Forrestania Resources Ltd (ASX:FRS) has expanded its lithium focus in the James Bay Region of Quebec, Canada, exercising an option and earning a 50% interest in the Hydra Lithium Project (HLP) in joint venture (JV) with ALX Resources Corp (TSX-V:AL).
The Hydra Project covers eight sub-projects of a total of 293 square kilometres, with potential to grow further with additional acquisitions or staking of new claim applications.
Each of the sub-projects is on the margins of, or overlays, prospective greenbelts with outcropping pegmatites identified at several sites across the tenure.
Forrestania believes the project has high potential for lithium-caesium-tantalum (LCT) style pegmatite formations and economic lithium resources, as the world-class lithium district hosts three projects with resources over 30 million tonnes, grading at an average of 1.26% lithium.
Investors have responded positively, with shares as much as 31.82% higher in the first half hour of ASX trading to $0.145.
Strategic lithium foothold
“We are very pleased to have formalised the joint venture with ALX to become 50:50 partners in the Hydra Lithium Project,” Forrestania Resources managing director Michael Anderson said.
“From our perspective securing a strategic foothold in the dynamic James Bay lithium space is hugely complementary to our existing project portfolio back at home in Western Australia and provides us with significant additional discovery potential.
“We very much look forward to collaborating with ALX to unlock that potential.”
FRS expects fieldwork at the Hydra project to resume shortly, having been delayed by forest fires in the James Bay region, led by ALX’s “high quality and experienced team” which the company expects to provide a cost-effective and immediate entry into an “extremely prospective district”.
The Hydra Lithium Project in Quebec, Canada.
Fieldwork at Hydra will focus on systematic prospecting, geological mapping and geochemical sampling. ALX is using a proprietary artificial intelligence process for pegmatite detection by KorrAI to prioritise targets for further exploration.
Terms of the JV
To earn the 50% interest in the HLP Forrestania Resources has now paid ALX Resources Corp (TSX-V:AL):
- An initial C$50,000 non-refundable deposit,
- C$350,000 in cash, and
- C$600,000 in shares [4,579,586 shares based on an AUD:CAD exchange rate of 0.881 and the 10-day volume weighted average Forrestania Resources Ltd (ASX:FRS) price (A$0.1486/share) up to the day prior to the closing date of the transaction].
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