Eureka Lithium Corp. [CSE-ERKA; OTCQB-SCMCF; FSE-S580] signed a letter of intent (LOI) with respect to an option to acquire from Medaro Mining Corp. [CSE-MEDA] (optionor) a 100% undivided interest in and to the mineral claims comprising the optionor’s Lac La Motte project in the mining area of Abitibi, Quebec, subject to a 1% net smelter return (NSR) royalty in favour of the underlying owner.
Jeffrey Wilson, Eureka’s president and CEO, stated: “We are pleased to enter into this letter of intent. We remain committed to our highly prospective assets in the Nunavik region of Quebec, however, this new acquisition balances out the company’s project portfolio with a lithium project that can be drilled during the winter months, has good access and infrastructure, and is road accessible, drill ready and drill permitted, and is situated in a mining-friendly and active lithium district. Prior work at Lac La Motte includes significant pegmatite showings and reported spodumene, as well as encouraging prior drill intercepts, including drill hole MD22-08 which intersected two pegmatites: upper 1.33 metres wide with 1.49% Li2O [lithium oxide] at 36 metres depth; and lower 0.93 metres wide at 0.88% Li2O at 41.2 metres depth. Upon satisfaction of the due-diligence period and completion of the definitive agreement, Eureka’s will be positioned with data, field crews and access to a drill to immediately commence work.”
Under the Letter of Intent, Eureka will have 30 days to conduct due diligence with a view to negotiating and entering into a definitive agreement with the Optionor under which it would acquire the Option to acquire a 100% undivided interest in and to the property, subject to the NSR, by satisfying each of the following conditions: issuing to the Optionor 200,000 common shares of Eureka on the effective date of the Definitive Agreement; Incurring exploration expenses in respect of the Property totalling $500,000 by 12 months from the Effective Date.
Paying, on behalf of the Optionor, $45,000 in cash to the underlying owner of the property by May 6, 2024; issuing to the Optionor 300,000 Common Shares within 12 months from the Effective Date; incurring additional exploration expenses totalling $500,000 by the date that is 24 months from the Effective Date; paying, on behalf of the Optionor, $50,000 in cash to the Underlying Owner by May 6, 2025; and issuing to the Optionor 1,000,000 Common Shares within 24 months from the Effective Date.
The Letter of Intent is non-binding, except for provisions relating to the exclusive period of dealing and the right of Eureka to conduct a due diligence review, as well as certain other customary provisions.
The Lac La Motte Property is located 40 km northwest of Val-d’Or. There are several active lithium prospects and mines at various stages of exploration and development located approximately 5 km to 20 km from the property.
Recent Highlights from 2022 Drill Program: Drill Hole MD22-02 intersected a 0.7-metre wide pegmatite with 0.89% lithium oxide (Li2O) at 72.7 m drilled depth.
Drill Hole MD22-05 intersected three pegmatites: top 0.79-metre wide with 1.34% Li2O at 13.18 metres depth; middle 0.7-metre wide with 0.5% Li2O at 20 metres depth; lower 0.81-metre wide at 0.78% Li2O at 22.92 metres depth.
Drill Hole MD22-06 intersected three pegmatites: top 0.11-metre wide with 1.10% Li2O at 31.95 metres depth; middle 0.87-metre wide with 1.01% Li2O at 34.53 metres depth; lower 0.80-metres wide at 0.55% Li2O at 37.58 metres depth.
Drill Hole MD22-07 Intersected 1.76-metre wide pegmatite with average 4,375 ppm Li/0.94% Li2O. Drill Hole MD22-08 intersected two pegmatites: Upper 1.33-metre wide with 1.49% Li2O at 36 metres depth; and lower 0.93-metre wide at 0.88% Li2O at 41.2 metres depth.
Eureka Lithium is the largest lithium-focused landowner in the northern third of Quebec, known as the Nunavik region, with 100% ownership of three projects comprising 1,408 km2 in the emerging Raglan West, Raglan South and New Leaf Lithium Camps. These claims were acquired from legendary prospector Shawn Ryan and are located in a region that hosts two operating nickel mines with deep-sea port access.
