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Home > News > ALX Resources closes...

ALX Resources closes transaction with Forrestania on Hydra Lithium Project in NW Quebec

Jul 10, 2023


"ALX is pleased to launch this partnership at Hydra with Forrestania," said Warren Stanyer, CEO and Chairman of ALX. "We look forward to jointly resuming our lithium exploration in the James Bay region as soon as weather and forest fire conditions allow."

ALX Resources Corp.  announced that it has closed a transaction with Forrestania Resources Limited, of West Perth, Australia ("Forrestania") (ASX: FRS) whereby Forrestania has exercised its option (see ALX news release dated May 8, 2023) and has earned a 50% interest in the Hydra Lithium Project ("Hydra", or the "Project"). Hydra is located in the James Bay region in the Province of Quebec, Canada, which has become one of the most attractive lithium exploration districts in the world. 

Details of the Transaction 

ALX acquired eight Hydra sub-projects by staking in late 2022 and early 2023. Following closing of the transaction on July 7, 2023, the Company and Forrestania now each own a 50% interest in the Project. Staking and exploration costs incurred by ALX to the end of the 2023 field season are projected to total CAD $900,000. The following terms provided for Forrestania to essentially match ALX's staking and exploration commitment. To earn its 50% interest in Hydra, Forrestania has paid to ALX: 

  • CAD $400,000 in cash, which includes an initial $50,000 non-refundable deposit; and
  • CAD $600,000 in Forrestania common shares (the "Shares") totaling 4,579,586 Shares based on an AUD:CAD exchange rate of 0.881 and the 10-day volume weighted average price of Forrestania (AUD$0.1486 per share) up to the day prior to the closing date of the transaction.

On July 6, 2023, Forrestania held an Extraordinary General Meeting and received shareholder approval for the issuance of the Shares required to close the transaction. The newly-formed 50:50 joint venture (the "Hydra JV") will explore and administer the Project, with ALX acting as operator in exchange for an industry-standard administration fee. ALX and Forrestania will each vest with a 1.50% net smelter returns royalty.

 



Tags: Quebec / Deals & Financial / Battery Metals / All Articles