Rock Tech Lithium (CVE:RCK) announced Wednesday that it has entered into an option agreement to acquire a 100 per cent interest in a graphite property in southwestern Quebec, from UniMera Holding Public Ltd, as it seeks to diversify its asset base in advanced technology materials.
Rock Tech said the option property is prospective for large flake, crystalline graphite and has a historic record of exploration for graphite mineralization and production.
Shares of the company rallied 5.00 per cent just before 12 pm EDT, trading at 10.5 cents.
"The acquisition of the highly prospective graphite property aligns with the company's objective of diversifying its asset base in the advanced technology materials category," said Rock Tech president and CEO, Eunho Lee.
"With the emergence of large flake graphite use in lithium-ion batteries and fuel cells, along with its many other technology-driven applications such as the use of carbon fibre in the auto and aviation sectors, adding a complementary asset to our portfolio of lithium projects positions Rock Tech with the potential of providing an integrated mix of materials for the high tech and alternative energy sectors."
The Quebec property consists of 32 mineral claims, covering 19.23 square kilometres in the Buckingham region of Lochaber Township, 45 kilometres to the northeast of Gatineau.
Over an area of two by eight kilometres long, there are three graphite occurrences, referred to as the McLaren, Kelly and Burke, and two past producing mines called the Mayo and the Plumbago.
The company noted that the agreement is subject to a three per cent net smelter royalty (NYSE:NSR) and includes an initial payment of C$20,000, which has already been paid.
Rock Tech said it will also pay UniMera C$60,000 in cash, and 1.8 million common shares of the company within three business days from the date of TSX Venture Exchange approval.
Additionally, it will pay C$60,000 in cash and 1.1 million common shares of Rock Tech within one year from the exchange acceptance, and another C$60,000 cash payment and 1.1 million common shares within a year and a half.
Rock Tech must also spend a total of C$300,000 in exploration work on the property within a year of TSX-V approval.
Before the start of commercial production, two per cent of the NSR can be bought back for C$2.0 million, said the company.
Rock Tech is a Canadian based resource company focused on the acquisition and development of lithium properties.
The company's portfolio includes an advanced stage lithium-bearing pegmatite project with an NI 43-101 resource estimate in the Thunder Bay mining district of Ontario, and two early stage lithium-bearing pegmatite projects in northern and western Quebec.
In February, Rock Tech unveiled the remaining drill results from the second phase of its exploration program at its Georgia Lake lithium project in Ontario.
The aim of the second phase of the program was to add new resources to the NI 43-101 compliant estimate announced in October last year, of 2.36 million indicated tonnes of 1.17% lithium oxide (Li2O) and 4.36 million inferred tonnes of 1.08% Li2O.
Highlights of the drill results included 1.20% Li2O over 8.84 metres, 1.11% Li2O over 3.10 metres, and 0.82% Li2O over 1.0 metres in drill hole NC-11-23.
The company said that the second phase drilling also found anomalous values of rare metals, including rubidium, beryllium, cesium, niobium and tantalum.
The program consisted of 4,608 metres of diamond drilling over eighteen drill holes in addition to sixteen channel samples, testing pegmatite dykes located on the Nama Creek, Conway and Newkirk claim blocks.
Rock Tech has already reported very high purity levels from the property earlier this year. In late September last year, the company achieved a purity level of 99.988% lithium carbonate (Li2CO3) from a bulk sample. Battery manufacturers require a purity level of at least 99.5% Li2CO3.
Besides the battery industry, lithium has many uses, including heat-resistant glass and ceramics, casting for HVAC products, additives for greases and oil products, aluminum production, and as a pharmaceutical mood stabilizer.