On 26 July 2016 the Company announced that it had executed a binding Terms Sheet with Charge Lithium Pty Ltd (Charge) to acquire 100% of the shares on issue in Charge. Charge was the holder of exploration licence applications in Western Australia.
On 9 November 2016, the Company completed the acquisition of the (Charge), following receipt of shareholder approval, which was received in October 2016.
The Company carried out exploration activities on its acquired Charge Litihium projects as noted below. Preliminary work has begun on the group of tenements collectively titled the Great Southern Group including Pyramid Lake (E74/594), Ravensthorpe (E74/593) and Jerramungup (E70/4861).
The Lake Pyramid Project is located approximately 150km north of the Port of Esperance in Western Australia. Cohiba is in the fortunate and unique position of having established infrastructure close at hand with sealed roads and main power adjacent to the lake and close proximity to the Esperance agricultural market.
Preliminary results have been received from samples of brine and sediments that were taken during the reconnaissance site visit earlier in the year. Elemental results show elevated levels of potassium and calcium as components of potash and gypsum but further testing is required to ascertain the lakes potential as a host for potash within brines as either Mureate of Potash (MOP), Sulphate of Potash (SOP) or a variant, or gypsum within the lake side dunal system similar to those found around Lake Tay to the north. The Company is following up additional analysis currently.
E74/593 lies due south of the town of Ravensthorpe and is surrounded by lithium rich pegmatite in the Mt Cattlin mine as well as reports of high grade lithium found by other junior explorers.
The tenement area is largely covered by dense bush with minor farmland so access was limited to existing roads and tracks or through cleared farmland with permission from the owner. Many of the tracks and roads were impassable due to recent flooding that had destroyed several bridges and roads in the district.
The Company has announced that assay results have been received from the reconnaissance sampling undertaken earlier in the year. Unfortunately, no significant results were received for lithium from the pegmatites sampled.
Ground access at the time was severely limited due to the recent flooding events that cut roads and tracks, and the dense bush covering the majority of the tenement. The Company is reviewing its options for future exploration in the area.
Following shareholder approval sought at the Company’s General Meeting held on 27 June 2017, the Company completed the acquisition of all issued shares in Cobalt X Pty Ltd (Cobalt X) as announced to the ASX on 20 February 2017.
On 24 July 2017, the Company issued the consideration shares, with 50% of the shares being escrowed for 12 months from the date of issue. A total of 75,000,000 consideration shares were issued.
The Company is the holder of various exploration licences through its wholly owned subsidiary Cobalt X Pty Ltd. As at the date of this report the Company is the holder of the following mineral exploration licences pursuant to the Mineral Resources Act 1989 (QLD):
The Wee Macgregor group comprises three granted mining licences, ML 2504, ML 2773 and ML 90098. These licences are located approximately 60km southeast of Mr Isa with access via the sealed Barkly Highway and the unsealed Fountain Springs Road. The Wee Macgregor project (licence ML 2504) has an existing JORC 2012 estimated Inferred Resource of 1.65Mt @ 1.6% Copper and an exploration target of between 1.0 – 1.5Mt @ 2.3 – 3.7% Copper as determined by the previous tenement operator. The exploration target is conceptual in nature as there has been insufficient exploration to define a mineral resource. It is uncertain whether future exploration will result in the determination of a Mineral Resource under the ‘Australian Code for Reporting Exploration Results, Mineral Resources and Ore Reserve – JORC Code 2012’. The exploration target is not being reported as any part of a Mineral Resource or Ore Reserve.
 Ref: ASX Announcement AGY, 9/12/15 http://www.asx.com.au/asxpdf/20151209/pdf/433p3ftdptvbrt.pdf.
On 24 January 2018, the Company announced that it has entered into a binding Terms Sheet (Terms Sheet) in relation to a proposed farm-in to a joint venture in respect of seven distinct exploration tenements located in South Australia, with a total portfolio licence area of 1094km2 with Olympic Domain Pty Ltd (ODPL or Olympic Domain), an Australian proprietary company. The Company completed due diligence and the execution formal agreements on 7 March 2018.
Below is a listing of the exploration licences relating to the farm-in:
|EL Number||Locality||Area Km2|
|EL 5082||Lake Torrens A (Approx. 50km east of Olympic Dam)||344|
|EL 5023||Lake Torrens B (Approx. 75km east of Olympic Dam)||355|
|EL 5084||Lake Torrens C (Approx. 80km east of Olympic Dam)||103|
|EL 5085||Lake Torrens D (Approx. 15km east of Andamooka)||25|
|EL 5086||Sandy Point (Approx. 55km SSW of Andamooka)||29|
|EL 5224||Horse Well (Chinaman Swamp area, approx. 30km NNE of Woomera)||118|
|EL 5970||Pernatty B and C (Approx. 60km south of Andamooka||120|
Olympic Domain Pty Ltd (Olympic Domain or ODPL) grants CHK the right, but not the obligation, to acquire a 30% interest in the ODPL tenements (Stage 1 Interest) by:
Subject to CHK earning the Stage 1 Interest, Olympic Domain grants CHK the right, but not the obligation, to acquire a further 21% interest in the ODPL tenements (Stage 2 Interest) by:
Subject to Cohiba earning the Stage 2 Interest, Olympic Domain grants Cohiba the right, but not the obligation, to acquire a further 29% interest in the ODPL tenements (Stage 3 Interest) by incurring aggregate Expenditure (including expenditure incurred in connection with obtaining the Stage 1 Interest and Stage 2 Interest) of not less than $1,500,000 within 3 years of the date of the Farm-In Agreement.
CHK has agreed to it will incur expenditure of not less than $500,000 in the Stage 1 Period (Minimum Expenditure) provided that CHK is relieved from this obligation (and its obligations to make any payment under (e) below) to the extent that its ability or capacity to make the Minimum Expenditure is adversely affected as a result of a breach of warranty by Olympic Domain, a force majeure event or a breach by Olympic Domain of a material term of the Farm-In Agreement. The warranties provided by Olympic Domain include warranties under which it has agreed to: (i) obtain all permits, consents and approvals necessary to permit the timely conduct of exploration programs agreed during the farm-in period; and (ii) obtain approvals for extensions or waivers of timeframes for annual or periodic expenditure requirements sufficient to enable CHK a reasonable opportunity to pursue and obtain the earn-in rights granted to it under the Farm-In Agreement.
If CHK does not incur the Minimum Expenditure, subject to the circumstances in which it may be relieved of its obligations as referred to in paragraph (d) above, CHK must pay an amount of $300,000 to Olympic Domain. This sum is payable (at CHK’s election) in cash, shares, or a combination of shares and cash. If shareholder approval is required for the issue of shares CHK has agreed to endeavor to obtain that approval in an expedient manner.
Subject to the above, the Farm-In Agreement provides that CHK may elect not to incur expenditure and to withdraw from the Farm-In Agreement at any time prior to earning the Stage 1 Interest, Stage 2 Interest or Stage 3 Interest whereupon its unexercised earn-in rights lapse.