06/10/2016 - 10:00

Pilbara Minerals buys Dakota project

06/10/2016 - 10:00

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Pilbara Minerals plans to expand its Pilgangoora lithium portfolio with the acquisition of Dakota Minerals’ Lynas Find project for up to $8 million.

Pilbara Minerals buys Dakota project
Pilbara Minerals managing director Ken Brinsden. Photo: Attila Csaszar

Pilbara Minerals plans to expand its Pilgangoora lithium portfolio with the acquisition of Dakota Minerals’ Lynas Find project for up to $8 million.

Pilbara will pay an up-front $4 million to acquire the Lynas Find project, which lies adjacent to its $214 million Pilgangoora lithium project.

It will also pay $1 million once a term extension on one of Lynas Find’s core tenements is granted, plus a further $750,000 for each of four Pilgangoora exploration tenements under application by Dakota.

The payments will be made in either cash or shares, at Pilbara’s discretion.

“The acquisition provides further benefits to Pilbara by increasing tonnes readily accessible to the future processing facilities, growing the company’s lithium exploration footprint in the Pilgangoora district and providing further options to where key infrastructure components for the Pilgangoora project might be located,” Pilbara said in a statement.

“Together with the strategic cooperation agreement signed last month with Pilbara’s other neighbour, Altura Minerals, this means the company has now firmly consolidated its strategic position in this world-class lithium/tantalum district.”

Managing director Ken Brinsden said the Lynas Find acquisition secured the eastern and northern extensions of the Pilgangoora project.

“The Dakota tenement package contains numerous prospective new areas for lithium exploration, helping to strengthen our longer-term growth pipeline,” he said.

“Importantly, this deal also gives us access to a strategic land-holding in close proximity to the existing Pilgangoora resource area which may be suitable for the location of key infrastructure components for the Pilgangoora project – enhancing our development plan.”

Post-transaction, Dakota will be focused on fast-tracking its lithium projects in Portugal.

Chief executive David Frances said the directors saw the Pilbara transaction as a win for Dakota shareholders.

“The transaction puts the company in a very strong financial position to rapidly advance its strategy of becoming a globally significant lithium company and leading supplier of lithium hydroxide and lithium carbonate to the rapidly developing European battery industry,” he said.

Pilbara shares were 3.2 per cent higher to 47.5 cents each, while Dakota shares were 10.8 per cent higher to 8.2 cents each, at 10am.

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