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(Sharecast News) - Ascent Resources announced on Wednesday that it has signed an option agreement that could allow a third party to extract lithium and potash from mineral-rich brines in Utah, opening a new potential revenue stream from its US acreage without requiring additional development spending.
The AIM-traded company said it and its partner American Helium had granted Neometals and Omaha Value a 60-day exclusive option to negotiate a licence over Ascent's existing wells and leases in the Paradox Basin.
It said the arrangement would give the prospective operators access to deep artesian brines intersected during historical oil, gas and helium exploration, with the aim of evaluating and potentially extracting critical minerals.
Ascent said the deal provided a monetisation route for its Paradox position "with no upfront drilling or development cost to the company," pointing to the strategic value of its acreage for multiple commodities, including hydrocarbons, helium, carbon dioxide sequestration and now critical minerals.
The company noted that lithium and potash benefitted from US critical mineral status, which could enable accelerated permitting and access to federal funding.
If the option was exercised, Neometals and Omaha would pay a $50,000 option fee and a $1.9m permitting fee once the relevant mineral leases were granted, alongside an annual $0.2m licence fee.
A royalty of 2.5% of gross revenue would apply to brine production, rising to 3.5% if commercial extraction had not started within five years.
Ascent said it would receive 49% of all financial benefits under the agreement, with American Helium entitled to 51%.
The firm said the option would leverage existing wellbores and infrastructure, reducing the time and cost associated with drilling new wells.
During the exclusivity period, Neometals and Omaha would conduct technical, legal and commercial due diligence before deciding whether to pursue definitive agreements.
Ascent cautioned there was no guarantee the option would be exercised, nor that binding terms would be agreed.
Reporting by Josh White for Sharecast.com.