Ardiden Limited is set to receive an $8.7m shot in the arm from the proposed sale of 80 per cent of its lithium assets in Canada. The sale will allow the company to focus on the Pickle Lake gold project whilst retaining some lithium upside courtesy of a proposed 20 per cent free carried interest in the lithium assets to be sold.
Ardiden already has its hands full at the 870 square kilometre Pickle Lake project in Ontario, with no less than 22 gold deposits and prospects identified by the company. The jewel in the crown at Pickle Lake is the Kasagiminnis deposit boasting a maiden 790,000-tonne resource going at an impressive 4.3 grams per tonne gold for 110,000 ounces of the precious yellow metal.
The company aspires to build a significant high-grade resource base at Pickle Lake, with Kasagiminnis representing just one of multiple deposit-scale targets and advanced gold prospects that Ardiden plans to systematically explore across 120km of strike at the project.
The potential sale of the lithium assets to the newly founded company, Great Northern Lithium is being carried out via a 60-day option agreement that will allow for Great Northern to carry out due diligence before going unconditional.
Great Northern is an Australian company focused on exploring and developing hard rock lithium deposits in North America. Ardiden says Great Northern has commenced works required for an IPO as it looks to list on the ASX.
Under the terms of the option agreement, Ardiden will initially receive a $200,000 that is non-refundable.
Ardiden will pocket a further $1.5 million cash at completion of the transaction, should Great Northern exercise the option to acquire the lithium assets.
Two further instalments totalling $7 million are due to Ardiden with $3.5m payable 9 months after the completion date of the agreement and another A$3.5m is due 18 months after completion. The two instalments will either be paid in cash or shares at Great Northern’s discretion.
Should Great Northern exercise the option to acquire the projects, Ardiden’s 20 per cent free carry will hold all the way up either a bankable feasibility study or a decision to mine.
Ardiden Limited Non-Executive Chairman, Neil Hackett said: “Ardiden has been actively evaluating strategic options to best realise the full potential of its lithium assets. The prospect of selling 80% of Ardiden’s lithium portfolio to a new, lithium-focused entity provides an opportunity to accelerate exploration and development of these quality assets within the booming battery metals sector.”
Ardiden Limited Managing Director and CEO, Robin Longley added: “Monetising 80% of our lithium portfolio provides exploration capital to Ardiden, which will be deployed at its highly prospective package of gold prospects at the Pickle Lake Gold Project.”
Ardiden holds 100 per cent ownership of the three hard rock lithium projects being considered as part of the option agreement. The Seymour Lake, Wisa Lake and Root Lake projects are all located in Ontario.
Seymour Lake already hosts a resource of 4.8 million tonnes going 1.25 per cent lithium oxide, whilst at Wisa Lake, 5 drill-ready targets are reported by the company. Root Lake is located close to Pickle Lake gold and reportedly hosts historical resources and multiple outcrops with walk-up drill targets.
With a bag full of targets at Pickle Lake screaming to be drilled and a gold resource that looks set to grow as Ardiden continues to put down the drill metres, the company’s lithium assets were buried in its long list of prospects.
They now look set to get some love from Great Northern and with 4.8m tonnes already going 1.25 per cent lithium oxide, this could get interesting Ardiden’s 20 per cent free carry will sit there as a blue-sky option on the lithium market as Ardiden focusses on its rapidly advancing gold prospects.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Matt Birney
