OzAurum Resources Ltd (ASX:OZM) jumped out of the gates this morning after announcing it was acquiring the Linopolis Jaime hard rock lithium project in the Brazilian state of Minas Gerais that boasts spodumene crystals of a metre long.
Shares in the company were up as high as 290% on the news that it has entered into a binding term sheet for the option to acquire the Brazilian project, which being “prolific in pegmatites”, comes as a strategic addition to its Mulgabbie and Patricia Gold projects in Western Australia.
The Linopolis Jaime project — with a +7m wide spodumene zone with an average grade of spodumene crystals of 6.94% lithium oxide, and coarse spodumene crystals up to 1m in length — offers an immediate drill target and “potential for a new lithium discovery”.
This is a classic lithium-bearing pegmatite geological setting and pegmatite type. The project is around 200 kilometres south of the Sigma Lithium’s Grota do Cirilo open pit project that has reserves of 54.8 million tonnes at 1.44% lithium oxide and is currently in production, along with the Companhia Brasileira de Litio (CBL) underground lithium mine.
OzAurum CEO and managing director Andrew Pumphrey said: “It’s an exciting opportunity. You don’t see spodumene crystals a metre long."
He noted that while coarse spodumene crystals of up to 1 metre long are rare in lithium deposits, they are also seen at Greenbushes and Mt Marion in Western Australia.
Linopolis Jaime Project
The Linopolis Jaime Project is 65 kilometres east-northeast of Governador Valadares, in the state of Minas Gerais with the mineral rights covering a 240-hectare area.
The project hosts more than 20 recently mapped lithium-caesium-tantalum (LCT) bearing pegmatites that have been mined intermittently for tantalite, beryl, tourmaline, brazilianite and feldspar by the Pacheco family and other artisanal miners for more than 50 years. No modern exploration has been undertaken on the project area for lithium or other minerals.
However, the project boasts spodumene grades of up to 7.36% lithium oxide (LiO2) with an average spodumene grade of 6.94% LiO2.
This was confirmed within a more than 7 metre wide spodumene zone, consisting of at least 20% volume coarse spodumene crystals up to 1 metre in length mapped over +7m in true width at the Sito do Estevinho underground mine workings.
New applications have been lodged for 19,700 hectares of additional exploration licences in areas within 65 kilometres of the Linopolis Jaime Project. This new ground is considered by OzAurum to be highly prospective for lithium discoveries, being the southern extension of the known LCT pegmatite belt and adjoins existing tenements granted for mining beryl.
An ideal lithium opportunity
OzAurum CEO and managing director Andrew Pumphrey said: “We believe this is an ideal opportunity for the company to acquire strategic lithium projects in addition to the Mulgabbie and Patricia Gold Projects in Western Australia.
"In particular, the advanced Jaime Linopolis lithium Project with a +7m wide spodumene zone with an average grade of spodumene crystals of 6.94% LiO2 offers an immediate drill target and potential for a new lithium discovery.
“Significant upside also exists with over 20 LCT pegmatites identified within the project area to date. Coarse spodumene crystals up to 1 metre in length are rare in lithium deposits and are also seen at Greenbushes and Mt Marion in Western Australia.
“Brazil is fast becoming a Tier 1 hard rock lithium producing jurisdiction in the world with Sigma Lithium leading the charge with a targeted production rate of 104,000 tonnes-per-annum lithium carbonate equivalent LCE from a hardrock reserve base of 54.8 million tonnes at 1.44% LiO2 and also CBL’s underground lithium mine. Both are located only 200 kilometres north of the project.
We are very excited by the opportunities that these projects will bring to the company and look forward to exploring and providing updates to shareholders.”
The terms
The term sheet gives OzAurum the exclusive right to conduct due diligence, which if satisfied will see the company granted an option to acquire the project for total consideration of US$800,000 to be paid in cash instalments over 24 months.