Flagship banks $5.8M from Asian lithium sale for copper, gold push

Flagship Minerals has rung the till on its Thai lithium asset, pocketing a cool US$4 million (A$5.8 million), in a deal that completes its strategic transformation into a pure-play gold and copper explorer.

The company has executed a binding agreement to sell its 100 per cent-owned RK Lithium project in southern Thailand to a Thai-based syndicate led by the privately held Pendulum Auto Co., Ltd, with half the cash expected to land this week.

Flagship also revealed discussions are ongoing for the sale of its Khao Soon tungsten project, which it touts as one of the largest undeveloped tungsten assets in South-East Asia.

The twin divestments clear the decks, allowing the company to pour its resources into two potentially company-making projects, a multi-million-ounce gold deposit in Chile and a massive copper target in Canada.

‘The divestment of the RK Lithium project brings A$5.8m cash into Flagship.’

While the asset sales provide the cash, the main game for Flagship is its Isidora Norte gold porphyry deposit in northern Chile. The company has muscled its way into the multi-million-ounce club, recently tabling a monster 2.1-million-ounce JORC-compliant resource for the project.

The inventory clocks in at a hefty 115.2 million tonnes grading 0.56 grams per tonne gold. Perhaps more importantly, a massive 91 per cent of those ounces, or 1.9 million, already sit in the higher-confidence measured and indicated categories, giving the company a solid foundation for its future development studies.

Positioned in the famed Atacama mining region, Isidora sits within the prolific Maricunga gold belt, a 200km-long district that hosts a conga line of multi-million-ounce gold deposits. The project rubs shoulders with giants, including Barrick and Newmont’s 27.3-million-ounce Norte Abierto project and Kinross’s 10.7-million-ounce Maricunga project.

As its second act, Flagship has planted a copper flag in Canada by acquiring the Whipsaw project in British Columbia, gaining exposure to a potential billion-tonne-scale system in a tier-one jurisdiction.

The project sits just 17 kilometres west of Hudbay Minerals’ massive 16-million-tonne-per-annum Copper Mountain mine. A wealth of historical work has already underpinned a whopping preliminary JORC exploration target for Whipsaw, ranging from 500 million to 1.02 billion tonnes at a grade of 0.2 to 0.4 per cent copper equivalent.

Flagship Minerals managing director Paul Lock said: “The divestment of the RK Lithium Project brings ~A$5.8m cash into Flagship. The funds will enable Flagship to focus its resources on progressing its 2.2Moz Isidora gold project in Chile to feasibility and the preparation of the Whipsaw copper project in Canada for a potential spin-out via an ASX listing. Flagship is in high level discussions for the sale of its 100% owned Khao Soo tungsten project, which is one of the largest undeveloped tungsten projects in southeast Asia.”

The dual-asset strategy gives the company two significant shots on goal in two of the world’s most sought-after commodities and regions. Flagship has even flagged the potential for a spin-out of the massive Whipsaw project into its own dedicated ASX-listed copper vehicle if the numbers stack up.

Adding to Flagship’s basket of assets, the company has a handy little side bet with some sting in its tail - an option to buy 100 per cent of the Rosario copper project, a high-grade copper-silver play in Chile’s Atacama region, just 10km from Codelco’s El Salvador mine. There, it’s chasing manto-style mineralisation across a 15km strike, with early surface work already throwing up rock-chip grades of up to 8.9 per cent copper.

The sale of the RK lithium project appears to be a classic case of strategic asset management. Rather than trying to be a jack-of-all-trades, Flagship has cashed up and sharpened its focus.

With a bolstered balance sheet and a crystal-clear strategy, the company now has a trio of formidable projects to advance. The lithium sale wasn’t an exit; it was a reload, providing the fuel to drive its gold and copper ambitions forward.

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