Junior explorer Marquee Resources (ASX: MQR) has signed a non-binding offtake agreement with a Chinese battery cathode developer to research and test product from its share of the Werner Lake sulphide cobalt project in Canada.
The agreement with Zhejiang Meidu Haichuang Lithium Battery Technology Co (or China Hitrans) will see Marquee provide metallurgical product samples for independent testing from Werner Lake within the next three months.
During this time, Marquee will also commence formal binding offtake agreement negotiations for the sale and purchase of Werner Lake product when the company begins commercial mining operations.
Marquee managing director Charles Thomas said the agreement was an important milestone for the company’s operations.
“The interest shown by numerous Chinese end users demonstrates the strong appetite for cobalt and in particular, the potential product that Werner Lake could deliver,” he said.
China Hitrans is a high-tech business which develops, produces and sells ternary cathode materials and ternary precursors of lithium battery.
The company has developed a series of high-quality products and has formed a multi-level product structure led by lithium battery ternary precursor (nickel-cobalt-manganese precursor, nickel-cobalt-aluminum precursor, nickel-cobalt precursor) and lithium battery ternary cathode material (lithium-nickel-cobalt-manganese oxide, lithium-nickel-cobalt-aluminum oxide).
The product range covers electric vehicles, power tools, high-end digital products and energy storage.
Werner Lake acquisition
Marquee acquired a share of the historic Werner Lake project in December and entered into an agreement with vendor Global Energy Metals Corporation to earn an initial 30% by spending $1 million on Stage 1 exploration activities over a 12-month period.
Completing a Stage 2 expenditure of $1.5m will allow Marquee to earn the remaining 40%.
In October, the Werner Lake Phase 2 drilling campaign confirmed “encouraging consistency of data” when compared to a 2000 metre maiden program earlier in the year.
Designed to test the down-dip potential of the orebody, Phase 2 successfully intersected further extensions to the cobalt sulphide mineralisation.
The campaign’s best results were 0.55m at 0.534% cobalt from 202.75m and 0.73m at 0.159% cobalt from 210.20m.
Other promising assays were 0.89m at 0.365% cobalt from 253.86m from 253.86m, and 1.26m at 0.299% from 279.23m.
Marquee said it was confident the assays would increase Werner Lake’s existing indicated mineral resource of 79,400 tonnes at 0.43% cobalt.
The mineralised zones remain open in all directions and the company said it intends to “aggressively explore” additional potential to expand the resource.
In its heyday, Werner Lake produced a total of 143,386 pounds of cobalt grading approximately 2.2% cobalt and 0.75% copper.
At midday, shares in Marquee Resources were up 36% to $0.105.