Raiden is picking up the lithium rights for the Arrow project in the Pilbara

Raiden has further expanded its reach in Western Australia’s Pilbara region after signing an earn-in agreement (with an option to acquire 100%), for the lithium-caesium-tantalum rights (LCT) of a tenement within the Mallina Basin.

While Raiden Resources (ASX:RDN DAX:YM4) already holds 100% of the Arrow project (E47/3476 and E47/3478), which is also considered to be prospective for Hemi-style gold mineralisation (ASX:DEG) – given that it is just 30km along strike from the play-opening project, Arrow Minerals (ASX:AMD) had held the rights to the lithium-caesium-tantalum mineralisation.

This is now changing under the earn-in agreement with Raiden securing the right to earn 85% or outright purchase 100% of the last remaining rights in the project.

And it has good reason to do so, given that the project has just the right type of geology in a proven lithium-pegmatite district, which includes Pilbara Minerals’ producing Pilgangoora project – one of the world’s largest hard rock lithium deposits.

This prospectivity has also drawn a whole host of explorers such as Golden State Mining and Wildcat Resources like flies to honey.

“This transaction significantly expands the company’s lithium portfolio and potential for discovery in the Pilbara, while at the same time complementing our strategy of existing work programs and plans.

The Arrow project is considered highly prospective for Hemi style gold mineralisation, which the Company is evaluating.

“This transaction will allow us to evaluate the lithium potential of the project in tandem with the gold exploration program and provide our shareholders with further exposure to lithium, as well as, to gold potential.”

Arrow project and transaction terms

The 223km² Arrow project includes historical exploration that identified fertile and fractionated granitic intrusions, which could produce mineralised LCT pegmatites.

Rock chip sampling and field observations confirmed that the Satirist Granite, which is considered to be the source of mineralisation in the district – is a potential source rock for LCT bearing pegmatites in the project.

Raiden has the right to earn up an initial 51% in the LCT rights by spending up to $1m on exploration within three years from execution of the agreement.

It can increase this to 75% by spending a further $2m over another three years and paying Arrow either $150,000 in cash or shares.

This can then be taken up to 85% by paying Arrow another $550,000 in cash or shares, incurring the lesser of either another $5m in exploration or the amount required to complete a preliminary feasibility study, and announcing a PFS in relation to any minerals in the project.

Optionally, it can exercise its right to acquire the LCT rights outright during the option phase by paying Arrow $250,000 in cash and another $250,000 in shares, the latter of which is subject to shareholder approval. Arrow will also be granted a 1% net smelter royalty over the LCT minerals if this option is chosen.

This article was developed in collaboration with Raiden Resources, 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.