VANCOUVER, BC, Jan. 14,
2025 /CNW/ -- Lithium South Development
Corporation (the "Company" or "Lithium South") (TSX-V:
LIS) (OTCQB: LISMF) (Frankfurt: OGPQ) is pleased to announce the
signing of a Letter of Intent ("LOI")( January 10, 2025 )for the cooperative development
of the Hombre Muerto North Lithium Project ("HMN Li Project"),
located in Salta Province,
Argentina.
Letter of Intent
The Company and a non-related party ( the "Party") which will
remain confidential until the completion of a Definitive Agreement
("DA"), have entered into an LOI for the development and
financing of the HMN Li Project. The Party is a private European
corporation with strong financing abilities. The LOI was
entered into with the approval of the majority of the board of
directors of Lithium South. The following is a summary of the terms
of the LOI:
1. On a best-efforts basis, the Party will procure a
capital loan for up to US$10 Million
for the completion of a Definitive Feasibility Study ("DFS") on the
HMN Li Project;
2. On a best-efforts basis, the Party will procure project
Funding for 80% of the CAPEX as defined in the DFS;
3. An earn-in at the project level whereby the Party earns
10% upon delivery of a loan confirmation letter for up to
US$9million for the DFS and a further
30% upon delivery of a loan confirmation letter for project Funding
for 80% of the CAPEX;
4. At the option of the Party and at completion of the
Definitive Agreement, the Company agrees to issue to the Party
Special Warrants for a price of US$1
Million. The Special Warrants when converted will
equal 10 % of the issued and outstanding shares of LIS at the time
of conversion. The funds will be allocated 70% to the DFS and 30%
to general working capital.
5. The Party will obtain rights to 80% of the lithium
production at the HMN Li Project as an offtake, with a
commercialization commission of 4% of gross sales.
6. The Party will be granted rights of first refusal in
respect of the sale of any interest LIS holds in the HMN Li Project
and any future placement of equity in LIS.
The foregoing arrangements are subject to LIS and the Party
entering into a DA. Conditions Precedent to entering into the DA
include renegotiation of the existing Chemphys/LIS offtake
agreement to the satisfaction of the Party, completion of due
diligence by the Party within 60 days (which has already
commenced), the approval of each respective board, exchange and
regulatory approval and no material adverse change in the business
affairs of LIS or the Party.
During the 60 day period, the Company will not solicit any
further business interests nor continue with discussions with
current parties of interest.
Further details will be provided when available.
About Lithium South
Lithium South owns 100% of the HMN Li Project located in Salta
and Catamarca Provinces, Argentina, in the heart of the lithium
triangle. The Salar del Hombre Muerto has a history of
lithium production, with Arcadium Lithium (as a result of the Alkem
and Livent merger) in operation to the south of the HMN Li Project
for over twenty-five years.. Arcadium Lithium is currently
being acquired by Rio Tinto for U.S. 6.7 billion. The HMN Li
Project is adjacent to the east with a US$ multibillion
lithium development under construction by POSCO (Korea).
Exploration work to date has delineated a NI 43-101 compliant
1,583,200 tonne Lithium Carbonate Equivalent ("LCE") Resource (See
Note 1 below) on the Alba Sabrina, Natalia
Maria, and Tramo claim blocks, three of five non-contiguous
blocks that make up the HMN Li Project. A recent Preliminary
Economic Assessment published April 30,
2024, delineates potential to develop a 15,600 tonne per
year lithium carbonate project. A bulk sample of evaporated
brine from the project site is now being harvested for further test
work in Salta, Argentina.
On behalf of the Board of Directors
Adrian F. C. Hobkirk
President and Chief Executive Officer
Investors / Shareholders call 855-415-8100 / website:
www.lithiumsouth.com
Note 1: A report titled, Updated Mineral Resource Estimate –
Hombre Muerto North Project, NI 43-101 Technical Report Catamarca
and Salta, Argentina,
Mark King, PhD, PGeo, Peter Ehren, M.Sc, MAusIMM, September 5th, 2023.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release. The TSX Venture Exchange has not reviewed the content
of this news release and therefore does not accept responsibility
or liability for the adequacy or accuracy of the contents of this
news release.
This news release contains certain "forward-looking statements"
within the meaning of Section 21E of the United States Securities
and Exchange Act of 1934, as amended. Except for statements of
historical fact relating to the Company, certain information
contained herein constitutes forward-looking statements.
Forward-looking statements are based upon opinions and estimates of
management at the date the statements are made and are subject to a
variety of risks and uncertainties and other factors which could
cause actual results to differ materially from those projected in
the forward-looking statements. The reader is cautioned not
to place undue reliance on forward- looking statements. We
seek safe harbor.
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SOURCE Lithium South Development Corporation