Uranium explorer Cauldron Energy is going back to the drawing board after plans to acquire a couple of Pilbara lithium projects fell apart.

Cauldron (ASX:CXU) shares dropped 10 per cent to 3.6c on news that its proposed acquisition of the Marble Bar Lithium and Pippingarra lithium project – announced 5 October – from private explorer Mercury Resources Group would not proceed.

“The acquisition was subject to conditions, some of them which have not been satisfied,” Cauldron told investors.

“As a result, the parties have agreed to terminate the agreement.”

When the WA state government implemented a ban on most new uranium mines in 2017, Cauldron stopped work at its flagship Yanrey uranium project and began searching for advanced exploration plays in other commodities.

In October, the explorer entered into an agreement to buy the Pippingarra and Marble Bar lithium projects for cash and shares.

Cauldron Energy was going to pay Mercury Resources 40 million shares, 40 million options, 60 million performance shares, and $500,000 in cash in two instalments.

The Cauldron share price (ASX:CXU) over the past 12 months.
The Cauldron share price (ASX:CXU) over the past 12 months.

Cauldron had about $1.75 million in the bank at the end of September.

The company says it still has a number of battery metals projects, including some high value copper cobalt projects, “at an advanced stage of negotiation”.

Earlier this week, Cauldron announced that long serving director Tony Sage would step down after Mr Sage’s corporate advisory firm terminated its contract with the explorer.

“The increasing workload of Okewood means it is no longer able to continue to commit to providing services to the company,” Cauldron told investors.