Arcadia Minerals

Off-Take And Funding Letter Of Intent Swanson Tantalum/Lithium Project

Arcadia Minerals Ltd (ASX:AM7, FRA:8OH) (Arcadia or the Company), the diversified exploration company targeting a suite of projects aimed at Tantalum, Lithium (Clays, Brines & Hard Rock), Nickel, Copper and Gold in Namibia, is pleased to announce that it has received a letter of intent (LOI) from HeBei Xinjian Construction CC (HeBei) to negotiate and possibly enter into an agreement with Arcadia in terms of which: a) an ever-green off-take of Tantalum Pentoxide concentrate min. 25% metal content and Li2O with min. 1% Li2O metal content will be granted to HeBei, and b) in terms of which HeBei is to provide funding to construct and commission a Tantalum Multi-Gravity-Separation concentrate plant and a Lithium concentrate plant (through Dense Media Separation or Flotation) in return for sharing in the profit of the operations.

HIGHLIGHTS

  • Letter of Intent (LOI) received from Chinese Multinational Group HeBei Xinjian Construction CC
  • LOI is aimed at off-take for Tantalum and Lithium products and to provide construction funding of Tantalum and Lithium Plants at Swanson
  • Arcadia intends to immediately enter into negotiations with HeBei Xinjian Construction CC and to possibly finalise a transaction during Q1 in 2023
  • HeBei recently concluded a similar transaction with neighbouring licence holder Kazera Global PLC (KZG.L)
  • Swanson DFS postponed to early Q1/2023 in order to provide for beneficiation of Lithium ore in view of rising Spodumene prices
  • Ongoing and incomplete discussions remain on foot with several parties

Jurie Wessels, the Executive Chairman of Arcadia stated: “The receipt of the letter of intent from a company of a calibre such as the HeBei Xinjian Construction CC validates our confidence in the Swanson Project becoming a potential early cash generator. We are particularly emboldened by the expression of intent to conduct a profit-sharing arrangement aimed at both the Tantalum and Lithium credits of the Swanson project and to purchase both product streams. Our next steps are to engage with HeBei and other suitors through negotiation to possibly conclude a transaction as early as is reasonably possible. HeBei recently concluded a deal with our neighbour Kazera Global PLC (KZG.L) under similar arrangements, demonstrating the interest for our products.

Interest from various parties has also extended to the Bitterwasser Lithium Clay & Brines project, further validating the potential of the Company’s assets, however at this stage these discussions remain ongoing and incomplete.”

TERMS OF LETTER OF INTENT

The proposed transaction relates only to ore mined from the Swanson Tantalum/Lithium Project located in, on and under Mining License ML 223 (ML223) in the Karas Region of the Republic of Namibia.

The aim is to commence with exploiting the existing JORC Mineral Resource at Swanson, which consists of an Indicated Mineral Resource of 1,439Mt at an average grade of 498 ppm Ta2O5, 72 ppm Nb2O5 and 0.14 % Li2O and an Inferred Mineral Resource of 1,145Mt at an average grade of 472 ppm Ta2O5, 75 ppm Nb2O5 and 0.17 % Li2O1. The D1 pegmatite is expected to be the focus for the purposes of Lithium production as it contains the highest Lithium grade with a total Mineral Resource of 573 Mt at an average grade of 349 ppm Ta2O5, 95 ppm Nb2O5 and 0.38 % Li2O.

The letter of intent envisages the conclusion of:

a) an ever-green off-take agreement of Tantalum Pentoxide (Ta2O5) concentrate min. 25% metal content (Ta-Product), and Lithium Oxide (Li2O) with min. 1% Li2O metal content (Li-Product), in favour of Hebei with respect to Ta-Product and Li-Product mined from ML223 at terms specified below, and;
b) a funding agreement to construct and commission a Tantalum concentrate plant (MGS Plant) and a Lithium concentrate plant through DMS or Flotation (Lithium- Plant) in return for a profit-sharing scheme (Transaction).

Feedstock for the MGS Plant is to consist of Run of Mine Ore from the E-F and D Pegmatites, and any other potential JORC reserves declared from pegmatites over ML223. Feedstock for the Lithium-Plant is to consist of Lithium-containing waste derived from the MGS plant.

This article includes content from Arcadia Minerals, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.

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