Recharge Metals to acquire Wapistan lithium project
Recharge Metals (ASX: REC) has entered into a binding agreement with Canadian company Rockland Resources to acquire the Wapistan lithium project in the country’s prolific James Bay region.
The project comprises 219 mineral claims within two contiguous blocks across 107.2 square kilometres in Québec.
It is proximal to the Mia lithium project owned by Toronto-listed Q2 Metals and the Radis project owned by Ophir Gold Corp.
Wapistan has not previously been subject to lithium or critical minerals exploration as all efforts to date have focused on gold and other metals.
The project is located 120km north of Recharge’s flagship Express lithium discovery and gives the company an opportunity to work on the two assets simultaneously.
Terms of the agreement
Under the terms of the agreement, Recharge will pay Rockland an upfront cash consideration of $552,000 plus another $220,000 cash for payments made in acquiring the project.
The company will also issue Rockland with 5 million Recharge shares, of which 50% will be subject to six months’ voluntary escrow.
Recharge is required to send Rockland a deferred payment of $552,000 on or before six months following completion of the acquisition.
The deferred payment may be funded by a small equity placement however Recharge said this would be assessed once it had completed initial exploration at Wapistan.
In the event that Recharge defaults on deferred cash payment obligation, Rockland will have the right to buy-back 100% of the mineral claims for $1.10.
Recharge will grant a 2% net smelter return royalty to Rockland, which may be reduced to 1% in return for a cash payment of $552,000.
“Belt-scale” development
Recharge managing director Felicity Repacholi-Muir said the acquisition presents the company with a “belt-scale” development in a well-endowed region.
“The easy access to Wapistan, its proximity to other highly successful projects and having geological teams available nearby to start quickly makes this an obvious opportunity to create value for Recharge investors,” she said.
“We plan to be active throughout the summer field season at Wapistan and Express once conditions allow, and we look forward to revealing the potential we see at both projects.”
Endowed terrane
The Wapistan region is developing into one of the most endowed lithium terranes in the world, despite having been subject to minimal exploration over the past 20 years.
The project is located within the Archaean Superior Province of the Canadian Shield, which hosts some of the most significant lithium resources in the world.
The majority of the spodumene-bearing lithium-caesium-tantalum (LCT)-style pegmatites in the James Bay region are hosted within greenstone belt rock types.
Wapistan overlies Yasinski Group “greenstones” comprising mafic volcanic rocks interlayered with intermediate to felsic volcanic and pyroclastic rocks as well as volcano-sedimentary and metasedimentary rocks.
Spodumene pegmatites
The Yasinski greenstones also host spodumene-bearing pegmatites at Mia and Radis.
At Mia, Q2 Metals has identified an 8 kilometre-long lithium trend where numerous occurrences of spodumene pegmatites have been sampled at a reconnaissance scale.
The company has reported 18 outcrop grab samples from the Mia Li-1 occurrence averaging 2.65% lithium oxide.
Ophir has also reported lithium and pegmatite occurrences from historical exploration at Radis.
Share placement
Recharge has received firm commitments from sophisticated and professional investors to raise $1.1 million via the issue of 5.7 million shares at $0.19 each.
Funds raised will be put toward payment of the upfront consideration and the company’s initial exploration at Wapistan which will include a property-wide LiDAR (light detection and ranging) and orthophoto survey; a field-based program of prospecting, rock sampling and geological mapping; and a diamond drilling campaign.
While Recharge did not appoint a lead manager to the placement, the company confirmed assisting brokers would receive 6% in aggregate of the funds raised.