Redzone Resources Ltd. [REZ-TSXV; REZZF-OTC] said Monday May 28 that it has satisfied all the conditions under its previously announced option agreement relating to the acquisition of 14 lode claims in Arizona.
The option agreement gave Redzone the right to acquire a 100% stake in the Lucky Mica claim group, which is located approximately 8 miles south west of the city of Wickenburg in Maricopa County, Arizona. The claims cover the Fortner and Boyd lithium deposit.
Pursuant to the terms of the option agreement, Redzone has issued 100,000 shares to the previous claimholders. As a result, Redzone’s new subsidiary, Arizona Lithium Resources Ltd. now holds all of its previously optioned Arizona property claims.
The claim total now stands at 236 and covers 4,876 acres.
The company is waiting on its notice-of-intent-to-disturb permit, which will allow it to begin the trenching of 19 areas, to a depth of 20 feet that were identified as high-priority targets during the chip sampling program conducted earlier this year.
The expectation is that results of this trenching program will result in the identification of drill targets for the next stage of exploration, which is targeted for this summer.
All the requirements for the trenching permit have been submitted and the company expects the permit to be issued soon. In addition, metallurgical samples will be taken to start determining the material’s amenable to processing.
Redzone is an exploration company with a focus on metals that make up and support the rapid evolution to battery power.
It is involved in two key projects. They are the Fortner Boyd lithium property in Arizona and the Lara property in Peru.
The Fortner Boyd claims (also known as the Lucky Mica claim group) were staked in the name of Godolphin Mining Inc., an Arizona corporation. Godolphin and Redzone entered into an agreement whereby Redzone was granted the right acquire 100% interest in the property. In return Redzone agreed to make a US$47,500 cash payment and issue 300,000 shares to two vendors.
Under the agreement, Redzone also pledged to pay a 0.667% net smelter return royalty to the vendors on all minerals produced, mined or otherwise recovered from the property. It also secured to the right to purchase 100% of the royalty for $1 million.
Meanwhile, a NI 43-101 compliant technical report dated February 13, 2017 showed that sampling of the previously discovered Lucky Mica pegmatite body or dyke yielded grades as high as 7.5% Li20 from a spodumene-rich grab sample.
The technical report was prepared with the help of SGS Canada and Paiement, who visited the property in January, 2017 and SGS Canada Inc.
Redzone shares eased 4.76% or $0.01 to 20 cents Monday on volume of 88,000. The 52-week range is 10 cents and 75 cents.