Trident Expands Holdings with Acquisition of Lithium Royalty from Atherton Resources

Trident Royalties, a UK-based mining royalty firm, has formally inked an agreement to acquire an existing lithium royalty associated with Atherton Resources' projects owned by Anson Resources.

Situated in the Paradox Basin in Utah, USA, these lithium projects are considered the flagship endeavor for Anson Resources, boasting a market capitalization of approximately $113 million (A$175 million). The acquired royalty encompasses all of Anson's projects within the Paradox Basin.

As part of the acquisition agreement, Trident has committed to a payment of $10 million, which will be disbursed in three separate tranches. The initial payment, totaling $1.5 million, will be made in cash upon the deal's closure.

Subsequent payments will be contingent on Anson commencing commercial production at the projects. Trident will provide up to $3.5 million for the first tranche payment upon the project's commercial operation. Notably, up to 50% of this payment can be issued in the form of Trident's shares.

On the second anniversary of the first tranche payment, Trident will be required to make an additional payment of up to $5 million. Similar to the first tranche, this payment also offers the option to allocate up to 50% of the total in shares.

Anson Resources' definitive feasibility study, released in September of the prior year, projected an annual production capacity of 13,074 tonnes of lithium carbonate (Li2CO3) for the initial ten years of operation.

Anson anticipates reaching a final investment decision by the conclusion of the current year. This ambitious project is expected to generate annual revenue of $11 million during the first decade, assuming a spot price of $35,000 per tonne of lithium carbonate.

The royalty associated with these projects is a 2.5% net smelter return royalty and is intrinsically linked to Anson's ownership of the Paradox Basin projects. If Anson decides to sell a property within the Paradox Basin, Trident will be entitled to 2% of the net sales proceeds, with the royalty no longer applying to the divested asset.

Adam Davidson, CEO of Trident, expressed enthusiasm regarding the acquisition, stating, "We are delighted to announce the acquisition of this royalty over the Paradox lithium project. For a modest initial cash outlay, we have secured exposure for shareholders to a well-funded, highly attractive project with a pathway to cash generation and significant growth potential."

Davidson further emphasized the significance of the Paradox project in enhancing Trident's position in the battery materials sector. Additionally, it introduces exposure to direct lithium extraction, which is poised to play a substantial role in the future supply of lithium.

This strategic acquisition underscores Trident's capacity to identify innovative transactions that ultimately contribute to the creation of shareholder value.