Neometals’ Utah Brine Deal Hinges on Due Diligence and Permitting Success

Strategic Entry into US Critical Minerals Sector

Neometals Ltd (ASX – NMT) has taken a significant step into the US critical minerals landscape by signing an exclusivity and option agreement with American Helium LLC and Ascent Resources plc. This deal grants Neometals and its US partner Omaha Value, Inc. a 60-day exclusive window to conduct due diligence and negotiate a definitive access and use licence over a portfolio of inactive oil and gas wells in Utah’s Paradox Basin. The basin is known for its lithium and potash-rich brines, critical components in the global push for cleaner energy technologies.

Leveraging Existing Infrastructure to Accelerate Exploration

The agreement is notable for its capital-light structure, requiring only a US$50,000 exclusivity fee initially, with a US$1.9 million permitting fee payable upon securing government permits for exclusive brine extraction. By utilising existing well bores, leases, and infrastructure, Neometals and Omaha Value aim to significantly reduce exploration costs and timelines. This approach could fast-track the evaluation of approximately 47,000 acres of tenure applications held by Omaha’s subsidiary, Utah Brine Corporation LLC, in the Lisbon Valley area.

Favourable Geology and Regulatory Environment

The Paradox Basin’s geology features thick evaporite sequences and permeable clastic formations hosting lithium and potassium-rich brines, with historic assays indicating lithium concentrations up to 147 mg/L and potassium exceeding 33,000 mg/L. The project benefits from proximity to existing natural gas processing infrastructure and access to low-cost Rocky Mountain Power electricity. Moreover, potash and lithium’s designation as critical minerals by the US Department of the Interior opens doors to expedited permitting and federal funding, aligning well with national strategic priorities.

Commercial Terms and Future Prospects

Should Neometals and Omaha Value exercise the option, the access and use licence will grant rights to explore, sample, and potentially extract brines, with a 2.5% gross smelter royalty payable to American Helium and Ascent upon commercial production. The licence includes provisions for infrastructure modification and water rights utilisation, essential for sustainable brine extraction and reinjection. However, the project remains contingent on successful due diligence, permitting, financing, and regulatory approvals.

Positioning for Growth in Critical Minerals

Neometals’ Managing Director Christopher Reed highlighted the company’s extensive lithium expertise and the strategic advantage of leveraging existing oilfield assets in a top-ranked mining jurisdiction. This move complements Neometals’ broader portfolio, including lithium processing technologies and other mineral projects, positioning the company to capitalize on growing demand for critical minerals essential to the clean energy transition.