Hexagon Energy Materials Ltd (ASX: HXG) has signed a Binding Terms Sheet Earn-In Agreement with Green Critical Minerals Pty Ltd that will bring cash and exploration funding to the McIntosh Project’s Graphite resources and leverage off past investment from Hexagon.
A total of A$500,000 cash (A$300,000 on listing of the farm-in entity +A $200,000 on the first anniversary of listing) is to be paid to Hexagon and $3,000,000 of exploration expenditure over four years is to be invested by Green Critical Minerals to secure 80% of the Graphite mineral rights at the McIntosh Project.
McIntosh Project
Hexagon holds 17 tenements covering 542 sq. km of ground in the East Kimberley of Western Australia known as the McIntosh Project. Between 2015 and 2019 Hexagon (initially as Lamboo Resources Limited which subsequently became Hexagon) focused solely on Graphite project development. Substantial drilling programmes, metallurgical test work programs, market analysis and project commercial analysis were completed over this period.
Green Critical Minerals will continue this work and plans to further progress it through its highly experienced Graphite team. Hexagon will remain tenement owner and focus on exploring for Ni-Cu-PGEs at McIntosh.
“This deal delivers against Hexagon’s Future Energy Materials value creation strategy. Hexagon will benefit from additional cash and additional exploration expenditure at McIntosh, while we simultaneously focus on developing the Ni-Cu-PGE potential there is at McIntosh,” Hexagon’s Managing Director, Merrill Gray, said.
“We look forward to working collaboratively with the Green Critical Minerals team, sharing information and on ground resources and building substantial value off past Hexagon investment in Graphite.”
Mr Gray said Hexagon’s goal is to participate in the large, global, Future Energy and Future Energy Materials markets. The global requirement for cleaner energy solutions, driven by climate change, has accelerated.
New commitments to emissions targets are being made by individuals, communities, corporations and governments. These targets are driving innovation and the adoption of new, sustainable sources of energy that lower climate change impacts and are triggering investment in supporting technologies.
This is having flow on effects across the raw material inputs/supply chains feeding into these new supporting technologies, across Nickel, Copper, Graphite, PGEs and Lithium.
Hexagon holds a highly prospective portfolio of assets/projects in Future Energy Materials, namely Graphite, Nickel, Copper and PGEs, that are well positioned for development, and which have been progressed via systematic geophysical, geochemical and structural geology re-interpretation work and for Graphite drilling and metallurgical testing, completed over several years.
Hexagon undertook a detailed strategic review of the Company’s asset portfolio in 2021 which defined a clear strategy for growth. Key to this is the creation of value by securing and leveraging technical and commercial alliances by commodity.
By doing this, Hexagon will bring additional expertise and funds into the company’s existing asset base, while allowing Hexagon management to focus on its core projects.
This binding Graphite mineral rights only Earn-in Agreement for McIntosh allows Hexagon to realise value through the existing Graphite resources while it progresses its planned 2022 Nickel, Copper and PGE drilling at McIntosh, building on the substantial historic and past exploration work.
Green Critical Minerals will seek to create value from the Graphite resource already established at McIntosh by expanding these resources for use in lithium battery manufacture.
Over the past 18 months, Hexagon has undertaken a detailed review of all past McIntosh data and analysis focussing on Ni-Cu-PGEs. Sulphide mineral intersections had previously been recorded at the McIntosh Project during drilling for Graphite but had not been analysed for Ni-Cu-PGEs due to the focus on Graphite.
Past McIntosh drill core being held in Hexagon’s warehouse has now been retrieved, resampled and sent for analysed for Ni-Cu-PGE. As set out in Hexagon’s 2 February 2022 McIntosh Update ASX announcement, in addition, an historical drill intersection of PGE mineralisation within mapped Panton Suite of 20 m @ 0.75 g/t 3PGE plus other intersections were found during recent further interrogation of historical data.
Furthermore, the initial Ni-Cu-PGE interpretation of the around 5,200 soil samples collected during the 2021 field season has now been completed by Dr Dennis Arne, Director of Telemark Geosciences, with final interpretations expected to lead to further market updates shortly.
The Hexagon team, as a result of all of these developments, is on track to further refine its McIntosh Project 2022 field season work plans which include more granular geophysics and drilling. Negotiations are underway with established ASX listed gold companies who hold ground near Hexagon’s Halls Creek ground holdings in Western Australia in relation to a similar Earn In agreement on Hexagon’s Halls Creek project.
For further information please visit: https://hxgenergymaterials.com.au/
