Solis Minerals Announces Mina Vermelha Project Acquisition
HIGHLIGHTS
- Solis has entered into option agreement to purchase the Mina Vermelha Project.
- Mina Vermelha is in the Borborema district of Rio Grande do Norte, and along the same mineralised regional trend as the Estrela Project.
- The Mina Vermelha tenement covers approximately 500 hectares with a granted mining lease of six hectares over one of the six currently known outcropping pegmatites on the lease.
- Solis has confirmed grades in grab samples of 3.45% and 3.07% Li2O from outcropping pegmatites and a Caesium assay of 28.3% Cs from an area within the southernmost pegmatite with abundant pollucite (Caesium mineral) confirming the system is LCT (Lithium-Caesium-Tantalum) bearing.
- Drilling is scheduled to commence in approximately four weeks with a large track mounted diamond rig being mobilised for a 1,300m, eight hole initial programme.
- A 12-month due diligence period has been agreed for AUD $155,000, allowing Solis sufficient time to fully evaluate the asset potential before exercising the option to purchase.
- Negotiations regarding the option agreement over the Jaguar Project have been concluded with the Company electing to withdraw from the Project.
Vancouver, October 12, 2023 - Solis Minerals Ltd. (ASX: SLM) ("Solis" or the "Company") is pleased to announce an update on entering into an option agreement to purchase the Mina Vermelha Project targeting lithium pegmatites in the Borborema province of Brazil.
Executive Director, Matthew Boyes, commented:
"The Mina Vermelha Project represents a large and very prospective area with known LCT (Lithium-Caesium-Tantalum) bearing pegmatites located at surface. A rig will be mobilised to site within four weeks for the initial drilling programme to test the continuity and thickness of the identified mineralised pegmatite at depth. This will give us confidence in the potential for a large mineralised system within the tenement package and allow us to move forward with the acquisition.
"We have identified over 2km strike of known pegmatite outcropping at surface, with no drilling completed to date. This sets up an exciting quarter for us, with drilling programmes at both Mina Vermelha and elsewhere in Borborema, and we continue to evaluate new opportunities in this exciting emerging Brazilian lithium province."
Mina Vermelha Lithium Project
The Mina Vermelha Project is located approximately 16km to the south of the regional centre of Parelhas, a city of 25,000 people in which Solis has established a permanent office and logistical support for the upcoming drill campaigns. The project is located on tenement number 840.041/1985 (see Figures 1 & 2) and has a granted mining lease covering approximately six hectares of the south portion of the lease. No systematic exploration has been carried out on the asset to date. Five small artisanal workings have been developed since 1985 targeting feldspar, mica, quartz and beryl production (Figure 4). No specific lithium exploration has taken place.
Figure 1: Tenements held or optioned to Solis in Borborema. The new Mina Vermelha Project is labelled as "24".
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Figure 2: Mina Vermelha tenement with identified outcrops labelled and locations of grab samples shown.
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Solis' geologists have visited the site on multiple occasions and during these trips, six outcropping pegmatite bodies have been identified. Spodumene and Pollucite (a Caesium mineral) have been collected in hand specimens with spodumene concentrations increasing at depth from surface (Tables 1 & 2). The pegmatite bodies are hosted in a meta sedimentary unit within a north-east south-west trending corridor that that hosts the majority of the known lithium-bearing pegmatites in the Borborema province (Figure 3).
Solis has secured an initial drilling rig for an upcoming 1,300m 8-hole program and is currently looking to secure a second rig. Walk up targets and excellent access for a track mounted machine will enable the initial programme.
Figure 3: Drone image looking south to north along the strike of the outcropping and previously mined pegmatite bodies at Mina Vermelha, with a circa 2km corridor outlined in red.
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Sample ID | Certificate code | Northing | Easting | RL | Nb ppm | Ta ppm | Li% | Li2O | Mineral |
OM00019 | GQ2305549 | 9245956 | 759905 | 434 | -10 | 46 | 1.6 | 3.44 | Spodumene |
OM00021 | GQ2305549 | 9245956 | 759905 | 434 | >10000 | >10000 | 0.01 | 0.01 | Tantalite |
OM00035 | GQ2305549 | 9246144 | 759966 | 434 | -10 | -10 | 0.57 | 1.23 | Spodumene |
OM00037 | GQ2305549 | 9246144 | 759966 | 434 | -10 | -10 | 1.43 | 3.07 | Spodumene |
Table 1: SGS Brazil ICP results for grab samples of Spodumene and Tantalite Mina Vermelha.
Sample ID | Certificate code | Northing | Easting | RL | Li ppm | Rb ppm | Cs % |
MV001 | PH23152362 | 9246144 | 759966 | 434 | 36.7 | 9000 | 28.3 |
Table 2: ALS laboratory results for MV001 grab sample of Pollucite from Mina Vermelha.
Figure 4: Large outcropping pegmatites in artisanal working up to 25m in thickness with visible Pollucite and Spodumene. Grab samples OM0035 and OM0037 (see Table 1 and Figure 1) were sampled from this artisanal working at Mina Vermelha.
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Mina Vermelha Deal Structure
Solis' 100% owned Brazilian subsidiary, Onça Mineracao ("Onça"), has agreed to the following terms to acquire the Mina Vermelha ("Red Mine" in Portuguese) Project in Rio Grande do Norte province.
The total consideration for Solis to acquire a 100% interest in the New Project, Onça, will be required to pay the Vendor1 an aggregate BRL$25.5M (~AUD $7.9M) in cash.
The consideration is payable in the following tranches, which are at the election of Solis other than Tranche 1, in Brazilian Reais (BRL), which have been converted to AUD at a BRL:AUD exchange rate of $1.00:$0.31 based on exchange rates as at 6 September 2023.
Mina Vermelha acquisition tranches | |||
Tranche | Payment Date | Cash | |
BRL$ | AUD$ | ||
1. | Option Fee Upon signing the option agreement, which will grant the Group a 12-month period to conduct due diligence on the New Project (Due Diligence Period) | 500,000 | 155,000 |
2. | Option Exercise Fee Prior to the conclusion of the Due Diligence Period (Option Exercise Date) | 10,000,000 | 3,100,000 |
3. | First Deferred Consideration The date that is 12 months from the Option Exercise Date | 10,000,000 | 3,100,000 |
4. | Second Deferred Consideration The date that is 18 months from the Option Exercise Date | 5,000,000 | 1,550,000 |
TOTAL | 25,500,000 | 7,905,000 |
Table 3: Payment schedule for the acquisition of Mina Vermelha.
If Solis elects to satisfy the Option Exercise Fee, Onça will acquire a 100% interest in the Project. However, if Onça does not elect to pay the First Deferred Consideration and/or Second Deferred Consideration then the 100% interest in the New Project will be transferred back to the Vendor and Onça will forfeit all consideration paid to the Vendor to date.
In addition to the payment plan in Table 3, the vendor will receive a 1.5% net smelter royalty (NSR) that Solis has the right to purchase for an amount determined by an independent third- party evaluation of the Mina Vermelha asset.
ASX have confirmed that Listing Rules 11.1.2 and 11.1.3 do not apply to the entry into the option agreement.
Relinquishment of the Jaguar Project
Negotiations regarding the additional extension to the due diligence period for the Jaguar Project to conduct sufficient exploration to justify the acquisition price have been concluded without reaching satisfactory terms with the Vendor. The lack of conclusive positive exploration results from the initial drill holes did not give the Company confidence that the project contained sufficient potential for grade or scale to continue with the acquisition. All claims over the project have now been relinquished by Solis and Onça Mineracao moving forward.
Related Party Information for Recently Closed Private Placement
To provide additional information regarding the closing of the financing on August 21, 2023, the Company confirms that Participation of insiders in the placement constituted a related- party transaction, as defined under Multilateral Instrument 61-101 (Protection of Minority Security Holders in Special Transactions). The issuance of the securities is exempt from the formal valuation requirements of Section 5.4 of MI 61-101, pursuant to Subsection 5.5(a) of MI 61-101, and exempt from the minority shareholder approval requirements of Section 5.6 of MI 61-101, pursuant to Subsection 5.7(1)(a) of MI 61-101.
ENDS
This announcement is authorised by Matthew Boyes, Executive Director of Solis Minerals Ltd.
Australia
Matt Boyes
Executive Director
Solis Minerals Ltd.
+61 8 6117 4795
Jonathan van Hazel
Investor Relations
Citadel-MAGNUS
+61 (0) 411 564 969
North America
Jason Cubitt
VP of Administration
Solis Minerals Ltd.
+1 (604) 209 1658
Neither the TSX Venture Exchange nor its Regulation Service Provider (as the term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy of accuracy of this news release.
About Solis Minerals Ltd.
Solis Minerals is an emerging lithium explorer focusing on Latin American battery minerals.
The Company owns a 100% interest in the Borborema Lithium Project in NE Brazil, covering 25,600ha.
Brazil is rapidly growing in global importance as an exporter of lithium to supply increasing demand of battery manufacturers. Both projects cover highly prospective, hard-rock lithium ground on which early-stage reconnaissance mapping and sampling have verified. Drilling programmes are either underway or due to commence shortly.
In addition, Solis also holds a 100% interest in 35,700ha of combined licences and applications of highly prospective IOCG (iron oxide copper/gold) and porphyry copper projects in southwestern Peru within the country's prolific coastal copper belt - a source of nearly half of Peru's copper production.
Forward-Looking Statements
This news release contains certain forward-looking statements that relate to future events or performance and reflect management's current expectations and assumptions. Such forward- looking statements reflect management's current beliefs and are based on assumptions made and information currently available to the Company. Readers are cautioned that these forward- looking statements are neither promises nor guarantees and are subject to risks and uncertainties that may cause future results to differ materially from those expected, including, but not limited to, market conditions, availability of financing, actual results of the Company's exploration and other activities, environmental risks, future metal prices, operating risks, accidents, labour issues, delays in obtaining governmental approvals and permits, and other risks in the mining industry. All the forward-looking statements made in this news release are qualified by these cautionary statements and those in our continuous disclosure filings available on SEDAR at www.sedar.com. These forward-looking statements are made as of the date hereof, and the Company does not assume any obligation to update or revise them to reflect new events or circumstances save as required by applicable law.
Qualified Person Statement
The technical information in this news release was reviewed by Derrick Strickland, P.Geo, a qualified person as defined by National Instrument 43-101 (NI 43-101).
Competent Person Statement
The information in this ASX release concerning Geological Information and Exploration Results is based on and fairly represents information compiled by Mr Matthew Boyes, a Competent Person who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Boyes is an employee of Solis Minerals Ltd. and has sufficient experience which is relevant to the style of mineralisation and types of deposit under consideration and to the exploration activities undertaken to qualify as a Competent Person as defined in the 2012 Edition of the "Australian Code for Reporting of Mineral Resources and Ore Reserves". Mr Boyes consents to the inclusion in this report of the matters based on information in the form and context in which it appears. Mr Boyes has provided his prior written consent regarding the form and context in which the Geological Information and Exploration Results and supporting information are presented in this Announcement.
1 The "Vendor" is Brazilian Corporate Registration (CNPJ) n. 12.035.933/0001-01 and is owned by two partners, Maria de Fátima Targino de Macedo Sena and Luiz Gonzaga de Sena Neto.
APPENDIX 1
JORC Code, 2012 Edition - Table 1
Criteria | JORC Code explanation | Commentary |
Sampling techniques |
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Criteria | JORC Code explanation | Commentary |
Drilling techniques |
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Drill sample recovery |
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Logging |
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Sub-sampling techniques and sample preparation |
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Quality of assay data and laboratory tests |
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Criteria | JORC Code explanation | Commentary |
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Verification of Sampling and assaying |
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Location of data points |
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Data spacing and distribution |
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Orientation of data in relation to geological structure |
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Sample security |
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Audits or reviews |
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Section 2 Reporting of Exploration Results
(Criteria listed in the preceding section also apply to this section)
Criteria | JORC Code explanation | Commentary |
Mineral tenement and land tenure status |
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Exploration done by other parties |
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Geology |
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Drill hole Information |
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Criteria | JORC Code explanation | Commentary |
Data aggregation methods |
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Relationship between mineralisation widths and intercept lengths |
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Diagrams |
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Balanced reporting |
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Other substantive exploration data |
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Further work |
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