Monger Gold to acquire highly-prospective US lithium project
Monger Gold’s acquisition target Scotty is 70km Albemarle’s Clayton Valley lithium project, which has the only producing lithium mine in the US.
Junior explorer Monger Gold (ASX: MMG) has confirmed it will outlay $2 million to buy all of the shares and options in American Consolidated Lithium, which holds the rights to acquire the highly-prospective Scotty lithium project in southern Nevada.
The acquisition of 700 unpatented placer mining claims (collectively known as Scotty) over 56 square kilometres of the western US state is pursuant to an option to purchase agreement with US-based Playa Minerals Company.
The takeover of American Consolidated will provide Monger with direct exposure to a large-scale lithium exploration project in a tier one district, and access to a team experienced in the North American minerals sector.
The Scotty project is located 70km from Albemarle Corporation’s Clayton Valley (Silver Peak) development, which is the only producing lithium mine in the US.
It is approximately 330km from Tesla’s giant lithium-ion battery and electric vehicle manufacturing facility.
The project adjoins the Bonnie Claire lithium operation owned by Iconic Minerals, which hosts an inferred resource of 3.4 billion tonnes at 1,013 parts per million lithium for 18.3 million tonnes of lithium carbonate equivalent.
High-tenor, coherent, undrilled soil anomalies defined in limited previous work have confirmed Scotty has potential to host a sizeable lithium resource.
Previous exploration
Several companies have completed limited previous exploration within small portions of the Scotty project.
For the four years to 2019, Utah Mineral Resources, Rainmaker Resources and Hybrid Ventures held up to 234 placer mining claims immediately to the west of the Bonnie Claire project area; however, limited soil sampling was the only notable work completed.
In 2016, Caeneus Minerals (ASX: CAD) owned 200 mining claims covering approximately 16sq km at the southern end of the area covered by the current Scotty project.
Caeneus collected a single line of magnetotelluric (MT) data and unsuccessfully attempted the drilling of two holes.
Both holes were abandoned due to ground conditions and no samples were obtained.
Multiple strong resistivity lows were delineated in the MT survey and were interpreted to potentially arise from brines within the geological sequence.
The shallowest of these anomalies lies between 500 metres and 800m below surface.
Share placement
Monger Gold plans to fund the American Consolidated deal using proceeds from a recent $1.76 million share placement.
The company has received firm commitments for the issue of approximately 7.04 million shares at $0.25 each to sophisticated and professional investors.
The non-brokered placement will be carried out at a discount of 10.7% to the company’s last traded share price of $0.28.
Funds raised will be used to pay costs associated with the acquisition of American Consolidated Lithium and for exploration at Scotty.