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Beaufort Securities Breakfast Alert - Poor value energy tariffs to be capped

Beaufort Securities Breakfast Alert - Poor value energy tariffs to be capped


The FTSE-100 finished Friday's session 0.11% lower at 7,244.41, whilst the FTSE AIM All-Share index was up 0.32% at 1,043.39. In continental Europe, the CAC-40 finished 0.15% higher at 5,317.37 whilst the DAX was up 0.18% at 12,483.79.

Wall Street
Last night in New York, the Dow Jones added 347.51 points, or 1.39%, to end the week at 25,309.99. The S&P-500 finished 43.34 points higher at 2,747.3 and tech-focussed NASDAQ gained 127.31 points at 7,337.39.

In Asia this morning, the Nikkei 225 was 290.3 points, or 1.33%, higher at 22,183.08 heading into the close. The Hang Seng was up 0.7% at 31,484.88 and the Shanghai Composite added 1.15% at 3,326.96.


At around 6:00am, WTI crude was 0.46% higher at $63.84 per barrel and Brent crude was up 0.28% at $67.5 per barrel.



Poor value energy tariffs to be capped
Legislation to crack down on expensive energy tariffs is being introduced to Parliament on Monday. The government claims it will protect 11 million people from costly tariffs. The law will allow energy regulator Ofgem to limit what companies can charge customers for their standard variable tariffs. Energy UK, which represents gas and electricity suppliers, said it was vital the cap did not stifle competition in the energy market. The government says the Domestic Gas and Electricity Bill will limit the cost of standard variable tariffs until 2021 at least. The move is an admission that encouraging consumers to regularly switch providers to pay less has not been as successful as hoped. About a third of households are charged a variable price for their energy at a default rate set by their energy company, because they have not chosen to shop around for a cheaper fixed-price deal.

Source: BBC News

Company news


Altus Strategies (LON:ALS) 7.88p – Speculative Buy
Altus Strategies announced that it has been granted the Zaer licence comprising six permits covering 96km2 targeting copper, tungsten and tin mineralisation in central Morocco. The Zaer licence hosts a 20km long geologically prospective metamorphic aureole which historic reports suggest the presence of 2.35km of copper-bearing quartz veins. Altus is planning an initial The Company also announced that it has relinquished four early stage exploration licences in Morocco after initial work demonstrated that they are unlikely to host economic deposits.

Our view: Altus’ strategy is to develop joint venture partnerships under its project generation model. With the acquisition of the Zaer exploration licence, management is targeting copper, tungsten and tin mineralisation in a region that hosts a number of active and past producing mines and deposits. These include the Achmmach tin project of Kasbah Resources (KAS.A), the Sokhret-Allal tin-tungsten deposit and the Koudiat Chebia tungsten deposit located 90km, 4km and 6km of the Zaer licence, respectively. As such, we look forward to updates from the initial exploration programme. In the meantime, we maintain a Speculative Buy recommendation.

Beaufort Securities acts as corporate broker to Altus Strategies plc

Jubilee Metals Group (LON:JLP) 3.00p – Speculative Buy
Jubilee and BMR provided updates on the Kabwe situation on Friday afternoon. BMR reported that following meetings with the Zambian Mining Ministry, preparation of its appeal is "well advanced" and is expected to be submitted before March 2nd. Meanwhile Jubilee has "engaged directly" with the ministry "to demonstrate its commitment to providing technical, operational and financial strength to the Kabwe project". Jubilee’s "engagements were well received by the Zambian Department of Mines". Jubilee is planning a follow up meeting with the ministry to further demonstrate its capabilities. We expect this to occur in March.

Beaufort Securities acts as corporate broker to Jubilee Metals Group plc


Savannah Resources (LON:SAV) 6.10p – Speculative Buy
Savannah Resources announced an updated JORC (2012) compliant inferred resource estimate and initial exploration target for its highly prospective Mina do Barroso lithium project, in Portugal. The combined inferred mineral resource estimate now stands at 9.1Mt grading 1.03% Li2O for 94,100t of contained lithium oxide for the Reservatorio, Grandoa and NOA deposits, representing a 200% increase from the maiden resource for Reservatario. In addition, an initial exploration target of 8-12Mt grading 1.0% to 1.2% Li2O has been set for the Reservatorio and Grandoa deposits. The updated resource now covers three of at least eight known lithium bearing pegmatites within the Mina do Barroso mining licence. Recent drill results from the Grandao deposit returned some of the thickest zones to date, for example, 109m grading 1.04% Li2O including 52m grading 1.32% Li2O. Whereas, preliminary metallurgical testwork confirmed that a high-quality spodumene concentrate could be produced using conventional processing technologies.

Our view: The updated combined lithium resource estimate and exploration target underpins the significant potential of the Mina do Barroso lithium project as a source for spodumene concentrates. We note that initial metallurgical testwork confirms the spodumene dominate lithium mineralisation and that the project has an existing mining licence within a mining friendly jurisdiction, which taken together could potentially lead to near-term production. Given the numerous lithium bearing pegmatites and excellent existing infrastructure, we believe Mina do Barroso could be a significant and strategic source for spodumene concentrates in Europe. With the global lithium demand is expected to treble by 2025 on the back of the burgeoning battery market, Savannah is looking to capitalise on the lithium market with a strategic European lithium source. We look forward to further metallurgical testwork as well as commissioning of a scoping study in the near-term with a development decision by end of the year. In the meantime, we maintain a Speculative Buy rating on the stock.

Beaufort Securities acts as corporate broker to Savannah Resources Plc.


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