Calidus Resources (ASX: CAI) has welcomed the news that international lithium major SQM is set to provide significant new funding to advance the Pirra lithium project in Western Australia.
SQM, one of the largest producers of lithium carbonate in the world, is acquiring a 30% interest in the Pirra project operator, Pirra Lithium Ltd, from project partner Haoma.
By providing $3 million in new funding for the Pirra project, SQM will increase its total stake in Pirra Lithium to 40%.
The proceeds from SQM’s investment will be used to fund exploration expenditure on Pirra’s projects and for the company’s general working capital.
Calidus has also entered into a commitment letter with Pirra where it will subscribe for $2 million of Pirra shares following completion of the new SQM deal.
Growing lithium footprint
Calidus managing director Dave Reeves also confirmed that the size of the Pirra project footprint in the East Pilbara has been expanded with Pirra Lithium agreeing to acquire a further 348 sq km of lithium rights from Haoma.
These additional tenements will be added to the existing lithium rights sharing agreements between Pirra and Haoma unveiled in February 2022.
“SQM’s acquisition of a large stake in Pirra is a big vote of confidence in the prospectivity of the company’s lithium exploration acreage in the Pilbara,” Mr Reeves said.
“With an increased landholding of over 1,411 square kilometres in the Pilbara, Pirra is now funded to rapidly progress exploration across these tenements. An initial focus will be the Tabba Tabba South tenements which lie immediately along strike from known lithium occurrences and on a belt that hosts significant lithium resources.”
Mr Reeves said Calidus will maintain its position in Pirra at 40% due to the significant potential of the land package, but the company will re-assess its options as exploration continues.
Exploration program underway
Pirra has now commenced mapping and sampling of priority lithium targets including the Tabba Tabba South tenement in the West Pilbara, along strike from Wildcat Resources’ recently announced major new discovery.
The Tabba Tabba Shear hosts the recent discovery of extensive lithium pegmatites made by Wildcat Resources, with a known lithium pegmatite 400m from the boundary of the Pirra tenement. It is also in close proximity to the identified lithium mineral resource reportedly located on Fortescue Metals Group ground.
Mr Reeves said these lithium deposits highlight the potential of Pirra’s Tabba Tabba South tenement, which straddles nearly 8km of strike length of the Tabba Tabba Shear and is a priority target for Pirra.
Pirra will commence a mapping programme to identify which areas are initially amenable to soil sampling and which areas of thicker cover will require augering and drilling.
SQM will assist Pirra’s exploration campaign by being part of a technical committee that will have oversight of the proposed exploration programme and budgets.