Nova Minerals releases maiden lithium resource for Thompson Brothers, prepares TSXV spin-off

Nova Minerals (ASX: NVA) has released a maiden resource for its Thompson Brothers lithium project in Canada’s central Manitoba region, which the company claims “surpasses” its expectations, while making preparations to spin-off its lithium assets into a TSXV initial public offering.

The new resource totals 6.3 million tonnes grading 1.38% lithium for 86,940t of the contained metal.

According to Nova, the resource is based on one pegmatite that was drilled and comprises less than 5% of the project area.

The maiden JORC resource verifies and builds on a historic resource which sat at 4.3Mt grading 1.3% lithium.

Additionally, mineralisation remains open at depth and along strike to the north and south.

“This high-grade maiden resource has surpassed our initial expectations on grade and tonnes with a relatively small amount of cash spent to-date,” Nova managing director Avi Kimelman said.

“The resource represents an important milestone and indicates the potential scale of the project with the resource on well under 5% of the project area,” Mr Kimelman noted.

He added that with further exploration the company was optimistic the maiden resource is “just the beginning”.

In the immediate area of the maiden resource, Nova has developed an exploration target of up to 7Mt grading 1.5% lithium.

Preliminary metallurgical test work on a 1.4% lithium sample from Thompson Brothers has generated a 6.37% lithium concentrate.

Nova says this indicates the potential to develop a commercial product from the project.

The company plans to follow this up with “fast-tracked” metallurgical and feasibility studies. Additionally, the resource will be updated with further “walk-up” drilling.

Exploration will also be undertaken to extend the current resource and identify other deposits within the project.

TSXV listing in the pipeline

Nova is earning up to 80% in Thompson Brothers and 100% of the Crowduck lithium project via its subsidiary Snow Lake Resources.

The company plans to unlock the value of these lithium assets by spinning-off Snow Lake and listing it on the TSXV via a C$24 million initial public offering.

Nova anticipates once Snow Lake has listed, its interest in the entity will be pared back to 77%.

According to Nova, it has experienced numerous enquiries from North American investors that are unable to secure exposure to Thompson Brothers via the ASX.

Nova anticipates the “strong market interest” will propel Thompson Brothers through to completion of a prefeasibility study and subsequent development.

“Given the recent activity in the lithium market with higher prices and strong demand from the electric vehicle and battery storage markets, we think that Nova and its shareholders would benefit from a spin-off of its lithium asset with our Canadian peers’ valuations sitting at many multiples higher to what is prescribed to Nova on the ASX while maintaining a majority interest in the company and project,” Mr Kimelman said.

The market reacted positively to this morning’s news, with Nova’s share price up more than 6% to A$0.033 by early afternoon trade.