Alba Mineral Resources PLC has announced the acquisition of an option to purchase a 50% interest in a package of highly prospective lithium exploration licenses in the West Pilbara, Western Australia. The Andover West Lithium Project, comprising exploration license E47-3373 ("AW1") and exploration license application ELA47-4844 ("AW2"), has shown significant lithium potential, with neighboring tenements reporting thick, high-grade lithium intersections. The Andover Project's 60% owner, Azure Minerals, is currently the subject of an approved takeover by Hancock Prospecting and SQM, valuing Azure at A$1.7 billion.
Western Australia already hosts four of the world's biggest lithium mines, with combined reserves exceeding 500 Mt. The favorable geology within the Optioned Licenses is indicative of the significant lithium potential of the Andover West Lithium Project. Alba has secured an option to acquire an initial 50% interest in the lithium rights over the Optioned Licenses and will pay GBP 250,000 in Alba shares at a premium of 25% above the VWAP of Alba ordinary shares in the 15 trading days prior to the exercise of the option plus 1 for 1 attaching 12-month share warrants at an exercise price of 0.2p per share.
An unincorporated joint venture shall be formed for the exploration of the lithium rights over the Tenements, with each party contributing to expenditures on a pro rata basis and Alba being appointed Manager with ultimate responsibility for setting budgets and work programs. Alba shall have pre-emption rights and a separate tag-along right in respect of any sale or disposal by the other JV partner of its 50% of the lithium rights in the Tenements.
George Frangeskides, Alba's Executive Chairman, expressed delight in securing the option, stating, "We now have a foothold in a world-class mining district to explore for a commodity that is absolutely fundamental to the global energy transition." The company takes a medium to long-term view as they seek to build value for their shareholders. The Andover West Lithium Project represents a significant opportunity for Alba to tap into the growing demand for lithium, which is essential for the global energy transition.