ASX-listed Lithium Australia has struck a deal with fellow listed Eastern Resources to divest of a 70% interest in the Lepidolite Hill lithium project, in Western Australia.

Under the agreement, Eastern Resources will acquire the majority share in the project for A$550 000 in cash, paid over three tranches. Lithium Australia will be free-carried until a definitive feasibility study (DFS) has been completed.

Under the agreement, Lithium Australia and Eastern Resources will collaborate towards an offtake agreement of not more than 30% of the lithium product extracted from the Lepidolite Hill lithium project.

Eastern Resources could also, up until a notification that a DFS has been completed, elect to acquire Lithium Australia’s 30% participating interest by paying A$1-million in cash or Eastern Resources shares.

“This divestment of the majority of the Lepidolite Hill lithium project further simplifies the company. Over the past few months, we have defined the commercialisation and growth pathways to deliver customer-focused solutions for the lithium-ion circular battery materials industry that will accelerate global electrification for our solutions pathways," said Lithium Australia CEO Simon Linge.

“We are pleased to partner with Eastern Resources who will advance the Lepidolite Hill lithium project, while we focus on our technology platforms of lithium extraction, battery materials and battery recycling.”