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iTech Minerals (ASX: ITM) is pleased to announce that iTech and Sociedad Química y Minera de Chile (SQM) have executed a binding, Farm-in agreement on the Reynolds Range Lithium Project in the Northern Territory.
SQM has completed due diligence on the Reynolds Range Lithium Project and has now joined iTech in executing a formal Farm-in agreement for the project.
With SQM initially funding and managing all aspects of lithium exploration and development, iTech can focus its resources on exploration of the copper and gold potential of the Reynolds Range tenement package of which it retains 100% ownership. iTech looks forward to a valuable and productive working relationship with SQM as we explore this exciting new region side by side.
HIGHLIGHTS
- The Agreement brings both the technical and financial resources of one of the world’s largest lithium chemicals producers to a new lithium pegmatite discovery in the Northern Territory.
- The Agreement is consistent with the initial binding Memorandum of Understanding announced on 22 November 2024.
- SQM has the right to earn into the lithium mineral rights on the Reynolds Range Lithium Project (iTech retains 100% of the rights to all other minerals including copper and gold). SQM holds an immediate 30% interest in the lithium rights by paying an initial fee of A$2 million.
- SQM has the option to earn up to 51% in the lithium rights by spending A$7 million on exploration, within 4.5 years of the commencement date, with a minimum spend of A$2 million within the first 1.5 years.
- SQM has the option to earn up to 70% in the lithium rights by paying an additional A$3 million to iTech and defining a JORC (2012) compliant Mineral Resource Estimate exceeding 50Mt @ 1.0% Li2O or equivalent or spending an additional A$15 million on exploration.
- Payment of a one-off success fee will be payable by SQM upon completion of a definitive feasibility study and a decision to mine. The fee will be calculated based on the lithium oxide content in the resource.
- SQM will operate the project during the earn-in period.
- iTech and SQM will create a technical committee to oversee the development of the Reynolds Range Lithium Project. The committee will have equal representation of members from SQM and iTech.
- SQM has now successfully completed due diligence on the project.
- The Joint Venture and Mineral Right Agreements have been completed but are still subject to a condition precedent which requires the approval of the Central Land Council (CLC) which cannot be unreasonably withheld.
- Both parties will be working closely with the CLC to finalise this condition precedent in coming weeks.
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WATCH: In this Exploration Update, MD Mike Schwarz discusses the reasons why iTech has entered into the partnership with SQM. (5min)
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