ASX lithium and gold junior announces further Canadian expansion

Midas Minerals (ASX: MM1) announced a further expansion of its Canadian operations through a non-binding agreement with Gold Terra Resources Corp (TSXV:YGT). This follows Midas’ recent acquisition of the Greenbush lithium project in Ontario, Canada.

The non-binding agreement with Gold Terra will see Midas earn 80% of critical minerals rights over Gold Terra’s Yellowknife project (YLP) in Northwest Territories Canada. This specifically includes pegmatite lithium and associated minerals and rare earths for 108 claims across 544 sq km.

“The proposed Yellowknife Lithium Project represents an excellent opportunity for Midas to access a large project prospective for LCT pegmatites in a region known to contain numerous spodumene pegmatites,” said Mark Calderwood, Midas managing director.

Midas expects to commence exploration in June 2023 and have targets for drilling by August 2023.

Why the Goldknife project?

Gold Terra’s Yellowknife Project covers approximately 60km strike of the western portion of the Prosperous Granite and Pegmatite Suite and is one of the largest tenement holdings in the region. The region has had numerous lithium and tantalum occurrences, along with being known for gold exploration.

The presence of pegmatites is a significant factor here. Spodumene is a common constituent of many Lithium-Cesium-Tantalum (LCT) pegmatites found in the region. Spodumene has a theoretical 8.03% lithium content - one of the highest concentrations (Source: SGS Minerals Services).

There are several other explorers present in the region including Li-FT Power Ltd (CSE: LIFT) and Patriot Battery Metals Inc (ASX:PMT).

The YLP has extensive exploration data including detailed airborne magnetics and radiometrics, LiDAR (light detection and ranging)and high-resolution aerial imagery. The agreement with Gold Terra provides Midas with access to this, which will assist in identifying target areas for lithium exploration.

Gold Terra had acquired the tenement for its own gold exploration and has not previously assayed for lithium, caesium or tantalum on samples collected during gold exploration.

Key infrastructure

Yellowknife is a services hub for numerous mines in the region and was founded in 1934 as a gold mining capital. It has a hydroelectric power supply along with all-season and winter roads.

The Yellowknife airport is responsible for substantial annual traffic, including 400,000 passengers and 30,000 tonnes of cargo, considered the busiest airport in northern Canada. There is also access to the railway by barge across the Great Slave Lake.

These factors are supportive of exploration and drilling activity in the region.

The terms of agreement

At this stage, Midas’ agreement with Gold Terra is non-binding, with plans to negotiate on terms for a full agreement by 25 April 2023.

It has two stages.

Stage 1 involves an earn in of 51% in the critical mineral rights through a series of payments totalling C$1.15million, issuance of 2.2 million shares to Gold Terra and incurring exploration and development expenditure of $5 million in stages to end September 2026.

Stage 2 allows Midas to earn a further 29% interest (bringing the total to 80%) by spending an addition C$5million on exploration and/or development of YLP by 30 September 2028.

Ongoing expansion for Midas

If the non-binding agreement is completed, it will bring the total project areas for Midas across Australia and Canada to 2,192 sq km.

Disclaimer: Market Index helps small-cap ASX-listed companies connect with Australian investors through clear and concise articles on key developments. Midas Minerals was a client at the time of publishing. All coverage contains factual information only and should not be interpreted as an opinion or financial advice.