Bradda Head Lithium Limited (AIM:BHL, OTCQB:BHLIF, TSX-V:BHLI) has received US$2.5 million from Lithium Royalty Corporation following a project milestone at the Basin project in Arizona, where the next drilling programme also promises to unlock a further milestone payment.

Today’s US$2.5 million payment comes as the project’s mineral resource estimate surpassed 1 million tonnes of lithium carbonate equivalent (LCE), as reported in late September. It was the result of 2,355 metres of drilling completed in 14 holes.

A further US$3 million payment would be due if the next drill programme can expand the resource again, beyond 2.5 million tonnes of LCE.

The project’s next drill programme will comprise 3,000 metres across 10 holes. Bradda noted that the new programme is awaiting approval from the Bureau of Land Management.

"The receipt of our first royalty payment is a significant event, substantiating the company's confidence in its resource size and demonstrating the value of the Basin project, in particular,” executive chair Ian Stalker said in a statement.

“Following this, we are confident in proving up more than 2.5Mt of resource and triggering the final royalty payment of US$3 million from LRC.

“We are also expanding our claims, with indications that similarly positive geology extends to the north, into the new claims.

“These new claims will also feed into the high-grade potential of future resource expansion and will enable us to reach the 2.5Mt threshold for the next royalty payment more quickly.”

Bradda has added some 2.84 square kilometres of additional mining claims, which took the project to 19.7 square kilometres.

Stalker also highlighted that drilling continues at Bradda’s San Domingo project, with the programme now 50% complete, and he said “many of the holes have encountered long intervals of pegmatite with visible spodumene mineralization”.

He noted meanwhile that assay results have been slow to arrive due to the summer rush at the laboratory, but drilling progress is good.

Elsewhere, it is expected that drilling will start at the Morning Star project next, Stalker said.