LSC Lithium Corporation (“
LSC” or
together with its subsidiaries, the “
Company”)
(TSXV:LSC) is pleased to announce it has entered into a joint
venture agreement with Litica Resources, a wholly owned subsidiary
of Pluspetrol S.A., (
“Litica Resources”), a
leading private oil and gas company to enter into a 40/60 joint
venture (“
Joint Venture”) to explore and develop
tenements on the Salar de Arizaro lithium project (“
Arizaro
Project”) in Salta Province, Argentina (the
“
Transaction”).
HIGHLIGHTS
- Litica Resources is a Pluspetrol company, a leading private oil
and gas company, that has selected LSC as its partner for its
initial expansion into lithium.
- Joint Venture will cover 22,376 hectares in the centre of the
Salar de Arizaro, Salta, Argentina.
- Litica Resources will act as operator of the Joint Venture and
intends to commence exploration activities and brine sampling as
soon as possible.
- Completion of an initial resource statement on the Arizaro
Project is anticipated at the end of the three-stage exploration
work program.
Ian Stalker, President & Chief Executive
Officer of LSC, commented, "This joint venture with Litica
Resources is a major accomplishment for LSC. We are delighted to
have reached an agreement and feel certain that the complimentary
skill sets and strong relationship of cooperation between the
parties will lead to many benefits, now and in the future, for the
respective shareholders and stakeholders. We believe this is the
beginning of a lasting partnership with Litica Resources and that
it represents an important step towards lithium production for LSC
while securing financial contribution.”
The parties have agreed to a three-stage
exploration work program for the Arizaro Project whereby Litica
Resources, as operator, will commence sub-surface brine sampling
and geological mapping, complete geophysical surveys and diamond
drill holes and evaluate the brine chemistry with the intention of
completing a maiden resource statement.
Litica Resources has agreed to commit a total of
US$6,868,000 to LSC and the Joint Venture over a three-stage
exploration work program to maintain its 60% ownership including an
initial lump-sum payment of US$625,000 to LSC on closing of the
Transaction.
Terms of the Transaction
On July 27, 2018, LSC and Litica Resources
entered into a Joint Venture Agreement, Shareholders’ Agreement and
Operating Agreement (the “Definitive Agreements”)
pursuant to which: (i) Litica Resources will pay LSC an initial
cash payment of US$625,000; (ii) LSC will contribute 22,376
hectares that it controls in the Salar de Arizaro into a newly
formed Joint Venture company; and (iii) 40% of the Joint Venture
corporation will be owned by LSC and 60% will be owned by Litica
Resources. The parties also agreed that Litica Resources will
be the operator of the Arizaro Project and Litica Resources will
hold the majority of the seats on the Board of Directors of the
Joint Venture company.
The parties have agreed to a three-stage
exploration work program for the Arizaro Project whereby has Litica
Resources committed to spend a total of US$6,868,000 to maintain
its 60% ownership in the Joint Venture. In the first and
second phase of the work program, Litica Resources has committed to
spend US$1,600,000 and US$2,500,000, respectively. In the
third phase, Litica Resources has agreed to pay LSC US$625,000 and
to spend US$1,518,000 on the Arizaro Project. In the third phase of
work, LSC has committed to spending US$1,012,000 on the Arizaro
Project. Following completion of the initial exploration work
program, the parties will contribute to the Joint Venture on a
pro-rata basis.
If Litica Resources decides at any point to not
enter into the next work program, at LSC's sole option, Litica
Resources will either: (i) pay to LSC the remainder of the
outstanding expenditures committed to the Arizaro Project to
maintain Litica Resources 60% ownership; or (ii) Litica Resources
percentage ownership will be reduced based on the remainder of
commitment outstanding.
Closing of the Transaction is expected to take
place no later than ninety-days following a thirty-day due
diligence period, which may be extended through an agreement by the
parties.
ABOUT PLUSPETROL:
Pluspetrol is a private, independent,
international company with over 40 years of experience in the
exploration and production of oil and gas. Present in Angola,
Argentina, Bolivia, Colombia, Netherlands, Peru, United States,
Uruguay and Venezuela, Pluspetrol promotes energy development and
fosters activities at an international level. Pluspetrol is a
leader in the operation of high-pressure gas fields and the
extraction of oil in mature fields with secondary and tertiary
recovery. With a view to the future, the company is making
significant investments in Argentina, and it is particularly
well-positioned at the Vaca Muerta formation, one of the largest
unconventional oil and gas reservoirs.
ABOUT LSC LITHIUM
CORPORATION:
LSC Lithium has amassed a large portfolio of
prospective lithium rich salars and is focused on developing its
material projects: Pozuelos and Pastos Grandes Project, Rio Grande
and Salinas Grandes. All LSC tenements are located in the “Lithium
Triangle,” an area at the intersection of Argentina, Bolivia, and
Chile where the world’s most abundant lithium brine deposits are
found. LSC Lithium has a land package portfolio totaling
approximately 300,000 hectares, which represents extensive lithium
prospective salar holdings in Argentina.
For further information please
contact:
LSC Lithium Corporation Ian StalkerPresident
& Chief Executive Officer40 University Avenue, Suite 605Toronto
ON, Canada M5J 1T1(416) 304 9384Email: info@lsclithium.comWeb:
lsclithium.com
Forward-Looking Statements
Certain statements contained in this news
release constitute forward-looking information. These statements
relate to future events or future performance, including statements
regarding the timing for commencing exploration on the Arizaro
Project, timing and completion of the due diligence period, timing
and likelihood of completing the closing of the Transaction, timing
and ability to complete a maiden resource statement on the Arizaro
Project, ability to obtain any regulatory approvals, if applicable,
ability and timing to complete the work-program, results and
outcome of the work program on the Arizaro Project, ability of both
LSC and Pluspetrol to fund the Joint Venture and ongoing
relationship with Pluspetrol. The use of any of the words “could”,
“intend”, “expect”, “believe”, “will”, “projected”, “estimated” and
similar expressions and statements relating to matters that are not
historical facts are intended to identify forward-looking
information and are based on LSC’s current belief or assumptions as
to the outcome and timing of such future events. Whether actual
results and developments will conform with LSC’s expectations is
subject to a number of risks and uncertainties including factors
underlying management’s assumptions, including risks related to:
title, permitting and regulatory risks; exploration and the
establishment of any resources or reserves on the Arizaro Project
or other LSC properties; volatility in lithium prices and the
market for lithium; exchange rate fluctuations; volatility in LSC's
share price; the requirement for significant additional funds for
development that may not be available; changes in national and
local government legislation, including permitting and licensing
regimes and taxation policies and the enforcement thereof;
regulatory, political or economic developments
in Argentina or elsewhere; litigation; title, permit or
license disputes related to interests on any of the properties in
which the Company holds an interest; excessive cost escalation as
well as development, permitting, infrastructure, operating or
technical difficulties on any of the Company's properties; risks
and hazards associated with the business of development and mining
on any of the Company's properties, the ability to the Company to
raise funds to carry on its operations, the ability of the Company
to advance its projects, future demand of lithium as a critical
commodity, and the outcome of the closing of the Transaction.
Actual future results may differ materially. The forward-looking
information contained in this release is made as of the date hereof
and LSC is not obligated to update or revise any forward-looking
information, whether as a result of new information, future events
or otherwise, except as required by applicable securities laws.
Because of the risks, uncertainties and assumptions contained
herein, investors should not place undue reliance on
forward-looking information. The foregoing statements expressly
qualify any forward-looking information contained herein. For more
information see the Company’s filing statement on SEDAR at
www.sedar.com.
Neither the TSX Venture Exchange Inc. nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
The TSX Venture Exchange Inc. has neither
approved nor disapproved the contents of this press release.
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