Pinnacle Minerals Ltd (ASX: PIM) has unveiled a strategic acquisition, partnering with Waratah Capital Advisors Ltd (Waratah) to secure a 75 percent interest in the Adina East Lithium Project situated in Quebec’s James Bay lithium district, marking a crucial step forward for Pinnacle with the potential for significant lithium and gold discoveries in this promising region.
The Adina East Lithium Project boasts a vast expanse of 72.7 square kilometres in the James Bay region, a hotbed for lithium exploration and mining. Positioned a mere 24 kilometres from Winsome Resources’ Adina Project, the Adina East Project’s strategic location is further underscored by its proximity to the Loyal Lithium Trieste Project and Winsome Resources’ Tilly Project.
Figure 1: Adina East Claims Highlighting Bedrock Geology and Location Relative to other Key Projects
The deal comes with additional benefits: in exchange for a $500,000 offtake pre-payment, Pinnacle Minerals will grant the vendor, Electrification and Decarbonisation AIE LP, the right to purchase 25 percent of all minerals extracted from the Adina East Project.
This innovative payment structure not only helps fund the transaction but also infuses Pinnacle Minerals with additional capital, reinforcing its financial position and minimising the need for dilutive capital raises.
Strategic Partnerships and Expansion
Pinnacle Minerals’ strategic collaboration with Waratah’s Electrification and Decarbonisation AIE LP fund is expected to extend the Company’s reach beyond Quebec.
With Waratah managing over $4 billion CAD in assets, this partnership offers Pinnacle Minerals a wealth of expertise and resources to bolster its presence in the critical minerals market.
Additionally, the involvement of Lithium Royalty Corp. in this acquisition further solidifies the Project’s potential.
Lithium Royalty Corp. holds a 2.0 percent gross revenue royalty on the Adina East Project, and it is also associated with other promising projects in various stages of development. This collaboration adds another layer of industry expertise to Pinnacle Minerals’ lithium endeavours.
Promising Geological Indicators
The geological and structural characteristics of the Adina East Project are highly promising for potential lithium and gold discoveries.
Situated on the border of the interpreted extension of the Trieste Greenstone Belt, the Project’s geology offers an ideal environment for mineral exploration.
The Project’s extensive history of pegmatite occurrences and the presence of potential lithium-bearing minerals identified through detailed satellite and radar analysis further strengthen its prospects.
Figure 2: Adina East Project with identified pegmatite targets
In tandem with this transformative acquisition, Mr. Bill Witham, a highly respected figure in the lithium exploration space, is taking on the role of Executive Chairman for Pinnacle Minerals.
His expertise, honed through his role as the founding director and technical manager of Electrostate Limited, positions him as an invaluable asset in driving the exploration effort.
His prior experience as the Managing Director of Galaxy Resources, now Allkem, one of the world’s largest lithium producers, further solidifies his status as a leader in the lithium industry.
Exploration Plans and Timeline
Pinnacle Minerals has laid out a comprehensive plan for the Adina East Project, which encompasses a series of exploration activities to unlock its full potential.
These activities include rock chip sampling, field mapping, and diamond and RC drilling of lithium targets, with drilling expected to commence in the fourth quarter of 2024.
Pinnacle Minerals Managing Director Nic Matich said the acquisition not only provides an exceptional lithium exploration opportunity for Pinnacle Minerals, but brings with it a partnership with Waratah and Lithium Royalty Corp.
“This partnership is anticipated to allow Pinnacle to expand and grow the Company’s critical mineral portfolio further,” he said.
“Preselling a 25 percent offtake for US $500,000 shows the ‘offtakers’ confidence in the Project and bolsters our cash reserves in a climate where the dilutive effect of raising capital is destructive to junior explorers.
“Lithium Royalty Corp. has royalties in 32 projects globally highlighting its global expertise in the sector.”
Pinnacle Minerals latest corporate presentation can be found here.
PIM’s Australian Stock Exchange-listed share price has risen 44.44% today and is currently trading at $0.13 (9:45am UTC+ 8 hours).