Pilgangoora Minerals farms-in to Venus Metals’ lithium tenements near Pilbara Minerals’ project

Pilgangoora Minerals Pty Ltd Venus Metals Corporation ASX VMC farm-in lithium spodumene pegmatite Pilbara Minerals
Pilgangoora Minerals Pty Ltd has agreed to earn up to 75% of the pegmatite rights in several Venus Metals' projects in WA.

Private entity-Pilgangoora Minerals Pty Ltd has executed an agreement to farm-in to Venus Metals Corporation’s (ASX: VMC) tenements near Pilbara Minerals’ (ASX: PLS) renowned lithium project in Western Australia.

Under the agreement, Pilgangoora has paid $200,000 in cash to give it access to several of Venus’ tenements including the Pilgangoora East, Wodgina South and Poona projects.

The staged earn-in will pave the way for Pilgangoora to spend $1 million on exploration over 12 months. Pilgangoora can then pay Venus an additional $200,000 in cash to secure its initial 25% stake in the pegmatite rights over the tenements.

To boost its interest to 50%, Pilgangoora Minerals can outlay another $1 million on exploration over an additional 12 months and make a cash payment of $350,000 at the end.

This stage will enact an unincorporated 50:50 joint venture between Venus and Pilgangoora.

A stage three earn option is available to Pilgangoora where it can up its interest to 75%. To do this, Pilgangoora must complete a bankable feasibility within five years of earning its 50% interest.

Venus will be free-carried until a decision to mine, with Pilgangoora to retain responsibility for securing project financing. Should a final investment decision be made, Pilgangoora will finance Venus Metals’ share of costs via a development loan. Venus will repay the costs from its portion of production revenue.

Meanwhile, Venus retains the rights to all other non-lithium minerals.

Pilgangoora Minerals is a recently incorporated entity that was registered in early August this year.

Pilbara lithium hub

WA’s mineral-rich Pilbara is an emerging lithium hub, with Pilbara Minerals’ flagship Pilgangoora lithium-tantalum project established about 120km from Port Hedland.

According to Pilbara Minerals, its flagship project hosts one of the world’s largest new spodumene deposits.

Stage one production is ramping up at the project’s 2 million tonnes per annum plant, which is estimated to generate 330,000tpa of spodumene concentrate.

Pilbara Minerals is aiming to become among the top three lithium raw material producers globally by 2020, with a stage two 5Mtpa plant to be commissioned by the end of next year, which is forecast to produce up to 850,000tpa of spodumene concentrate over 17 years.

The company is joined by other advanced explorers and emerging producers in the region including Altura Mining (ASX: AJM), which commissioned its namesake project earlier this year and shipped its maiden spodumene concentrate in October.

Meanwhile, Venus remains focused on unlocking the value of its other lithium, gold and vanadium assets in WA via additional farm-in agreements and active exploration.

Lepidico Ltd (ASX: LPD) is earning an 80% interest Venus’ Youanmi lepidolite project and just reported it had uncovered multiple intercepts during drilling at the project, with assays including 5m at 1.30% lithium.

Venus is free-carried at the Youanmi lithium project to a decision to mine.

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