Vancouver-based Saga Metals and Rio Tinto Exploration Canada have worked out an option and potential joint venture for Saga’s Legacy lithium project in Eeyou Istchee James Bay, in northern Quebec.
Under the option agreement, Rio Tinto can acquire an initial 51% interest in Legacy over a period of four years. A cash payment of C$410,190 will be made to Saga on or before August 11, 2024. It will then spend approximately C$9.6 million during the four years, including C$1.7 million in the first 20 months of the agreement. Payments of C$68,365 per year (C$273,460 in total) will be made to Saga and an additional C$225,000 to the property vendors, an amount owned by Saga.
Rio can earn an extra 25% in Legacy, bringing its interest to 75% over the following five years after the initial four years. The company will have t o spend approximately C$34.2 million at the project during the five-year period.
Rio Tinto Exploration will act as operator with the advice of a technical committee made up of members from each partner.
“This marks a significant milestone in the company’s development and creates a non-dilutive pathway for the necessary capital to properly explore our Legacy lithium project over the coming years,” states Mike Stier, CEO and director of Saga. “We look forward to partnering with Rio Tinto and hope to have a long and fruitful relationship for many years to come.”
The Legacy property covers 342.43 sq. km. in what Saga says is an underexplored area known to contain LCT-bearing pegmatitic lithium showings. It lies within Quebec’s Plan du Nord, where the province proposes to develop northern infrastructure.
This year, the Legacy property will see the establishment of a base camp, lithological and structural geological mapping, and a suite of geophysical surveys, high-resolution imaging and spectral analysis.
Saga also controls the Radar vanadium and Double Mer uranium properties in eastern Labrador, and the North Wind iron ore property in west-central Labrador.
