{kanada_flagge}Gold explorer A.I.S. Resources Limited (TSXV: AIS; FRA: 8AS) and lithium explorer Spey Resources Corp. (CSE: SPEY; FRA: 2JS) plan to align their interests even more closely in the future than they already have.
Recently A.I.S. Resources, which has a long history as a lithium explorer in Argentina, had granted Spey Resources an 80/20 earn-in for the Incuahasi Salar in Argentina’s Salta province through a private third-party company. Spey can fully acquire the remaining 20 percent owned by A.I.S. by March 2023 for a payment of US$6 million. Now A.I.S. Resources and Spey are going one better: as A.I.S. Resources announced today, the company has entered into another Option Agreement with Spey Resources Corp. to acquire a 100 percent interest in the Pocitos I and Pocitos II claims in Salta, Argentina.
Pursuant to the Option Agreement, A.I.S. in turn has the option (the “Underlying Option”) to acquire the Pocitos I and Pocitos II properties from the current owners. Upon the exercise of the Underlying Option by A.I.S., Spey may then exercise its new Option and acquire a 100% interest in the Property from A.I.S. by paying a total of US$1,732,000 if purchased price prior to June 23, 2022.
To maintain the Option under the agreement, Spey must immediately pay A.I.S. an aggregate of US$100,000 and issue 2,500,000 Spey common shares (current value approximately C$1.3 million). In addition, Spey must complete a US$500,000 exploration program on the property within the next 12 months. Upon exercise of the Option and Spey’s acquisition of a 100% interest in the property, A.I.S. will retain a 7.5% royalty on the sale proceeds of lithium carbonate or other lithium compounds from the property, net of export taxes.
Spey Resources plans to develop both the Incahuasi Salar and the Pocitos I and Pocitos II Salars using new lithium extraction technology developed by private Australian company Ekosolve, in which A.I.S. CEO Phillip Thomas holds shares.
A.I.S. Resources announces financing
Concurrent with the granting of the new Option to Spey, A.I.S. Resources announces a non-brokered private placement for gross proceeds of C$800,000. The placement is to be made at C$0.08. Proceeds will be used for general working capital and exploration of the company’s gold projects in Australia. Each unit will consist of one common share and one transferable share purchase warrant which entitles the holder to purchase one additional common share for a period of 24 months from the closing date of the Offering at a price of C$0.12 per common share.
Pocitos I and II
The project is located approximately 10 km from the community of Pocitos in mining friendly Salta Province, Argentina where gas, electricity and telephone internet services are available. Pocitos I is 800 Ha and Pocitos II is 532 Ha, and both are accessible by road. A.I.S. Resources has spent more than US$1.5 million on exploration of the project, including surface sampling, trenching, TEM geophysics, and two 400-m drill holes that produced excellent results. To date, Pocitos II has not been drilled; the locations for holes 3 and 4 have been identified.
Fig. 1. Pocitos I and II are located in the Quinos Salar, Salta Province in the Lithium Triangle in Argentina.
AIS did not pursue the property in 2018 because the brine has a high magnesium content and this cannot be processed using the conventional crystallization/ion exchange process. However, the Ekosolve™ lithium extraction process is expected to help mitigate the magnesium problem. Lithium levels of up to 125 ppm were recorded and the well flow rate exceeded a healthy 75,000 liters per minute and continued for more than 5 hours. Both holes had exceptional brine flow rates. Spey’s plan is to sample the current holes and drill two additional holes to complete a NI 43-101 resource calculation and advance discussions to build a production pilot plant.
CEO and Director Nader Vatanchi said, “Working with AIS and their team in Argentina has been very productive and we are fortunate that they have access to these projects to expand our lithium portfolio. Spey remains focused on advancing the Incahuasi exploration program, and aims to drill this summer now that we have the results of our geophysical surveys. Our new properties announced today, Pocitos I and II, are at an advanced stage and we look forward to drilling and completing a NI 43-101 report so we can begin planning for potential production.”
Martyn Element, Chairman of AIS, stated, “We are pleased that our solid working relationship between AIS Resources and Spey Resources extends to the Pocitos 1 and 2 properties. Importantly, the proprietary Ekosolve™ lithium extraction process is helping to alleviate the magnesium extraction problem, which is key to enhancing the lithium value of Pocitos 1 & 2.”
Bottom line: this is how smart business is done! A.I.S. Resources immediately receives US$$100,000 and 2.5 million shares of Spey Resources for its option on two Argentine salars that no longer fit its current focus as a gold explorer in Australia. Within a year, Spey must also pay US$1.7 million as purchase price. In addition, Spey and A.I.S. are still linked via an earn-in deal from Spey into the Incahuasi Salar. Here, A.I.S. can even expect to get paid US$6 million if the option is fully exercised.
In the background of both transactions is the technology of the Australian private company Ekosolve, whose co-founder and major shareholder is A.I.S. CEO Phillip Thomas. Ekosolve’s technology saves huge costs compared to traditional evaporation ponds and promises to be able to productively extract lithium even from magnesium-rich brines, which were previously considered problematic. Ekosolve technology has disruptive potential that extends far beyond individual cases. By partnering with Ekosolve, lithium explorer Spey Resources effectively becomes a bet on the new technology. It will be critical to see how compelling the extraction results are that Ekosolve achieves based on samples from Incahuasi and Pocitos in the future. We are excited.
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In accordance with §34b WpHG and § 48f Abs. 5 BörseG (Austria) we would like to point out that GOLDINVEST Consulting GmbH and/or partners, principals or employees of GOLDINVEST Consulting GmbH hold shares in Spey Resources and AIS Resources and therefore a conflict of interest exists. GOLDINVEST Consulting GmbH also reserves the right to buy or sell shares in the company at any time. Furthermore, a contractual relationship exists between Spey Resources, AIS Resources and GOLDINVEST Consulting GmbH which involves GOLDINVEST Consulting GmbH reporting on Spey Resources and AIS Resources. This is another clear conflict of interest.
