Advanced Australian lithium developer Core Lithium (ASX: CXO) has entered into an agreement for the sale of a private royalty from the Finniss Lithium Project in the Northern Territory to Canadian royalty Company, Lithium Royalty Corporation. LRC will pay a total consideration of A$8.125 million for the right to receive 2.5% of gross revenue from the sale of products from Finniss.
Advanced Australian lithium developer Core Lithium Ltd (Core or Company) (ASX:CXO) is pleased to advise that it has, through its wholly owned subsidiaries, entered into an agreement for the sale of a private royalty from the Finniss Lithium Project in the Northern Territory to Canadian royalty Company, Lithium Royalty Corporation (LRC).
• Lithium Royalty Corporation (LRC) invests A$8.125 million for a 2.5% royalty over production from the Finniss Lithium Project
• LRC is a Canadian based company established to pursue investment opportunities in the battery materials sector, with a focus on lithium
• Strategic partnership positions the Company to advance towards becoming the next Australian lithium producer
LRC has established lithium royalties over other high-quality producing and near development lithium assets including Galaxy’s (ASX:GXY) Mt Cattlin Lithium Mine. Under the terms of the agreements, LRC will pay a total consideration of A$8.125 million for the right to receive 2.5% of gross revenue from the sale of products from the Finniss Lithium Project (Royalty).
A$6.875 million of this amount is being paid on execution and held in escrow and released to the Company upon the transaction receiving approval from the Foreign Investment Review Board (Stage 1).
FIRB Approval is expected to be completed within 8 weeks. The balance of A$1.25 million is conditional on the Company announcing a 15 million tonne JORC Mineral Resource for the Finniss Lithium Project and the Company achieving continuous operation of the processing plant for more than 14 consecutive days (Stage 2).
The Royalty rate on receipt of initial proceeds under Stage 1 is 2.115% and increases to 2.50% upon achievement of the Stage 2 milestone and payment of the balance of the purchase price by LRC.
Funds received from the granting of the Royalty will be used to progress the Company’s flagship Finniss Lithium Project towards development, near term resource growth and conversion and exploration focussed on improving the production profile further and extend the mine life within the broader Finniss Lithium Project area and for working capital purposes.