REG - Alien Metals Limited - A$4m Farm-Out JV for Lithium Rights at Pinderi

Alien MetalsAnnouncement

29/04/2024 14:00

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RNS Number : 4493M  Alien Metals Limited  29 April 2024

 

 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (596/2014/EU) AS THE SAME HAS BEEN RETAINED IN UK LAW AS AMENDED BY THE MARKET ABUSE (AMENDMENT) (EU EXIT) REGULATIONS (SI 2019/310). UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.
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Trading Symbols

AIM: UFO

FWB: I3A1

29 April 2024

Alien Metals Ltd

("Alien Metals" or "the Company")

Alien Executes up to A$4 million Farm-Out Joint Venture for Lithium Rights on
Pinderi Hills Project, including A$0.5 million Subscription

 

Alien Metals (AIM: UFO) (Alien or Company), a company focused on the
exploration and development of the Hancock iron ore Project ("Hancock
Project") and the Pinderi Hills project in Western Australia ("Pinderi Hills
Project"), is pleased to announce that it, via its wholly owned subsidiary
Alien Metals Australia Pty Ltd ("AMA"), has entered into a joint venture with
Errawarra Resources Ltd (ASX: ERW) ("Errawarra") (together with AMA, the
"Parties") (the "Agreement") in respect of the lithium rights on the Pinderi
Hills Project located in the West Pilbara (the "Project").

 

Highlights:

•       Errawarra, the joint venture party, has the potential to earn
up to a 50% interest in the lithium rights in the Project by spending up to
A$4 million with the first A$500,000 being by way of a subscription for common
shares in the capital of the Company ("Common Shares").

•     Alien Metals has undertaken limited exploration for lithium in this
area, however the Agreement provides an opportunity to facilitate the
development of the Project whilst allowing the Company to remain focussed on
the development of the Hancock Project and Pinderi Hills nickel, copper, and
platinum group metals projects.

•     The Pinderi Hills area covers a major ultramafic/mafic complex
which is potentially prospective for lithium bearing pegmatites.

•     The West Pilbara is a prospective emerging lithium province, with
interpreted pegmatite dykes (see Figure 2) which the Directors of Alien
believe are comparable to the recently discovered Lithium Caesium Tantalum
("LCT") pegmatites within the Andover intrusive mafic-ultramafic Complex
located 35km to the north-east.

 

Joint Venture Terms and Additional Details

Under the terms of the Agreement, Errawarra is to spend up to a total of
A$4,000,000 to earn up to a 50% participating interest in the joint venture
which will hold the lithium rights on the Project over a period of 60 months,
from entering into the Agreement, as follows:

 

•    Upon execution of the Agreement, a one-off payment of A$500,000 to
Alien by way of a subscription for 130,000,000 new Common Shares at a price of
0.2p (the "Subscription Shares"), being the VWAP over the ten trading days
prior to the date of the Agreement (the "Subscription"). The proceeds of the
Subscription will be applied to general working capital purposes.

•     Stage 1: Errawarra will earn-in for a 25% participating interest in
the joint venture by spending A$1m on the Project within 24 months of the date
of entering into the Agreement; and

•      Stage 2: Errawarra will earn-in for a further 25% participating
interest in the joint venture by spending a further A$2.5m on the Project
within 60 months of the date of entering into the Agreement.

 

At the conclusion of Stage 2, Errawarra's interest in the Project will be 50%
and from that point, the Parties will contribute towards any Project related
expenditure on a pro-rata basis.

 

If Errawarra does not meet the required spend (as noted above) in either Stage
1 or Stage 2, its interest in the joint venture will reduce proportionally.

 

If AMA chooses not to contribute on a pro-rata basis following the completion
of Errawarra's Stage 2 earn-in, AMA's 50% interest will dilute on a pro rata
basis, and in the event that AMA's interest in the joint venture falls below
10% then its remaining holding will convert to a 2% gross revenue royalty (the
"Royalty").

 

Errawarra retains a first right of refusal to buy back the Royalty, should
Alien wish to sell and Errawarra will have first right of refusal to acquire
all the remaining mineral rights to the Pinderi Hills nickel, copper, and
platinum group metals projects.

 

The lithium rights the subject of the Agreement ("Rights") incurred no revenue
or costs in the last 12-month period,  and accordingly there are no
attributable profits or losses. Further the Rights have a zero carrying value
in the Company's financial statements.

 

AMA and Errawarra have agreed to negotiate a full form joint venture agreement
incorporating the above terms within three months from the date of the
Agreement.

 

Lithium Pegmatite Targets Identified

The Pinderi Hills tenements are in an area believed to be prospective for
lithium bearing pegmatites due to the presence of granites belonging to the
Orpheus suite of rocks. These granites are associated with lithium pegmatite
emplacement in the significantly mineralised lithium pegmatite corridor
located some 20km to the north.

LCT pegmatite target areas have been identified near "hot" granites in
greenstone mafic-ultramafic rocks terrane within the Alien tenements.

A large number of pegmatite type features were identified in the Maitland
Intrusive Complex which are interpreted as possible pegmatite dyke swarms.
These interpreted pegmatite dykes are shown in more detail in Figure 2 and
appear comparable to the recently discovered LCT pegmatites within the Andover
Intrusive Complex located 35km to the north-east.

Admission and Total Voting Rights

Application will be made to the London Stock Exchange for the Subscription
Shares to be admitted to trading on AIM ("Admission"). Assuming receipt of the
proceeds of the Subscription have been received, it is expected that Admission
will become effective and that dealings in the Placement Shares on AIM will
commence at 8.00 a.m. on or around 3 May 2024.

The Subscription Shares will be issued fully paid and will rank pari passu in
all respects with the Company's existing Common Shares.

Following Admission, the total number of Common Shares in the capital of the
Company in issue will be 6,491,794,174 with voting rights. This figure may be
used by shareholders as the denominator for the calculations by which they
will determine if they are required to notify their interest in, or a change
to their interest in, the Company's issued share capital pursuant to the
Company's Articles.

 

Guy Robertson, Executive Director, commented:

"This farm-out of the lithium mineral rights to Errawarra provides Alien with
the opportunity to expand its multi commodity portfolio while continuing to
focus on the development of its Hancock Iron Ore, and Pinderi Hills platinum,
nickel, and copper projects.

"Errawarra has immediate plans to commence exploration for lithium on the
project."

 

For further information please visit the Company's website
at www.alienmetals.uk (https://www.alienmetals.uk/) or contact:

 

Strand Hanson (Financial and Nominated Adviser)

James Harris / James Dance / Robert Collins   Tel: +44 (0) 207 409 3494

 

WH Ireland Ltd (Broker)

Harry Ansell / Katy Mitchell   Tel: +44 (0) 207 220 1666

 

Yellow Jersey (Financial PR)

Charles Goodwin / Shivantha Thambirajah / Zara McKinlay   Tel: +44 (0) 203
004 9512

 

Notes to Editors

 

Alien Metals Ltd is a mining exploration and development company listed on the
AIM market of the London Stock Exchange (AIM: UFO). The Company's focus is on
delivering a profitable direct shipping iron ore operation from it 90% Hancock
iron ore project in the central Pilbara region of Western Australia. The
Hancock tenements currently contain a JORC-compliant resource of 8.4Mt iron
ore @ 60% Fe and offer significant exploration upside which is targeted to
deliver a mining operation of 2Mtpa for 10 years.

 

These tenements have direct access to the Great Northern Highway, which
provides an essential export route to export facilities at Port Hedland, from
where more than 500Mt of iron ore is exported annually (30% of global
production). The Company also has an interest in two iron ore exploration
projects Brockman and Vivash, located in the West Pilbara.

 

The Company owns the Elizabeth Hill Silver Project, located near Karratha in
the Pilbara, which consists of the Elizabeth Hill Mining Lease and exploration
tenements surrounding the historical silver mine which has produced some of
Australia's highest-grade silver ore during the late 1990's.  The Company
also owns one of Australia's largest PGM deposits, Munni Munni which hosts a
deposit containing a historic resource of 2.2Moz PGM (Palladium, Platinum,
Gold, and Rhodium).

 

 

 

 

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