Notably, significant lithium intersections were found in all drill holes at the Centurion prospect.
This lithium-rich target is open along strike in both directions and at depth.
Assays received to date include:
- 9 metres at 0.67% lithium oxide;
- 22 metres at 0.74%;
- 5 metres at 0.96% and 2 metres at 2.26%;
- 2 metres at 0.92%; and
- 2 metres at 0.61%.
At the Bilatos prospect, a series of holes drilled along the strike of the body has identified a continuous pegmatite zone that is more than 350 metres long, dipping steeply to the east and with downhole thicknesses of up to 25 metres.
Further indications from outside the mining lease on Core’s exploration licences are that the Bilatos pegmatite could extend to more than 800 metres in length.
However, assays for this drilling expedition are still pending.
In the meantime, pegmatites over several hundred metres long were also intersected during drilling at the Northern Reward, Annies (NYSE:BNNY) and Saffums targets.
In addition, Core uncovered promising tin, tantalum and niobium grades — often considered harbingers for lithium mineralisation.
Assays above 100 parts per million (ppm) include:
- 6 metres from 61 metres at 192ppm tin oxide and 157ppm niobium pentoxide at Northern Reward;
- 21 metres from 89 metres at 241ppm tantalum pentoxide and 299ppm niobium pentoxide at Northern Reward;
- 5 metres from 95 metres at 166ppm tin oxide and 182ppm niobium pentoxide at Trojan;
- 3 metres from 86 metres at 178ppm tin oxide and 397ppm tantalum pentoxide; and
- 5 metres from 92 metres at 119ppm tin oxide, 393ppm tantalum pentoxide and 114ppm niobium pentoxide at Angers.
Consideration
In exchange for the mining leases, Core will hand over:
- $5 million to the project vendors, comprising a $1.5 million cash payment and 43.5 million worth of CXO shares (contingent on shareholder approval; and
- $500,000 — $150,000 in cash and $350,000 in shares — for every 1 million tonnes of JORC resource discovered at the Bynoe Pegmatite Field, capped at a $5 million aggregate.