IronRidge Resources signed a conditional binding agreement with Piedmont Lithium to fully fund and fast track the development of Ewoyaa lithium project in Ghana for $102m.

The Ewoyaa lithium project is IronRidge’s Ghanaian Cape Coast Lithium Portfolio, which covers some 684km2. The project is said to be ready for advancement through the development stages to production.

In January, a scoping study on the lithium project supported a business case for a 2Mtpa production operation with life of mine (LOM) revenues of more than $1.55bn.

With a current mineral resource of 14.5 million tonnes (Mt) at 1.31% Li2O, the Ewoyaa project is said to have a potential to be a large, low-cost spodumene concentrate (SC6) producer.

Piedmont president and CEO Keith Phillips said: “We consider IRR’s Ewoyaa Project to be among the world’s most promising spodumene projects. The high-grade mineral resource is currently modest in scale but offers substantial exploration potential, and the project is very well-located, being only 70 miles from a major port.

“Ewoyaa builds on Piedmont’s strategic commitment to be a large-scale and low-cost producer of lithium hydroxide from spodumene concentrate sourced from diverse sustainable resources in favorable jurisdictions.”

Under the terms of the agreement, Piedmont to earn 50% of IronRidge’s Cape Coast Lithium Portfolio, by making staged investments.

Piedmont will invest $15m to acquire a 9.47% equity stake in IronRidge in the first stage.

In the second stage, the company will have an option to earn up to an initial 22.5% project interest by making an investment of $17m to fund ongoing exploration and a definitive feasibility study over the next 24 months.

The final stage involves an investment of further $70m in 2023-2025 to fund the construction of the Ewoyaa project. It will allow Piedmont to gain an additional 27.5% in the project.

Piedmont has also signed an offtake agreement with IronRidge for 50% of spodumene concentrate production from the project.

IronRidge is a Africa focused minerals exploration company with a significant lithium pegmatite discovery in Ghana.

In June, the company revealed plans to demerge its gold assets in Côte d’Ivoire and Chad into a new gold-focused entity.