It has struck an option to buy 100% of the Sarcobatus Flats lithium property in Nye County, which lies just 70km south-east of Clayton Valley, home to the US's only producing lithium mine owned by Albermarle.
Sarcobatus project stood out from the pack
Chief executive Chris Healey said Sarcobatus stood out from the pack.
"We have been monitoring the surging lithium market as well as the deals being done in the space, and while I tend to critically scrutinize exploration assets given my 48 years as a geologist in the mining sector, the Sarcobatus lithium opportunity in Nevada hosts a number of key advantages both in terms of its geological characteristics as well as the acquisition terms negotiated by Rainmaker.
"We believe we can advance exploration quickly and economically, with the goal of discovering and developing a low cost lithium producer on the site, in mining-friendly Nevada."
It comprises 48 placer claims covering 1,000 acres and is anticipated to be a lithium brine project as opposed to a hard-rock deposit, known for much lower costs and faster time to production. It lies directly adjacent to the main US highway, the US 95.
Rainmaker intends to embark on a first phase exploration program as soon as possible.
Area seen rapid rise of exploration
This area of Nevada has seen a rapid rise in exploration, fuelled by the expected rise in demand of batteries and electric vehicle manufacture. Tesla (NASDAQ:TSLA) is building a huge factory in the area. Pure Energy has found 816,000 metric tons of lithium carbonate equivalent (LCE).
Under this deal, Rainmaker can earn 100% interest in the property by making a number of payments, including shares worth US$35,000 within seven days of the company receiving all necessary approvals from the Toronto venture exchange and US $75,000 in cash or shares at the first anniversary.
It must spend no less than US$50,000 on exploration in each of the first three years of the agreement.