Notably, shares are up 53% at around midday to 2.0 cents signalling the market's approval of the deal.
The company will pay $100,000 for the option which will allow 45 days for FEL to conduct due diligence and secure funding to exercise the option at a $400,000 cost.
The Macarthur tenement package provides FEL with access to highly prospective ground in a world-class lithium, gold and base metals province near to tier one infrastructure.
Site visits and sampling conducted by Macarthur identified several targets for further exploration with several occurrences of observed pegmatite in outcrop.
The Hillside Gold Project, Panorama Gold Project and Bonnie Scot Gold Project are also leading gold prospects to be focused on.
FEL can earn up to 75% in three stages, the first stage being an initial 25% stake by spending $800,000 and paying $500,000 cash within 12 months.
A further 30% can be earned by spending an additional $750,000 and paying $750,000 in cash or shares within 24 months.
The third stage earning the final 20% taking the total interest to 75% required a further $750,000 expenditure and $750,000 in cash or shares within 36 months of exercise.
$2 million placement to fund potential exercise
Should FEL elect to exercise the option within the 45-day period, it proposes to fund the transaction through a share placement during June 2019 to raise $2 million.
The issue price is expected to be 1.5 cents and come with a 2-cent option for every four shares subscribed for.