Arcadia Minerals reports ongoing negotiations with Xinhai and Karibib farm-in milestone

Swanson tantalum deal inches forward despite expired option

Arcadia Minerals (ASX:AM7) is keeping the Swanson Tantalum Project alive with Hongkong Xinhai Mining Services Limited as talks continue past the expiry of a 45-day exclusivity option. The binding term sheet granted Xinhai the exclusive right to enter a definitive agreement to build and commission a gravimetric plant at ML223 and explore EPL 5047 for lithium and tantalum pegmatites. While the option formally expired during the quarter, Xinhai’s due diligence is ongoing, with draft definitive terms now under negotiation following a technical review that addressed mining cost clarifications. There is no guarantee a final deal will be reached, but the engagement with Xinhai signals sustained interest from a global mining services heavyweight experienced in over 600 projects worldwide.

This development follows the company’s earlier announcement of the option grant in January 2026 and the detailed feasibility study confirming Swanson as a significant cash generator. The project’s transition to production via a partner like Xinhai could provide Arcadia with a cashflow-generative operation while limiting upfront capital demands and shareholder dilution. The Swanson project holds a JORC mineral resource of 2.59 million tonnes grading 486 ppm tantalum oxide and an ore reserve supporting robust economics under conservative assumptions.

Karibib farm-in progresses with initial cash milestone received

Meanwhile, Arcadia’s Karibib Copper Gold Project in Namibia’s Damara Belt remains in good standing as the binding farm-in agreement with Perth-based Kaoko Metals Pty Ltd advances. Kaoko has completed the first stage of the four-stage earn-in, triggering a cash payment of A$150,000 to Arcadia. The farm-in allows Kaoko to earn up to 100% interest in the Karibib entity through staged cash payments, royalty grants, and milestone share issuances. Karibib’s location near significant gold and copper deposits, including the recently acquired Twin Hills deposit and the Navachab Gold Mine, underpins its latent exploration potential.

Arcadia’s strategy to maximise shareholder exposure while minimising dilution is evident in these farm-in and earn-in deals, which bring in credible partners to accelerate project development. The Karibib farm-in was first announced in October 2025, and the recent payment milestone confirms tangible progress in unlocking value from this copper-gold asset.

Bitterwasser lithium project remains on standby amid market caution

The Bitterwasser Lithium Project, comprising lithium-in-clays and lithium brines assets, remains in good standing but saw minimal activity during the quarter. Arcadia plans further low-cost test work and potential infill drilling to upgrade the resource classification. However, the company has shifted focus away from Bitterwasser to other portfolio projects, reflecting subdued lithium market sentiment. Despite this, Arcadia maintains the project for a potential market recovery, given its substantial inferred lithium resource exceeding 85 million tonnes at 633 ppm lithium.

Financial position and exploration outlook

Arcadia spent a modest A$63,000 on exploration and development activities during the quarter, with no production-related expenditure. The company’s cash balance improved significantly to A$364,000 by quarter-end, supported by financing activities including a net inflow of A$464,000. No payments were made to related parties during the period. The company holds 132.4 million CDIs and 13 million options on issue.

Exploration across the TVC Ta-Li and Ni-PGE Projects continued at a minimal level, with Arcadia reviewing historic data and recent sampling results that suggest promising critical mineral potential. The company is assessing a 1,000m drilling program over the broader TVC area, which includes tenements subject to the Xinhai option and other ongoing discussions for joint ventures. This measured approach aligns with Arcadia’s broader strategy to secure project-level partnerships to advance its diversified Namibian portfolio efficiently.

Arcadia’s recent history of engagement with Xinhai and Kaoko Metals, combined with its prudent cash management, underscores a cautious but constructive path towards unlocking value from its tantalum, copper-gold, and lithium assets in a challenging market environment. The evolving terms with Xinhai and the farm-in progress at Karibib will be key developments to monitor in the coming months.

The company’s quarter also saw the release of its half-year financial report, consolidating its position as a diversified explorer focused on critical and strategic metals in Namibia.

For additional background, the exclusivity period with Xinhai and its focus on mining cost clarifications were detailed in the company’s March update, while the initial option grant and earn-in deal were covered in earlier announcements. These milestones provide context to the current negotiation phase and the farm-in progress at Karibib, reinforcing Arcadia’s steady advancement despite the absence of immediate production activity.