Calidus Resources has joined forces with Haoma Mining NL to create a 50:50 lithium exploration joint venture in the Pilbara region in Western Australia.

The joint venture, dubbed as Pirra Lithium, will hold tenements and lithium rights across the most prospective lithium acreage in the portfolios of its parent companies. The tenements and lithium rights span an area of 1,063km2.

According to Calidus Resources, mapping of substantial pegmatites has already been done on the tenements. Of these, a number of them are associated with known tin-tantalum fields, said the Australian gold company.

The tenements are planned to be ranked initially for their lithium potential.

Field mapping will be immediately undertaken for the highest priority target areas. This will help the partners determine the distribution, orientation, size, and mineralogy of the pegmatites.

Calidus Resources’ managing director Dave Reeves said that the joint venture provides a low-cost opportunity to get exposure to an increased area of ground known for its lithium potential.

Reeves said: “Pirra Lithium creates a highly-leveraged exploration opportunity for our shareholders.

“There is clearly potential to unlock substantial value by exploring what is highly prospective lithium ground in one of the world’s best lithium provinces.

“We can capitalise on this opportunity without it having any impact on our core asset at Warrawoona, where we are on track to pour first gold in the coming quarter.”

Under the terms of the partnership, Calidus Resources will cover the first AUD1m ($0.72m) of funding for lithium exploration and managing the exploration by using existing infrastructure in the area. At that point, the two parties will equally contribute to the funding of Pirra Lithium.

Haoma Mining stated: “The formation of the joint venture with Calidus gives Haoma a low-cost opportunity to partner with an experienced East Pilbara based exploration company to unlock substantial value by exploring what is known to be highly prospective lithium ground in one of the world’s best lithium provinces.”

Closing of the joint venture deal is subject to the parties signing a formal mineral rights sharing agreement for governing the grant of the lithium rights to Pirra Lithium.