Lithium explorer and developer Winsome Resources (ASX: WR1) announced Thursday the signing of an option agreement to expand its Adina lithium project in Quebec to 44 sq. km, a 50% increase, as it prepares for an initial resource this year.
The agreement would allow Winsome to acquire the 29 claims in the bordering Jackpot property and expand its total tenure in the James Bay area to more than 871.5 sq. km, the Perth-headquartered firm said in a release.
“With Adina moving into a development phase later this year, taking an option on attractive terms over the Jackpot property is a strategic move to not only give us access to further exploration upside around Adina but also flexibility in future design of site layout and infrastructure footprints,” said Winsome managing director Chris Evans. “Work continues apace with plans for mobilization of the fourth rig to the Adina site and we look forward to further drilling results in the near future as we look towards our maiden resource later in 2023.”
Cores from the Adina project. Credit: Winsome Resources
Winsome plans to define targets for field exploration at Jackpot this summer and is currently compiling publicly available geological data. Jackpot covers 14.9 sq. km and is located immediately north of Adina and 300 km east of James Bay.
Under the option agreement, Winsome will pay $150,000 in cash and 250,000 shares to Andrew Sostad and Christopher Sostad, who own the Jackpot property, and give the same in cash and shares up to one year after the agreement is made. Winsome will also incur $150,000 in exploration work at Jackpot a year after signing the deal.
Winsome will issue the optioners 100,000 additional shares if, within 24 months of exercising the option, it collects five or more rock chip samples containing at least 1% lithium oxide (Li2O) from sites at least 100 metres apart at Jackpot. The same will apply if the company completes a drill program and intersects at least 5 metres at more than 1% Li2O in three or more holes.
Finally, if the option is exercised, the optioners will retain a 2% net smelter returns royalty over any commercial production from the project. Winsome maintains the right to buy half of the royalty for $1 million at any time.
According to drill results released in May, the company has identified a new lithium-bearing pegmatite dyke swarm at Adina, with high-grade intersections from the Main Zone, including 18.7 metres grading 2.25% Li2O from 43.3 metres depth and 10 metres grading 2.09% Li2O from 35.2 metres depth.
Assays released in early April show mineralization from drilling undertaken in 2018 by MetalsTech at Adina 1 to the Adina main zone to Adina east, with the strike open east and west.
And in results released in January, highlights included 107.6 metres grading 1.34% Li2O starting from 2.3 metres, including 30 metres grading 2.21% Li2O from 41 metres.
Jackpot is mainly underlain by the Joubert Suite of intrusive tonalities and granodiorites, according to geological analysis by Quebec’s Department of Energy and Natural Resources. The suite intrudes the nearby greenstones of the Trieste Formation that hosts the lithium-bearing pegmatites at Adina.
Winsome said its geological research had demonstrated the potential for contact with the greenstone belt to be further north, near the boundary between Adina and the Jackpot property. The intersection of mineralized pegmatites under the Adina main zone also could indicate other pegmatite swarms north of Adina.
The company’s portfolio includes four other projects in Quebec: Cancet and Sirmac-Clappier in the James Bay region, and Decelles and Mazarac near Val-d’Or.
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