Delta Lithium (ASX:DLI) adds Volt-age to its lithium Reach in the Gascoyne

Delta Lithium has committed to spending $25.2 million or more on farm-in deals with its neighbours Voltaic Strategic Resources and Reach Resources to swell the Chris Ellison-chaired company’s Yinnetharra Lithium Project to a scale with potential to be a long-life lithium operation in Western Australia’s Gascoyne region.

Voltaic entered into a $12 million dollar farm-in deal with Delta while neighbouring and Reach Resources inked a deal in the order of $13 million.

Delta will pay Voltaic an initial $1.25 million and can earn a 51 per cent interest in its Ti Tree project by spending $3 million over two years and can claim 29% more with $6.25 million spent or delivery of a resource estimate exceeding 10 million tonnes at 0.8 per cent lithium oxide within three years.

The move offers Voltaic exposure to the near-term benefits of a busy Delta exploration team, a de-risked pathway to production, and a stocked $7.25 million war chest for accelerated exploration and acquisition moves.

A similar deal for the Morrissey Hill and Camel Hill Lithium Project will pay Reach an initial $3.2 million with a 51% interest at stake if Delta spends $3 million on exploration over two years.

For Delta, it brings its regional landholdings to 1769 square kilometres and consolidated control of the Volta Corridor, an interpreted prospective corridor of lithium-ceasium-tantalum pegmatites which brought the Gascoyne to attention as one of the most enticing lithium frontiers.

Delta Managing Director James Croser said the move simultaneously granted access to expanded prospective stratigraphy to add to existing tenure which has already delivered an impressive maiden resource.

“The combined land package significantly boosts the potential for a long-life lithium operation in the region. Both Voltaic and Reach shareholders are poised to directly benefit from Delta’s existing on-site presence at Yinnetharra and the expertise that our team will apply to our expanded footprint starting immediately,” Croser said.

“With such a dominant footprint in the region, particularly across the highly prospective Leake Springs
metamorphic unit adjacent to the Thirty Three suite granite, this deal increases the likelihood of a regional scale project which all shareholders can now benefit from.”

Voltaic Chief Executive Officer Michael Walshe said that entering a mutually advantageous strategic partnership with its neighbour was an excellent outcome for both companies.

“This enables Voltaic to undertake considered and cost-effective exploration at the Paddys Well and Meekatharra projects and provides a platform to pursue transformative growth opportunities,” he said.

Walshe added that Delta has rapidly advanced Yinnetharra, completing over 115,000 metres of drilling and delivering a maiden resource in just over a year since acquisition.

“This effort is ongoing, with extensive exploration and resource definition drilling programs in progress and very ambitious near-term plans to grow the project into a globally significant lithium resource,” he said.

“This transformative deal positions Voltaic for substantial near-term project development catalysts, and leveraging Delta’s robust balance sheet, offers a significantly de-risked route to production and cashflow.”

Voltaic’s other assets lie in the clay-hosted rare earths and uranium upside of nearby Paddy’s Well and 267 square kilometres of prospective ground in gold-endowed Meekatharra.

The Perth-based explorer is advancing surface reconnaissance at both projects and expects to soon intensify operations with a well-stocked budget.

It is likely there is a Voltaic acquisition on the horizon and, after Stage 2 of the Delta deal at Ti Tree, it can elect to maintain a 20% stake by contributing, or divest its interest for fair market value.

Reach’s focus will now lie on its Wabli Creek Niobium Project, with Chief Executive Officer Jeremy Bower saying that to receive $3.2 million upfront and another $10 million for a successful JORC resource was a great result in difficult market conditions.

“Importantly, we have ensured the final 20 per cent has uncapped upside, with this portion to be negotiated in good faith between Reach and Delta,” he said.

“Combined with our recently announced rights Issue to raise up to about $2 million, and further subject to shareholder approval being obtained to consolidate the capital of the company, Reach will re-emerge with a tight capital structure and over $6 million cash.”

Watch: Voltaic’s Michael Walshe on the agreement with Delta Lithium

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