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Ragnar Metals Acquires Orrvik Lithium Project in Sweden

12 October 2023 14:44
ASX: RAG

Ragnar Metals Limited (ASX:RAG) has entered into an agreement with Pallas Metals AB, a Canadian exploration company, to acquire four exploration licences in Sweden.

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Figure 1: Simplified geological map of Scandinavia showing the location of Ragnar’s new Lithium Projects as well as new Orrvik Project acquisition

The Orrvik Project

The acquisition of the Orrvik Project, encompassing 36 square kilometres and closely positioned to the burgeoning European lithium market, strategically expands the Company’s existing European lithium portfolio to 168 square kilometres.

Notably, the Orrvik Project is located in an area with high prospects for spodumene-bearing, LCT-pegmatite-type lithium deposits. Moreover, it shares contiguous boundaries with Ragnar’s existing Bergom Project, thus effectively enhancing the overall portfolio and further strengthening the Company’s position in the lithium market.

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Figure 2: Interpreted bedrock geology map in the Bergom area showing Ragnar’s existing tenure and the location of the recent Orrvik project acquisition

The Project has noteworthy spodumene occurrences, particularly at Orrvik, where shallow drilling assays have yielded up to 3.3% Li2O, and at Stenback, with rock assays reaching up to 2.8% Li2O. Historic drilling conducted within the Project area suggests that lithium mineralisation exceeding 1.0% Li2O remains open to exploration in both the southwest and northeast directions.

Yet, Ragnar acknowledges that despite these promising findings, there has been a lack of subsequent exploration efforts, with only partial and sporadic auger base-of-till and bedrock assays carried out in the vicinity of Orrvik.

Consequently, the Project has remained largely dormant for an extended period, with approximately 32 square kilometres of the tenure remaining unexplored.

Additional Exploration License’s

Through its acquisition in early August, Ragnar Metals has obtained additional exploration licenses for two highly prospective lithium projects in Sweden, encompassing Bergom and Hälleberget, and has initiated an extensive exploration program targeting potential lithium resources within multiple outcropping pegmatites across both project areas.

Ragnar has applied for additional exploration licenses to extend the area of its Projects, totalling 168 square kilometres. These projects are considered promising for lithium pegmatite deposits, as they are located within a district believed to be an extension of the same geological belt containing Scandinavia’s largest lithium deposits.

The Acquisition Agreement

The acquisition agreement between Ragnar and Pallas Metals includes an initial cash payment of $50,000, to be made within 10 business days of executing the agreement. Additionally, upon completion of the acquisition, Ragnar will make a cash payment of $450,000.

As part of the sale terms, Ragnar has agreed to pay Pallas a Net Smelter Return royalty of 1.5% on all mineral or metallic products extracted from the area covered by the Orrvik licenses.

However, Ragnar has the option to purchase a portion or the entirety of the royalty back by making payments of $750,000 to reduce the royalty percentage to 0.75% and a further $1,000,000 to eliminate the royalty entirely.

Future Outlook and Planned Exploration

Ragnar has already conducted rock sampling programs as part of the due diligence process for the Orrvik Project, involving the collection of 17 samples, the results of which are currently pending.

Additionally, the Company has carried out a comprehensive two-week rock sampling program across the Hälleberget and Bergom Project areas.

Ragnar has also outlined plans for additional work programs aimed at defining drill targets. These programs include orientation surface sampling to determine the most effective method for identifying lithium anomalies below the surface, further rock sampling to enhance the existing pegmatite assay database, detailed airborne (drone) magnetic surveys to delineate critical structures and intruding pegmatite formations, as well as a comprehensive airborne multi-spectral survey to enhance the identification of potential targets.

Ragnar Metals Limited’s Executive Director Eddie King commented on the acquisition.

“We are thrilled by the opportunity to acquire Orrvik to expand our significant ground position in Sweden with a new flagship project that has confirmed spodumene mineralisation at surface,” he said.

“Interestingly, the two spodumene occurrences at surface are 5 kilometres apart, highlighting the fantastic potential for the area to host further spodumene (lithium) bearing pegmatite mineralisation.”

“On completion, this acquisition will solidify our focus on European critical minerals and we aim to target new discoveries in the next 12 months of exploration.”

RAG’s Australian Stock Exchange-listed share price is currently trading at $0.023 today (2:45pm UTC+ 8 hours).

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