The Andromeda Metals Ltd (ASX: ADN) share price is in the green after the company announced a new joint venture.
Andromeda has entered an agreement to join forces with an unlisted company, Peninsula Exploration to explore 4 tenements located near Andromeda's Great White Kaolin Project.
The Andromeda share price is up 4.25% on the back of the news today. Shares in the mineral exploration company are currently swapping hands for 16 cents apiece.
Let's take a closer look at Andromeda's new partnership.
New joint venture
Andromeda's new partnership will form the Eyre Kaolin Project Joint Venture.
Andromeda's geology team expects the site to be prospective for halloysite, and kaolin clay has already been found there.
According to Andromeda, targets at the project have returned similar results to the Great White and Mount Hope Projects.
The Andromeda share price has a history of soaring on good news regarding the company's kaolin ventures.
Peninsula Exploration already holds the exploration licences for 4 tenements covering a 2,799 sqm area on South Australia's Eyre Peninsula.
Andromeda has agreed to pay Peninsula $20,000 to enter the joint venture. Over the next 12 months, the company will spend a further $140,000 on the project.
In the project's first stage, if Andromeda spends $750,000, it will earn a 51% interest in the joint venture.
After the first stage, Andromeda could earn another 29% by spending an additional $2 million.
At that point, Peninsula can choose to swap its 20% holding for a 1.5% net profit royalty if the companies decide to mine the tenements.
Andromeda share price snapshot
Today's gains haven't been enough to boost the Andromeda share price out of the red this year.
Andromeda shares are trading hands for 47.7% less than they were at the start of 2021.
However, the share price has grown by 224% since this time last year.
The company has a market capitalisation of almost $400 million. There are approximately 2.46 billion shares outstanding.
