Perth-based explorer Red Mountain Mining (ASX: RMX) has announced it has acquired 100% of the Nannup project, an exploration licence located southwest of the Greenbushes lithium province in Western Australia.
The new tenure covers 48 square kilometres and is considered prospective for lithium, nickel, gold and base metals.
Red Mountain acquired the project through a binding heads of agreement to purchase 100% of the shares in private tenement holder Airdrie Exploration for a cash consideration of $50,000.
The consideration will be paid in full on settlement of the acquisition, which is expected to be completed in the coming weeks.
Red Mountain said the “commercially favourable” terms of the transaction provide large upside potential in project value growth.
An initial exploration program to identify the lithium, nickel, gold and base metals potential is expected to commence once land access agreements are granted.
In today’s announcement, the company said the acquisition will complement its heavy rare earth elements (HREE) focus at Mt Mansbridge, where it plans to commence an aggressive follow-up exploration program following its recent capital raising.
The Nannup project is located within southwest terrane near the Darling Fault, a major north-south structure with interbedded banded iron formation (BIF) and mafic-ultramafic rocks mapped at surface.
The Nannup project contains a 15km long north-south magnetic anomaly adjacent to the Darling Fault, and according to Red Mountain, potentially related to a second order fault parallel to Darling.
Historical exploration by BHP (ASX: BHP) about 9km south of the Nannup tenement reported multiple lithium anomalies and Red Mountain said it is keen to explore the lithium potential of the project based on these nearby workings.
A recent initial reconnaissance visit also confirmed the evidence of historical gold workings at Majenup within a highly metamorphised and sheared environment. Although due to the extensive secondary cover only a relative small number of coarse grained biotite gneisses lithologies were observed, Red Mountain reported.