Piedmont Lithium partners with vinland lithium to advance the killick lithium project in newfoundland.
Piedmont Lithium Inc. (“Piedmont” or the “Company”) (Nasdaq: PLL; ASX: PLL), a leading global supplier of lithium resources critical to the U.S. electric vehicle supply chain, announced a strategic investment in a large prospective lithium project in Newfoundland, Canada.
Piedmont has agreed to pay C$2 million for a 19.9% equity interest in Vinland Lithium Inc. (“Vinland Lithium”), a new entity established with Sokoman Minerals Corp. (“Sokoman Minerals”) (40.1%) and Benton Resources Inc. (“Benton Resources”) (40.1%).
The Company also may earn up to a 62.5% equity interest in Killick Lithium Inc., a wholly-owned subsidiary of Vinland Lithium holding a 100% interest in the Killick Lithium Project (“Killick Lithium” or the “Project”), through a staged investment agreement.
Piedmont will be entitled to 100% marketing rights and a right of first refusal on 100% offtake rights to any lithium concentrate produced by the Project on a life-of-mine basis at competitive commercial rates. Transaction details are provided below.
Geologically, the Killick Lithium property is analogous to the Carolina Tin-Spodumene Belt, which hosts Piedmont’s Carolina Lithium project. The property totals 950 square kilometers and hosts approximately 60 kilometers of prospective strike length. Initial prospecting on the property by Benton Resources and Sokoman Minerals in 2021 led to the discovery of the first occurrence of spodumene-bearing pegmatite in Newfoundland.
According to their data, the work to date of Benton Resources and Sokoman Minerals includes 61 exploratory drill holes, 50 of which intersected spodumene-bearing pegmatites. Mineralization in surface trenching and drilling has now been identified over a strike length of 2.5 kilometers.
These early drilling results include multiple intercepts over 1.0% Li2O and demonstrate the potential for additional discoveries within the property. Their exploration work in 2023 has identified numerous soil and geophysical anomalies, highlighting high-priority drill targets.
The property features excellent infrastructure with close proximity to paved roadways, an electrical substation, and an ice-free, deepwater port.
Patrick Brindle, Chief Operating Officer for Piedmont Lithium, said the partnership supports the Company’s strategy to grow its hard rock lithium resource base with a focus on large targets in attractive locations and furthers Piedmont’s plans to be a major producer of lithium hydroxide for the North American market.
Patrick Brindle, Chief Operating Officer for Piedmont Lithium said:
The Killick Lithium Project comprises a vast land package in an attractive jurisdiction.
“Our team has visited the site on multiple occasions and conducted extensive due diligence. Early exploration results are favorable, and the Project’s location is advantageous in terms of infrastructure and logistics,” said Brindle.
“The Vinland Lithium exploration team is highly experienced and will manage all aspects of the exploration program. While we help fund exploration activities at Killick Lithium, our projects and operations teams remain focused on the ongoing development of our core portfolio, including the producing North American Lithium mine in Quebec and our planned operations in Ghana, Tennessee, and North Carolina.”
Summary of Key Terms of Subscription and Earn-In Agreements
| Item | Details |
| Subscription | Piedmont subscribes for a number of shares in Vinland Lithium as would equal a 19.9% voting and participating interest therein for a subscription price of C$2 million.The subscription agreement includes customary terms and conditions, including representations and warranties and covenants of Vinland Lithium customary for a transaction of this nature. |
| Initial Earn-in Right | Within 30 days following the execution of the earn-in agreement, Piedmont shall have the option, exercisable by notice, to acquire a 16.35% voting and participating interest in Killick Lithium.Piedmont’s initial interest will be conditional upon (i) Piedmont’s issuance of common stock to Sokoman Minerals and Benton Resources having an aggregate subscription price of C$2 million and (ii) Piedmont funding prospecting, exploration, development, and production expenses of Killick Lithium of at least C$6 million (the “Initial Earn-In Amount”) within 30 months of the initial earn-in right notice. |
| First Additional Earn-in Right | Within 60 days following the funding of the Initial Earn-In Amount, Piedmont shall have the option, exercisable by notice, to acquire an additional 21.65% voting and participating interest in Killick Lithium.Piedmont’s first additional interest will be conditional upon (i) Piedmont’s issuance of common stock to Sokoman Minerals and Benton Resources having an aggregate subscription price of C$2 million and (ii) Piedmont funding prospecting, exploration, development, and production expenses of Killick Lithium of at least C$3 million (the “First Additional Earn-In Amount”) within 12 months of the first additional earn-in right notice. |
| Second Additional Earn-in Right | Within 60 days following the funding of the First Additional Earn-In Amount, Piedmont shall have the option, exercisable by notice, to acquire an additional 24.5% voting and participating interest in Killick Lithium.Piedmont’s second additional interest will be conditional upon (i) Piedmont’s issuance of common stock to Sokoman Minerals and Benton Resources having an aggregate subscription price of C$6 million and (ii) Piedmont funding prospecting, exploration, development, and production expenses of Killick Lithium of at least C$3 million (the “Second Additional Earn-In Amount”) within 12 months of the second additional earn-in right notice. |
| Exclusive Marketing Rights and Offtake Rights | Killick Lithium grants Piedmont exclusive marketing rights for the promotion and sale of any lithium products produced from the Project on a life of mine basis.Piedmont shall have the right of first refusal on 100% offtake rights to the lithium concentrates produced from the Project, on a life of mine basis, at competitive commercial rates. |
| NSR | Killick Lithium grants a 2% NSR in favor of Sokoman Minerals and Benton Resources with Killick Lithium, Piedmont, or any of their successors retaining the right to repurchase 50% of such royalty (1%) in consideration for a C$2 million cash payment to Sokoman Minerals and Benton Resources. |
| Operatorship | Sokoman Minerals and Benton Resources shall maintain operatorship of Killick Lithium up to and until the funding of the Second Additional Earn-In Amount.Following funding of the Second Additional Earn-In Amount, Piedmont shall be the operator of the Project and shall manage and execute all prospecting, exploration, development, and production programs and spending on the Project |
About Piedmont Lithium
Piedmont Lithium Inc. (Nasdaq: PLL; ASX: PLL) is developing a world-class, multi-asset, integrated lithium business focused on enabling the transition to a net zero world and the creation of a clean energy economy in North America. Our goal is to become one of the largest lithium hydroxide producers in North America by processing spodumene concentrate produced from assets where we hold an economic interest.
Our projects include our Carolina Lithium and Tennessee Lithium projects in the United States and partnerships in Quebec with Sayona Mining (ASX: SYA) and in Ghana with Atlantic Lithium (AIM: ALL; ASX: A11). These geographically diversified operations will enable us to play a pivotal role in supporting America’s move toward energy independence and the electrification of transportation and energy storage. For more information, follow us on Twitter @PiedmontLithium and visit www.piedmontlithium.com.
Highlights:
- Piedmont to acquire a 19.9% equity interest in newly-formed Vinland Lithium for C$2 million cash consideration
- Through staged investments, Piedmont may earn up to a 62.5% equity interest in Vinland’s Killick Lithium Project
- Killick Lithium’s large land package hosts ~60 kilometers of highly prospective strike length
- Initial exploration results are encouraging, and the Project is logistically advantaged in southern Newfoundland, Canada
- Piedmont will have a right of first refusal on offtake rights to future concentrate production
- Investment is consistent with Piedmont’s strategy of growing its spodumene resource base by investing in projects with large-scale potential in favorable locations, and managed by strong exploration teams
Piedmont Lithium Partners With Vinland Lithium to Advance the Killick Lithium Project in Newfoundland, BELMONT, North Carolina, October 11, 2023
