Kula expands lithium ambitions with acquisition near Greenbushes
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Kula is expanding its lithium footprint through the acquisition of a 70% interest in the Kirup project that is within 25km of the giant Greenbushes lithium mine.
The 117km2 tenement (E70/5452) also complements its existing Brunswick lithium project further to the north, where the company recently mapped a large 2km by up to 300m wide pegmatite on the same Donnybrook-Bridgeton shear zone which hosts Greenbushes.
Kula Gold (ASX:KGD) is keen to get cracking on exploration on Kirup, given that multiple pegmatites have already been mapped within a tenement that is in close proximity to the world’s largest hard rock (spodumene) lithium mine.
“What an amazing time to join the company and work on such a suite of projects as the Brunswick, Kirup, Westonia and Boomerang Projects in jurisdictions near some of the biggest mines in the world,” chief executive officer Ric Dawson said.
The company is paying $200,000 for reimbursement of exploration expenditure costs incurred to date and 12 million shares to private company Sentinel Exploration for the 70% stake in Kirup.
It will also free carry Sentinel for its 30% stake to the completion of an economic Feasibility Study viable for bank finance and make a success payment of $2m in shares on completion of a maiden JORC resource of at least 10Mt of ore grading 1% lithium or the same metal equivalent.
The related party transaction – due to both Kula and Sentinel sharing Mark Stowell as their respective chairman – means that an independent expert report will need to be prepared for presentation at an upcoming general meeting for shareholders to consider and approve.
The acquisition is also subject to completion of financial, legal and technical due diligence to the satisfaction of Kula, the purchase of 100% of Merchant Ventures (owned by Stowell) by Sentinel via an option agreement, and regulatory approvals.
This article was developed in collaboration with Kula Gold, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.