Hexagon Energy Materials has entered into an earn-in-agreement Green Critical Minerals for the McIntosh project in the East Kimberley of Western Australia.

The deal allows Green Critical Minerals to gain up to 80% of the graphite mineral rights at the McIntosh project tenements.

Hexagon will retain all other mineral rights at the project.

The McIntosh project consists of 17 tenements spread over an area of 542km² in the East Kimberley.

With a grading of 4.5% TGC, the project’s graphite assets are a combined total graphite resource of 23.8 million tonnes.

Hexagon managing director Merrill Gray said: “This deal delivers against Hexagon’s Future Energy Materials value creation strategy.

“Hexagon will benefit from additional cash and additional exploration expenditure at McIntosh, while we simultaneously focus on developing the Ni-Cu-PGE potential there is at McIntosh.

“We look forward to working collaboratively with the Green Critical Minerals team, sharing information and on ground resources and building substantial value off past Hexagon investment in Graphite.”

By securing all relevant ASX listing rules and listing approvals, Green Critical Minerals has to complete the raising of capital/funds of not less than $4.5m net cash by 31 August this year, to earn the stake in the project.

To acquire the stake in the McIntosh project graphite mineral rights, Green Critical Minerals will have to invest A$3m ($2.1m) in exploration expenditure over four years. It is also required to pay a total cash of $500,000 to Hexagon.

In late 2021, Hexagon entered into an earn-in agreement with South Star Metals for the Ceylon (Alabama, USA) graphite project.

The deal was expected to speed up project development through the skills the South Star team.