Zenith Minerals to sell US lithium assets to JV partner Bradda Head
Zenith Minerals has signed a cash-cum-stock deal worth AUD 1.05 million to sell its 45% stake in its lithium brine, pegmatite, and clay projects in the US to joint venture (JV) partner Bradda Head.
The US lithium assets of the Australian mineral exploration company include the lithium brine plays – the Spencer brine project and the Wilson Salt Flat brine project, which are both located in Nevada. The lithium brine projects are located close to Tesla’s Gigafactory and also to Albermarle’s Silver Peak-Clayton Valley lithium brine operation.
The other lithium assets of Zenith Minerals in the US are the San Domingo project and the Wikieup-Burro Creek project, both located in Arizona.
Zenith Minerals claimed that the US lithium projects are well-positioned to cover future supply to the emerging domestic lithium battery market in the US.
The sale of the transaction will enable the Australian mineral exploration company to continue its focus on its core fully-owned gold and copper projects in Australia.
Zenith Minerals’ core projects include the Red Mountain Gold Project in Queensland, the Split Rocks Gold Project and the Develin Creek Copper-Zinc Project in Western Australia.
As per the terms of the deal, Zenith Minerals will get US$250,000 in cash and 11,768,481 shares in Bradda Head, enabling it to retain a 15% stake in the latter.
The parties have agreed to scrap their joint venture, which was established in 2017 to give Bradda Head a 55% stake in the US lithium assets of Zenith Minerals.
Bradda Head is a lithium exploration group, which is controlled by British billionaire Jim Mellon.
Peter Bird – Zenith Minerals chairman said: “In the case of the United States Lithium Projects we feel that the Bradda Head’s plan to take this portfolio forward in return for a solid equity position (plus cash) is a good solution for both parties. Importantly, the Company will maintain exposure to the United States Lithium Projects through its shareholding interest in Bradda Head.
“As a significant shareholder we will assist as and where we can to ensure a mutual value pathway for both companies and their respective shareholders. We recognise that there is significant interest in this battery metals sector currently and the Bradda Head “pure play” should ensure a good outcome for respective participants.”