Kenorland Minerals Ltd (TSX-V:KLD) told investors that it has entered into an option agreement with Double O Seven Resources Ltd. under which it has granted Double O the sole and exclusive option to acquire a 100% interest in the Separation Lithium Project, located within the English River domain in the Kenora Mining District of northwestern Ontario.
Upon signing, Vancouver-based Kenorland said Double O, a private British Columbia company, made an initial $100,000 payment and can earn up to a 100% interest in the Separation project by incurring aggregate payments of $1.5 million on or before the fifth anniversary of the option agreement.
Under the deal, Double O will make annual payments on or before the anniversaries of the agreement, including $150,000 on the first anniversary, $200,000 on the second anniversary, $250,000 at the third anniversary, $300,000 on the fourth anniversary, and $500,000 on the fifth anniversary.
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Upon completion of the option agreement, Kenorland said it will retain a net smelter returns royalty of 2.5%. For an initial two-year term, Kenorland will remain the operator of the project and receive a 10% management fee.
The Separation Lithum Project covers approximately 80 kilometres between the English River and Winnipeg River geologic subprovinces. This subprovince boundary is spatially associated with the Tanco Li-Cs-Ta (lithium-caesium-tantalum) pegmatite deposit in Manitoba, as well as the Big Whopper lithium pegmatite in the Separation Rapids area.
The presence of these two significant lithium pegmatite deposits suggests that the entire English River/Winnipeg River domain contact is prospective for additional lithium pegmatite mineralisation, Kenorland said.
Kenorland's focus is on early to advanced-stage exploration in North America. It currently holds four projects in Quebec, where work is being completed under joint venture and earn-in agreement from third parties.
In Alaska, the company owns 100% of the advanced stage Tanacross porphyry copper-gold-molybdenum project as well as a 70% interest in the Healy Project, held under a joint venture with Newmont Corporation.
Contact the author at stephen.gunnion@proactiveinvestors.com