Prospect Resources Ltd (ASX:PSC), a battery metals explorer transitioning from lithium to copper, operating mainly in Zimbabwe and Zambia, has agreed to sell its Step Aside Lithium Project in Zimbabwe for up to $2.2mn under a staged consideration structure.
The Share Sale and Purchase Agreement has been executed with Fatima Resources Pty Ltd, a private company with operating experience in Zimbabwe. The agreement provides for an upfront payment of $850,000 upon completion, followed by a $150,000 deferred payment six months later.
A further $1.2mn may be payable within 24 months if specified development milestones are achieved. These include securing binding offtake agreements, upgrading the mineral resource, or a future transaction valuing the project above $5.0mn.
Step Aside was explored between 2022 and 2024, with drilling confirming spodumene-bearing lithium mineralisation hosted within a pegmatite system. Prospect shifted focus to its Mumbezhi Copper Project in northern Zambia following the decline in lithium prices and the emergence of Mumbezhi as a larger-scale development opportunity.
Proceeds from the sale will be directed to advancing ongoing drilling and resource growth at Mumbezhi, as well as reviewing other copper opportunities in Zambia. Prospect noted that the sale also simplifies its corporate structure and reduces overhead.
Prospect Managing Director and CEO Sam Hosack said: “We are satisfied with the outcome of this sale agreement with a reputable company with extensive operating experience in Zimbabwe. This transaction offers us both upfront cash return and future upside to subsequent exploration success and value growth at Step Aside.”
He added: “The lithium opportunity at Step Aside showed classic spodumene bearing lithium mineralisation… The identification of a co-joined mineralised pegmatite system that remains open in multiple directions and at depth… justifies further drill testing, which is planned by the Buyer.”
Hosack said the company is now focused on the Mumbezhi Copper Project, stating: “We believe the future stewardship of Step Aside is in good hands… while we focus on the very exciting Mumbezhi Copper Project in Zambia.”
The Step Aside Lithium Project is located approximately 35km east of Harare, within the Archaean Harare Greenstone Belt, and 8km north of the Arcadia Lithium Mine, which Prospect discovered and later sold to Huayou Cobalt in 2022 for $378mn. The project area covers about 100 hectares and is permitted for mining, pending environmental approval, with infrastructure access in place.
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