AIM-listed mineral explorer IronRidge Resources can acquire up to 100% of the project through staged earn-in arrangements and expenditure to feasibility study within a 4-year period, subject to a residual net smelter royalty of 2%
Enchi Pro’s royalty will be capped at US$2 million, with IronRidge having the right to acquire the royalty at any time for $1.5 million.
Funding will be used to undertake further exploration work and pending results, define a maiden resource and complete project studies.
The joint venture agreement with Enchi Pro covers 400 km2 where multiple untested pegmatite occurrences have been identified throughout the license.
IronRidge CEO Vincent Mascolo says the acquisition further consolidates its West African lithium portfolio and strategy.
“We see enormous potential in supplying the growing energy industry with lithium and securing the Côte d’Ivoire resource directly complements our recent acquisition activity in this space in Ghana,” says Mascolo, adding thacthe global demand for lithium is increasing at an unprecedented rate since the emergence of consumer electronics, the electric vehicle and energy storage markets, driven by a desire to reduce carbon emissions and improve efficiencies.
“The asset presents a strategic opportunity that consolidates and covers resource scale potential, simple mineralogy and proximity to infrastructure in a mining-friendly jurisdiction.”
IronRidge Resources believes that this endorses the potential for success at the project as a first quartile cost producer, with low capital expenditure requirements and a simple mining and treatment process.
Upon satisfied completion of a due diligence IronRidge will pay $60 000 to Enchi Pro. This will be followed by a $20 000 asset transfer fee and $60 000 on commencement of the scoping study, earning IronRidge an 85% stake in the project.
On commencement of the prefeasibility study, IronRidge will pay Enchi Pro an additional $60 000, earning it a 90% stake in the project, and a further $225 000 will be paid on commencement of the feasibility study, earning IronRidge a 95% stake in the project.
At this point Enchi Pro can either co-contribute or dilute down to a NSR of 2%, at which time IronRidge will have earned 100%.
Completion of the investment is subject to certain conditions being met by the company and Enchi Pro, principally in relation to completion of satisfactory due diligence by IronRidge over the next three months.
IronRidge will be responsible for maintaining the properties during this agreement and up to the completion of the feasibility study.
The project, located within 75 km of the capital, Abidjan, hosts multiple untested pegmatite occurrences, with a reconnaissance field visit identifying multiple outcropping pegmatites over 15 m to 20 m in width and several hundred meters strike with outcrops up to 25 km apart along the interpreted trend.
The project also has excellent infrastructure, logistics and services support to enable potential rapid development of the asset