Cadence Minerals Castillo Copper extends 90-day option to acquire Picasso and Litchfield Lithium projects

Cadence Minerals

Cadence Minerals plc (LON:KDNC) has announced that it has been advised by Castillo Copper (ASX/LON:CCZ) that it will be extending the 90-day option to acquire the Picasso and Litchfield Lithium Projects in prime regions in Western Australia and the Northern Territory respectively. This is primarily due to processing delays at the laboratories, due to the huge demand to process samples, which is extending timelines significantly.

For the full Castillo announcement, please click link here

Highlights

· CCZ is extending the 90-day option period to acquire the Litchfield and Picasso Lithium Projects1

– More than 650 surface assays for the Litchfield Lithium Project1, which is contiguous to Core Lithium’s (ASX: CXO) strategic Finniss Lithium Project (JORC compliant ore reserves: 7.4Mt @ 1.3% Li2O)2, remain in process queues at the laboratory

– Analysing and interpreting these assay results should potentially enable CCZ’s geology team to determine if lithium mineralisation is contiguous between the Lichfield and Finniss Lithium Projects1

· Under the terms of the option agreement, the extension remains effective until 30 days after the receipt of the full suite of assay results.

Option Extended: 

Whilst reviewing available information for both projects has been positive, enhancing their potential to host lithium mineralisation, the assays are critical to enable due diligence to be finalised. This is especially the case for the Litchfield Lithium Project as it is contiguous to CXO’s Finniss Lithium Project which has JORC compliant ore reserves of 7.4Mt @ 1.3% Li2O2

There are over 650 surface samples from four zones on the boundary with the Finniss Lithium Project. Analysing and interpreting these assay results should enable CCZ’s geology team to potentially determine if there is contiguous lithium mineralisation apparent and finalise due diligence.

Due to unprecedented demand, the timelines to process samples at laboratories have been extended significantly. Synergy’s geology team are in regular contact with the laboratories and hope to have clarity on when the assays will be received shortly.

Overview

Lithium Technologies Pty Ltd and Lithium Supplies Pty Ltd, in which Cadence Minerals owns a 31.5% shareholding, each own 50% of Synergy Prospecting Pty Ltd and have granted , as announced on 29 September 2021, Castillo a 90-day option to acquire 100% of the outstanding shares of LT and LS and by implication 100% of Synergy.

During this 90-day period, Castillo will be conducting due diligence on all three entities to ensure the underlying assets are in good standing and there are no material adverse issues. Under the terms of the option agreement, Castillo can exercise its right to acquire LT, LS and Synergy at any time during the 90-day period.

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Castillo Copper Limited is an Australian-based explorer primarily focused on copper across Australia and Zambia.

The primary assets of Synergy, which are wholly-owned, comprise the Litchfield Lithium Project (EL31774) in NT and Picasso Lithium Project (E63/1888) in WA. In addition, Synergy has an application in NT – EL31828 – known as the Alcoota Lithium Project, which comprises ground proximal to Alice Springs. Castillo will need to undertake further geological due diligence on this application.

LT and LS also hold applications for six lithium properties in San Luis Province, Central Argentina. Again, Castillo will need to undertake further geological due diligence on these applications.

Further details on these assets and all the applications and permits are contained on our website here

Option terms & consideration

The terms of the 90-day option are as follows:

· A$50,000 non-refundable deposit in cash on formally granting the option that will go directly to Synergy for working capital purposes.

Upon exercising the option within the 90-day period, the binding consideration terms are as follows:

· A$1m script payment in CCZ shares will become payable to the Vendor Group based on the 14-day WVAP calculated from the date of which the option agreement is announced to the ASX. Note, the Vendor Group will be subject to a 6-month voluntary escrow period for 50% of the shares and 12-months for the 50% balance from the date of settlement. In addition, both parties agree to sign off on a binding term sheet.

Incremental consideration terms are applicable if the following milestones are achieved:

· A$1m script payment in CCZ’s shares to the Vendor Group based on the 14-day WVAP if two drill-holes produce assayed intercepts greater or equal to a true width of at least 10m @ 1.3% Li2O.Note, the two holes will be at least 100m apart, but not greater than 200m.

· A$1m script payment in CCZ’s shares to the Vendor Group based on the 14-day WVAP if a JORC compliant total inferred resource of at least 7Mt @ 1.3% Li2O is modelled by SRK Consulting.

· In the event of commercial mining operations commencing a 2% NSR will be payable to the nominees of the facilitator.  

References

1)  CCZ ASX Release – 29 September & 20 October 2021

2)  CXO ASX Release – 21 September 2021 (Annual Report)

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