Perth-based junior Kali Metals has consolidated its Pilbara footprint by acquiring SQM Australia's 30% interest in the DOM’s Hill and Pear Creek projects in Western Australia.

The transaction will see Kali move to 100% ownership of the two projects.

Under the terms of the deal, Kali will pay $60 000 in cash on settlement from existing reserves and issue $140 000 in shares, priced at the ten-day volume-weighted average price prior to and including the execution date. The shares will be subject to voluntary escrow for 12 months from issue. SQM will also retain a 1.5% net smelter return royalty on metals produced from the projects.

Completion of the agreement is conditional only on the receipt of certain transfer forms relating to the 30% interest currently registered to Kalamazoo Resources, which holds the interest in trust for SQM. Kali expects this condition to be satisfied shortly.

The consolidation builds on Kali’s Marble Bar gold strategy, with the company noting that a previously held 30% SQM interest in its Marble Bar gold project had already been returned to Kali as part of a restructure of the earlier option and earn-in agreement.

MD Paul Adams said the agreement marked an important step following several years of collaboration in the Pilbara.

“Kali is very pleased to have reached this agreement with our long-standing Pilbara exploration partner, SQM and we are particularly pleased to welcome SQM as a shareholder.

“The DOM’s Hill and Pear Creek projects were originally prospective for gold and base metals before being included in the SQM option and earn-in agreement. Now that this agreement has come to a close, we are ready to follow up on the gold and base metal opportunities previously identified, in a vastly improved metal price environment”.

He added that Kali would leverage technical knowledge gained over the past four years to advance gold and base metals exploration, complementing planned work at its nearby Marble Bar gold project.

The company believes that while historical gold and copper mineralisation has already been identified across the tenement package, the ground remains under-explored for these commodities, particularly in the context of stronger prevailing metal prices.