Galileo Mining has announced that two of its subsidiaries, Norseman Resources and Ganymede Resources, have entered into an exploration joint venture agreement with a subsidiary of Mineral Resources.
Under the joint venture agreement (JVA) Galileo will, subject to the satisfaction of the completion terms, sell 30 per cent of all lithium rights held by Galileo on the Norseman tenement package for $7.5 million cash consideration.
Galileo’s Managing Director, Brad Underwood, said that Galileo is excited to add a lithium exploration joint venture to its ongoing exploration programs for PGEs and nickel at its Norseman Project.
“The Norseman project has excellent lithium potential and is strategically located in the world’s most prospective region for lithium,” Mr Underwood said.
“The project’s outstanding location relative to existing infrastructure provides a short cut to development for any lithium resources discovered through the joint venture.
“Galileo will benefit from a focussed program of lithium exploration by MinRes, one of Australia’s pre-eminent lithium companies, as well as increasing our cash reserves to aggressively pursue other high value resource discoveries at both our Norseman and Fraser Range projects.
“With $5 million of additional funding to be received within five days of execution of the agreement, a further $2.5 million to be received within 12 months and $10 million in the bank, Galileo is fully funded to undertake all of its planned exploration programs.”
From completion, MinRes’ subsidiary and Galileo will form a 30/70 unincorporated joint venture. MinRes’ subsidiary has the ability to increase its stake to 55 per cent by sole funding an additional $15 million of exploration expenditure on the tenements over the four years following completion.
MinRes’ subsidiary has the further ability to elect to increase its stake to 70 per cent by sole funding expenditure through to a Decision to Mine. Upon MinRes’ subsidiary earning a 70 per cent interest, Galileo must elect to either remain in joint venture and contribute to Development Costs or convert its interest into a royalty.
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