SP Angel . Morning View . Tuesday 14 02 23
Lower US$ helps gold and copper ahead of inflation data
MiFID II exempt information – see disclaimer below
Aura Energy Ltd (ASX:AEE, AIM:AURA)* – Updated resource estimate for Tiris
B2Gold Corp. (TSX:BTO) takes over Sabina Gold & Silver in an all-equity C$1.1B deal further diversifying its asset base and adding a development project in Canada
BlueJay Mining PLC (AIM:JAY, OTCQB:BLLYF)* – Strategic review and $6m share subscription agreement
Celsius Resources Ltd (ASX:CLA, AIM:CLA)* – COO appointment
Gemfields Group Limited (AIM:GEM) – Insurgent action in Mozambique
Jindalee Resources Ltd (ASX:JRL) – MoU Agreement with POSCO Holdings for McDermitt Lithium Project, USA
Mkango Resources Ltd (AIM:MKA, TSX-V:MKA, OTC:MKNGF)* – CEO buys ~£100k worth of stock
SolGold PLC (LSE:SOLG, TSX:SOLG, OTC:SLGGF)* – Progress of the DFS at Cascabel and Porvenir PEA slows. Alberta court paves way for completion of the Cornerstone acquisition
Pre-IPO opportunity in Zambian copper exploration company holding four licenses in highly prospective areas close to existing mines.
- Licenses are located in highly prospective areas close to existing and historic mines. All licenses are 100% owned.
*SP Angel’s role is limited to making introductions and interested parties should be aware that investment in a private company can present certain risks not present in listed companies (e.g. limited or no liquidity and no rules compelling disclosure of information to investors). This offer is open to professional investors only and is not offered to retail investors
Gold continues to cool as traders prepare for today’s US inflation data
- Gold prices slid again to $1,860/oz, now down over $100/oz over the past 10 days.
- The metal has reverse in line with the dollar, which has bounced over 3% from May 2022 lows.
- ETFs have been selling gold in line with an uptick in US Treasury yields, which have climbed 30bp in the aftermath of a major US non-farm payroll beat two Fridays ago.
- The market now focuses on today’s US CPI data, with Fed policymakers stuck between a hard place, with strong consumer credit data and a hot labour market running in parallel to elevated inflation.
- Additional Fed policymakers have joined in calls for higher rate hikes for longer in recent weeks, with Fed Governor Bowman stating the Central Bank needs to ‘further tighten monetary policy to bring inflation down toward our goal.’
- The consensus suggests US CPI data will come in at 6.2% this afternoon, with a 0.5% acceleration in January vs December’s 0.1%.
- Analysts expect 6.2% or lower to push both gold and equities higher, whilst 6.5% or higher will likely weigh on gold and support the dollar’s recent upwards momentum.
China yet to record major spike in commodity inventories despite rapid fiscal reopening
- Data points are suggesting that China’s reopening is beginning to accelerate, despite an easing of commodity prices across the board.
- China recorded a tripling of new bank loans in January to 4.9tn CNY vs December’s 1.4tn.
- The increase is expected by analysts to feed into infrastructure and construction spending going forward, supporting metals demand.
- However, consumers remain conservative, with new vehicle sales falling 35% in January yoy. (Reuters)
- Copper imports remain muted, following a 6.2% rise in 2022 to 5.87mt. Inventories have been rising since the end of December and refined premiums for imports remain muted, suggesting that end users have ample domestic supply at current utilisation rates.
Japanese zinc smelting giant hikes fees 10% as refined supply tightens
- Mitsui Mining & Smelting has hiked Asia ex-Japan premiums to LME prices by over 10%.
- The smelting house expects another zinc deficit this year following a market shortfall of c.300kt in 2022. (International Lead and Zinc Study Group)
- The fee hike is smaller than US and European smelters, however, as Asian demand remains weak, and China is yet to fully regain steam.
- The Company expects prices to remain rangebound between $3,000/t and $3,400/t, well below last year’s $4,500/t peak.
Potash - Middle Eastern fertiliser major expects nitrogen demand to climb on food security concerns
- Fertiglobe expects nitrogen demand to climb above average levels through 2025 and supply to remain tight.
- Nitrogen prices have fallen in line with other fertiliser products, including potash.
- However, Fertiglobe expects nitrogen supply to tighten between 2023 to 2027.
- Wheat prices hit a 2-month high today over concerns of further escalations between Russia and Ukraine, with shipments from the Black Sea running at c.30% of previous seasonal levels.
Nickel - Trafigura nickel trades part of systemic fraud which could cost >$0.5bn
- Trafigura has allegedly been had by fraudsters in relation to nickel cargos from companies associated with Prateek Gupta
- The ‘transit finance’ cargos were often sold back to Gupta or Gupta linked companies.
- Problem is that the nickel which was supposed to be in the containers was not there.
- Gupta is reported to have offered to settle the outstanding amount over time.
- Trafigura decided to take the matter to court winning a $625m freezing order against Gupta and his companies.
- Trafigura has sold around $100m of the Gupta cargos onto other companies causing further disruption in the market.
- We recommend more cargos are checked and double checked with trustworthy inspectors in future.
Aluminium climbs from 5-week lows as concerns over US and China tensions mount
- Aluminium prices have bounced 1.3% to over $2,400/t following a multi-week sell off triggered by weaker-than-expected Chinese demand.
- The bounce has been triggered by supply concerns, with smelters in Yunnan reportedly being forced to limit output on limited hydropower.
- Geopolitical tensions between the US and China over balloons follows the US Customs Agency’s decision a fortnight ago to seize Chinese aluminium products on concerns over forced labour.
Dow Jones Industrials +1.11% at 34,246
Nikkei 225 +0.64% at 27,603
HK Hang Seng -0.16% at 21,131
Shanghai Composite +0.28% at 3,293
Economics
US – Inflation data day.
- Headline CPI expected to come in at 0.5%mom/6.2%yoy in January.
- Core CPI expected at 0.4%mom/5.5%yoy
Japan – PM Fumio Kishida nominated Kazuo Ueda as a new BOJ Governor in a move likely to bring a gradual reduction in the monetary stimulus, Bloomberg writes.
- Ueda is a university professor and former BOJ board member with a doctorate from MIT dubbed as “Japan’s Ben Bernanke”.
- Ueda has not voted on the policy since 2005 that in turn makes him a neutral successor with no long running attachment to the current stimulus setup.
- The yen and yields climbed on the surprise nomination with markets now expecting policy changes likely to come sooner than previously thought.
- Separately, Q4 GDP came in significantly lower than forecast driven by weaker business spending, stronger inventories’ drawdown and lower growth in trade.
- Q4 GDP (%qoq): 0.6 v -0.8 Q3/22 and 2.0 est.
UK – Better than expected labour market data adds further pressure on the central bank to continue with monetary tightening.
- New jobs came in stronger than forecast while core labour earnings picked up further.
- Payrolled Employees Monthly Change: 102k v 28k December and 15k est.
- Average Weekly Earnings (3m %yoy): 5.9 v 6.4 November and 6.2 est.
- Weekly Earnings ex Bonus (3m %yoy): 6.7 v 6.4 November and 6.5 est.
- Brexit deal draws closer as UK dilutes resistance to European court ruling on issues in Northern Ireland.
- Rishi Sunak is due to speak to certain European leaders this week to agree new Brexit deal on Northern Ireland (The Telegraph)
- A new system of ‘red’ and ‘green’ lanes will ensure goods destined for Northern Ireland from mainland UK will not face physical checks.
South Africa declares National State of Disaster as flooding hits seven provinces
- The La Nina phenomenon has caused heavy rainfall across South Africa, with Mpumalanga and the Eastern Cape the most affected.
- The government has triggered the national disaster act, with the national police and defence force being called in to help respond.
Russia – US warns citizens to get out of Russia immediately
- Russian security services are arresting Americans on spurious charges.
- The message is to get out now while you can.
- We suggest all Brits and other Europeans leave before they get strapped onto the front of Russian tanks in the Donbas or worse.
- Hostage diplomacy is particularly unpleasant when combined with Russian jails.
99 Red Balloons song by Nena forecast recent geopolitical events so long ago
https://www.youtube.com/watch?v=hiwgOWo7mDc&ab_channel=NENA
Currencies
US$1.0739/eur vs 1.0677/eur yesterday. Yen 131.94/$ vs 132.41/$. SAr 17.832/$ vs 17.792/$. $1.216/gbp vs $1.205/gbp. 0.697/aud vs 0.692/aud. CNY 6.818/$ vs 6.827/$.
Dollar Index 103.13 vs 103.71 yesterday.
Commodity News
Precious metals:
Gold US$1,860/oz vs US$1,871/oz yesterday
Gold ETFs 92.9moz vs US$93.0moz yesterday
Platinum US$958/oz vs US$943/oz yesterday
Palladium US$1,551/oz vs US$1,519/oz yesterday
Silver US$21.86/oz vs US$22.21/oz yesterday
Rhodium US$12,100/oz vs US$12,100/oz yesterday
Base metals:
Copper US$ 8,959/t vs US$8,878/t yesterday
Aluminium US$ 2,420/t vs US$2,441/t yesterday
Nickel US$ 26,500/t vs US$26,982/t yesterday
Zinc US$ 3,086/t vs US$3,025/t yesterday
Lead US$ 2,094/t vs US$2,078/t yesterday
Tin US$ 27,250/t vs US$27,349/t yesterday
Energy:
Oil US$86.3/bbl vs US$85.6/bbl yesterday
- Crude oil prices remain rangebound despite confirmation of US plans to sell 26mb of crude from its Strategic Petroleum Reserves over 2Q23, which was mandated by Congress as part of 2015 legislation.
Natural Gas US$2.468/mmbtu vs US$2.533/mmbtu yesterday
Uranium UXC US$50.55/lb vs US$50.50/lb yesterday
Bulk:
Iron ore 62% Fe spot (cfr Tianjin) US$121.0/t vs US$125.1/t
Chinese steel rebar 25mm US$613.1/t vs US$618.0/t
Thermal coal (1st year forward cif ARA) US$133.0/t vs US$133.0/t
Thermal coal swap Australia FOB US$209.0/t vs US$192.0/t
Coking coal swap Australia FOB US$349.0/t vs US$325.0/t
Other:
Cobalt LME 3m US$38,920/t vs US$38,920/t
NdPr Rare Earth Oxide (China) US$105,222/t vs US$106,446/t
Lithium carbonate 99% (China) US$60,934/t vs US$61,089/t
China Spodumene Li2O 5%min CIF US$5,970/t vs US$5,970/t
Ferro-Manganese European Mn78% min US$1,326/t vs US$1,325/t
China Tungsten APT 88.5% FOB US$333/mtu vs US$333/mtu
China Graphite Flake -194 FOB US$865/t vs US$865/t
Europe Vanadium Pentoxide 98% 10.0/lb vs US$9.9/lb
Europe Ferro-Vanadium 80% 38.55/kg vs US$38.25/kg
China Ilmenite Concentrate TiO2 US$344/t vs US$345/t
Spot CO2 Emissions EUA Price US$95.7/t vs US$94.6/t
Brazil Potash CFR Granular Spot US$502.5/t vs US$510.0/t
Company News
Aura Energy Ltd (ASX:AEE, AIM:AURA)* 19.25p, Mkt Cap £95m – Updated resource estimate for Tiris
- Aura Energy has reported an increased mineral resources estimate for its Tiris uranium project in Mauritania.
- The new estimate, which follows an infill drilling programme, increases the overall resource to 58.9m lbs of contained U3O8 within 113mt at an average grade of 236ppm U3O8.
- The new estimate total Measured, Indicated, and Inferred resource, reported at a cut-off grade of 100ppm U3O8, compares with a pre-existing, February 2022, estimate of 102.1mt at a higher average grade of 253ppm.
- The Measured and Indicated portion of the resource (62.1mt at an average grade of 216ppm) is approximately 55% of the overall resource tonnage with the Sadi deposit (29.2mt at an average grade of 206ppm) containing approximately 26% of the overall tonnage with a further 16% in each of the Hippolyte North and Lazare South deposits.
- The Hippolyte Marie and West deposit with only around 7% of the overall tonnage is the highest grade of the individual deposits with an overall grade of 310ppm.
- The company explains that the new resource estimate “enables Aura to update the 2019 Tiris Definitive Feasibility Study (DFS) project work, assessing the potential to increase the production rate based on the increased M&I resource. This work is expected to be released before the end of Q1 2023”.
- The 2019 study envisaged an operation which produced an average of “800,000 lbs U3O8 per year with a capital cost of USD 74.8 million and C1 costs of USD 25.43/lb U3O8”.
- Aura Energy has previously discussed the possibility of increasing annual production rates to 3-5m lbs within the first five-years of operations depending on the scale of the available mineral resources.
- Managing Director, Dave Woodall, confirmed Aura Energy’s confidence in the expansion potential of the Tiris project and that the company’s “immediate focus is now to work with our Mauritanian stakeholders, offtake providers, investors and financing partners to progress towards a decision to Mine in Q3 CY2023, a target construction timeline of Q4 CY2023, and first production expected in late 2024 or early 2025”.
- Today’s announcement explains that all of the resource zones lie beneath flat land surfaces covered by surficial hamada (sand and outwash fan material) and thin aeolian sand deposits with mineralisation “within weathered, partially decomposed red granite or in colluvial gravels developed on or near red granites ” and beneath thin surface cover which we believe should contribute to simple and low-cost mining “with little or no crushing” required.
- The company’s announcement confirms that mineralisation, in the form of the mineral carnotite, “is mostly ultrafine, micron scale in grain size enabling the separation of the uranium without crushing and grinding as demonstrated in the 2019 DFS”
Conclusion: Increased mineral resources provide a platform for higher production rates than originally planned from the Tiris project. The company expects to make a decision on proceeding with the Tiris project in Q3 2023 and moving towards initial production in late 2024 or early 2025.
*SP Angel acts as Nomad and Broker to Aura Energy
B2Gold Corp. (TSX:BTO) takes over Sabina Gold & Silver in an all equity C$1.1B deal further diversifying its asset base and adding a development project in Canada
- Companies signed a definitive agreement yesterday pursuant to which B2Gold will issue 0.3867 of its shares in return for each Sabina share.
- This represents consideration of C$1.87/sh based on the closing price of B2Gold as of Friday last week.
- The consideration represents a premium of 45% to the closing price of Sabina as of February 2, the date the non-binding letter of intent was signed.
- Sabina develops the high grade, fully permitted and construction ready Black River Project in Nunavut, Canada.
- The FS completed in Mar/21 envisaged C$610m capex for a conventional open pit/underground 4ktpd CIP operation producing ~220kozpa at US$775/oz AISC over 15 year life of mine and delivering C$1.1B and 28% in post tax NPV5% and IRR at US$1,600/oz gold price (C$1.6B and 35% at $1,900/oz).
- The project hosts 18.7mt at 5.97g/t for 3.6moz in reserves and 47.2mt at 6.04g/t for 9.2moz in total resource.
- With an estimated average head grade of ~6.0 g/t gold, the project ranks among the highest-grade undeveloped gold projects globally.
- First gold production is targeted for Q1/25.
- The project includes ~58,400ha in mining leases and claims with a series of exciting exploration targets along the 80km long trend
- At the Goose project, all deposits (Goose, Echo, Umwelt, Llama, and Nuvuyak) are open along the eight kilometres of iron formation, providing considerable potential for mine life extension.
- At the George project (~50 km from the Goose project), over 20 km of iron formation (nearly triple the iron formation length of the Goose project) represents a highly prospective area to expand existing mineral resources.
- B2Gold is planning a significant exploration campaign for the district over the next few years.
BlueJay Mining PLC (AIM:JAY, OTCQB:BLLYF)* 3.85p, Mkt cap £40m – Strategic review and $6m share subscription agreement
Valuation 12.3p
- Bluejay Chairman, Rob Edwards has reviewed the portfolio within Bluejay for its value and potential concluding the portfolio is best kept within the group.
- Capital raising: US$6m with first $2m being used to fund drilling at Kangerluarsuk
- The Company has agreed a $6m subscription agreement with a US investor which could lead to the issuance of variable number of shares according to the prevailing share price
- Key assets:
- Dundas Ilmenite Project (100% owned, Greenland)
- Disko-Nuussuaq Ni-Co-PGM Project and the (Kobold jv, Greenland)
- Kangerluarsuk (100%, Greenland) polymetallic opportunity in West-Greenland, in particular the Kangerluarsuk Zn-Pb-Ag project where Bulejay will drill this year
- Enonkoski Ni-Cu-Co Project (100% owned, Finland)
- Hammaslathi (100% owned, Finland) Ni-Co-PGM licence in Finland, we believe, for relatively modest expenditure, Bluejay may also be able to generate positive, meaningful, progress.
- Outokumpu Copper-Zinc-Cobalt-Nickel-Gold-Silver Project.
- Thunderstone Gold & Base Metals Project.
- Greenland: According to Edwards, the minerals industry is fast developing and mining in Greenland is achieving wider acceptance.
- Dundas: Covid delayed the concentrating of 42,000t of ore from Dundas work from Dundas along with work at Dundas in Greenland.
- Ilmenite concentrate has since been shipped to potential customers supporting the current offtake agreement and potential new offtake discussions
- Optimisation: The good thing about Covid is that many projects have discovered new value through re-optimisation.
- The re-engineering of the Dundas concentration plant for the new Feasibility Study is now said to have significantly lowered the risk, time to construction and cost of the plant.
- The use of dry-dock barge-based infrastructure, built and commissioned off-site offers significant benefits while changing the mining method to simple bulldozing onto a conveyor system should cut both capex and opex costs on the mining front.
- Assays from drilling to confirm and enhance the quality of the mineral resource are due and will hopefully support the Dundas Feasibility Studym, though the number of changes mean that a new PFS will be done first.
- A new Feasibility Study is now due by mid-2024 latest by which time the cost of certain capital equipment might have returned to normal.
- Edwards quotes average capex costs having risen between 25% to 30% last year but we reckon optimisation should offset much of this.
- Higher ilmenite prices should also add value to the project in our view.
- A lack of new projects combined with falling grades at other ilmenite mines which are nearing the end of their lives makes Dundas increasingly important to offtakers and new customers.
- Disko-Nuussuaq (Greenland), the Nickel-Copper-Cobalt-Platinum Group Metals project in Greenland should see first drilling this year following two years of exhaustive analysis.
- Nature has swept much of the ice cover away exposing more bare rock and cliff faces giving better indication as to where the super-high-grade nickel boulder came from.
- Geology is so often like following a trail of breadcrumbs as the geologists simply trace their way to the source.
- Kobold Metals committed $15m to exploration meaning this should be a big year for the project at least in terms of expenditure.
- Kangerluarsuk Zinc-Lead-Silver ± Copper Project. Drilling will start this summer to test what sound like some pretty clear targets.
- The area indicates potential for a base metal project with scale as indicated by outcropping mineralisation along a 5km discovery zone showing yield chip sample results of up to 1m grading 41.1% Zn, 0.4m at 45.4 % Zn and grab rock samples showing up to 9.3% Pb, 1.2% Cu and 596g/t silver.
- The area also hosts the former Black Angel lead, zinc, silver mine which produced >11mt grading 12.6 % Zn, 4.1 % Pb and 29g/t silver from 1973-1986 and 1986-1990
- “Kangerluarsuk licenses host the strongest cluster of stream sediment zinc anomalies in Greenland, with samples up to 2,200 ppm Zn.”
- Thunderstone Gold & Base Metals Project. Management have cut the license area to focus on the most prospective areas for gold and base metals and aim to focus on advance targets.
- Finland: a tier 1 mining jurisdiction.
- There is no doubt the historic mines at Hammaslathi and Enonkoski contain base and precious metals.
- Defining further resources within Hammaslathi and Enonkoski should be relatively straightforward it’s more about the scale and the unit cost of extraction as Finland is not a cheap place to operate in.
- Enonkoski Nickel-Copper-Cobalt Project. Rio Tinto has committed $20m to the joint venture to continue exploration and drilling at and along strike from the historic Enonkoski polymetallic mine following much mapping, sampling and drilling..
- Hammaslathi Copper-Zinc-Gold-Silver Project. Drill targets ready for drill-testing with all known ore-lodes open down-plunge.
- The Drilling into the E-lode shows 8.65m grading at 2.15% Cu, 1.97% Zn, 47.46 ppm Ag and 0.5 g/t Au indicating greater potential to come.
- Outokumpu Copper-Zinc-Cobalt-Nickel-Gold-Silver Project. The team are focussing on gaps in previous exploration to see if they can discover another high-grade Outokumpu type target.
- Black Shales (Finland) Nickel-Zinc-Copper-Cobalt Project Divestment. Bluejay previously agreed to sell the Paltamo and Rautavaara Nickel-Zinc-Copper-Cobalt licenses in Finland, known as the Black Shales Ni-Zn-Cu-Co Project to Metals One PLC for a combination of cash and shares.
- The consideration is now worth £4.125m assuming Metals One lists on AIM or some other market.
- Bluejay Share subscription agreement:
- Bluejay Mining report an agreement to sell up to US$6m worth of stock to a US-based investor via a subscription deal.
- The Subscription will initially raise US$2m unconditionally, with the first tranche of investment expected to occur next week
- Following the First Tranche, the second conditional tranche of the Subscription will be expected to occur no later than 12 months hence. If required by the Company, a third conditional tranche of US$2m is also available, with the consent of the Investor.
- The Subscription will fund a summer drill programme at Kangerluarsuk and the Company's general working capital needs.
- The Company will issue Subscription Shares, at the Investor's request, within 36 months of the date of the related prepayment.
- The number of Subscription Shares issued by the Company will be determined by applying the Purchase Price formula to the subscription amount subject to a Floor Price.
- The Purchase Price of the Subscription Shares will be equal to 10 pence per share initially. Subject to the Floor Price, described below, after an initial month, the Purchase Price will reset to the average of the five daily volume-weighted average prices selected by the Investor during a specified period immediately prior to the date of the Investor's notice to issue Subscription Shares, less a 10% discount, rounded down to the nearest one tenth of a pence if the share price is at or below 20 pence, half of a pence if the share price is at above 20 pence and at or below 50 pence, or a whole pence if the share price is at above 50 pence.
- The Company will have the ability to reduce the above discounts by approximately 30% (i.e. from 10% to 7%) if the Company meets a stipulated ESG Milestone.
- The ESG Milestones that would qualify the Company for such a reduction could include energy saving and fuel reduction requirements at both the Dundas Ilmenite Project and in field operations work.
- In addition, the Company may benefit from share price appreciation following issuance of Subscription Shares. If an issuance of Shares to the Investor would result in the effective discount to the prevailing market price of the Company's Shares being in excess of 25%, the Purchase Price will be increased by half of such excess.
- The Purchase Price will be the subject of the Floor Price of 2.5 pence per share. If the Purchase Price formula results in a price that is less than the Floor Price, the Company may forego issuing Subscription Shares and instead opt to repay the applicable subscription amount in cash (with a 5% premium), subject to the Investor's right to receive Subscription Shares at the Floor Price in lieu of such cash repayment. The Purchase Price will not be the subject of a cap.
- The Company will make an initial issuance of 5.8m Subscription Shares to the Investor at the time of the funding of the First Tranche, towards the ultimate number of Subscription Shares to be issued.
- Alternatively, in lieu of applying these Shares towards the aggregate number of the Subscription Shares to be issued by the Company, the Investor may make a further payment to the Company equal to the value of these Shares determined using the Subscription Price at the time of the payment.
- The Company has agreed to issue 3,798,911 new ordinary Shares at 4.73p/s in satisfaction of a fee payable to the Investor.
- Following Admission, the Company will have 1,059,313,658 Shares in issue with each Share carrying the right to one vote.
- See RNS statement for further details.
- Valuation: We have cut our valuation to 12.3p/s to reflect the increased number of shares to be issued via the subscription at a base price of 2.5p/s and a higher NPV discount rate of 10% to reflect a degree of uncertainty over the capital and operating cost to come from revisions to the PFS on the Dundas mine.
- We do not currently apportion any value to Bluejay for exploration at Disko, Kangerluarsuk, Thunderstone, Enonkoski, Hammaslathi, Outokumpu and the Black Shales.
Conclusion: Edward’s exhaustive review on Bluejay assets highlights a broad range of value opportunities. Renewed energy and focus should start to show results with much drilling planned this year. While some drill cores might generate visual excitement as they emerge from the ground others will require assay.
We are disappointed to see the company sign up a share subscription agreement and hope the team will be able to add value faster than the investor ‘Towards Net Zero, LLC’ is able to sell new Bluejay Mining stock.
*SP Angel acts as nomad and broker to Bluejay Mining. The analyst holds shares in Bluejay Mining
Celsius Resources Ltd (ASX:CLA, AIM:CLA)* 0.9p, Mkt Cap £16.7m – COO appointment
- Celsius Resources, has announced the appointment of a New Zealand trained mining engineer, Mr. David Way as a Chief Operating Officer as it advances the development of the Company's flagship Maalinao-Caigutan-Biyog (MCB) Copper-Gold Project.
- Mr. Way has “more than 30 years' experience in the operation and management of both underground and open-pit mines across several commodities and jurisdictions”, including as General Manager at “OceanaGold's Didipio Mine in the Philippines” as well as at Newcrest Mining’s Gosowong gold operation in Indonesia.
- Chairman, Julito R Sarmiento, welcomed the appointment and expressed confidence that Mr. Way’s “immense talent, people skills, mining expertise, and above all, his vision, values and passion which align completely with the Company … [would complement] … the in-country team … [and position it to] … realise our strategy of a 'green mine' for the MCB Project”.
*SP Angel acted as broker to Celsius Resources with respect to its AIM IPO.
Gemfields Group Limited (AIM:GEM) 17.5p, Mkt Cap £221m – Insurgent action in Mozambique
- Gemfields reports that insurgents in the Mozambique province of Cabo Delgado attacked the village of Nairoto on Sunday
- The village is located “approximately 15km south west of the exploration camp of Nairoto Resources Limitada ("NRL"), in which Gemfields owns 75%; and (ii) approximately 83km north of Montepuez Ruby Mining Limitada ("MRM"), in which Gemfields also owns 75%”.
- As a result of the insurgent action, the company “has initiated the process of evacuating operational employees and contractors, and therefore operations at the site have ceased”.
- Gemfields confirms that “There is no present impact on operations” at the Montepuez mine where insurgent action in October last year triggered a temporary evacuation of personnel.
Jindalee Resources Ltd (ASX:JRL), A$2.7, Mkt Cap, A$150m - MoU Agreement with POSCO Holdings for McDermitt Lithium Project, USA
- Jindalee Resources has signed a Non-Binding Memorandum of Understanding with Korean conglomerate POSCO.
- The two parties are looking to undertake joint research to optimise the flowsheet for ore processing at the McDermitt Lithium Project.
- Jindalee will utilise POSCO’s research facility in South Korea, with POSCO already analysing smaller samples of McDermitt ore last year.
- The Companies will explore three different metallurgical processing options at the cost of A$2m, funded by POSCO.
- The McDermitt Project is located in Oregon, where drilling highlighted broad widths of sediment hosted lithium mineralisation, lying flat within 100m of surface and
- The project hosts an Indicated and Inferred Mineral Resource of 1.43Bt at 1,320ppm Li for 10.1Mt LCE.
- Previous metallurgical testing has shown that McDermitt’s ore is amenable to beneficiation in addition to high lithium recoveries from sulphuric acid leaching at low temperatures and atmospheric pressure.
- Bradda Head Lithium (BHL LN) holds a MRE for its Basin Project sedimentary deposit of 371kt of LCE in Arizona.
Mkango Resources Ltd (AIM:MKA, TSX-V:MKA, OTC:MKNGF)*13p, Mkt Cap £28m – CEO buys ~£100k worth of stock
- William Dawes, CEO, acquired 800k shares in two tranches including 400k at 12.95p and 400 at 12.75p.
- Following the purchase of the shares, Dawes holds 9.5m shares or 4.4% in the Company.
*SP Angel acts as nomad and broker to Mkango Resources
SolGold PLC (LSE:SOLG, TSX:SOLG, OTC:SLGGF)* 14.16p, Mkt Cap £355m – Progress of the DFS at Cascabel and Porvenir PEA slows. Alberta court paves way for completion of the Cornerstone acquisition
- In its interim report for the six months to 31st December 2022, Solgold reports a loss of US$17.7m (H1 2021 – US$17.9m loss) and a 31st December 2022 cash balance of US$77.2m.
- Solgold has concentrated on “preliminary work associated with the Cascabel Definitive Feasibility Study (“DFS”) and the Porvenir Preliminary Economic Assessment” in Ecuador and the company comments that both projects “have been delayed … [as a result of] … the evolving capital cost environment, and the numerous values enhancing opportunities under review”.
- The company confirms that negotiations with Ecuador’s Ministry of Energy & Mines on the exploitation agreement for Cascabel started in December 2022 and are continuing.
- Among the financial highlights of the period, Solgold comments on the December 2022 placing of 180m new shares, including 155m to Jiangxi Copper and 23m to Maxit Capital which raised US$36m (gross) and on the royalty financing agreement with Osisko Gold Royalties (TSX:OR) which raised US$50m in December.
- The 7th October 2022, US$107.9m agreement with Cornerstone Capital to consolidate the ownership of the Cascabel Project via Solgold’s acquisition of Cornerstone received the approval of the Alberta court in January and “the Company expects to publish the prospectus shortly and complete the Acquisition soon thereafter with the issue of SolGold shares to Cornerstone Shareholders”.
- At Cascabel, drilling continued at the Tandayama-America, which hosts Measured and Indicated resources of 528.5mt at an average grade of 0.24% copper and 0.19h/t gold, and Moran prospects with a single rig operating at each site to complete 1,568m at Tandayama-America and 818m at Moran during the final 3 months of 2022.
- Elsewhere in Ecuador, Solgold continued drilling at its wholly-owned Amarillo project located 30km south-east of the Alpala deposit at Cascabel with “Three drill holes … completed at the Varela target, Rio Amarillo project, with a total of 3,743 m drilled … [intersecting] … variable content of sulfides such as chalcopyrite, pyrite and molybdenum” and the first hole reporting 72m at an average grade of 2.16g/t gold and 12m at an average grade of 1.35g/t gold in the second hole. The third hole “did not report any significant intersection”.
- At Solgold’s Helipuerto project in south-east Ecuador and adjacent to Solaris Copper’s Warintza deposit, “Exploration completed in the area south-east of the Warintza South defined a new target named Juank, delineating a multielement anomaly of 900m x 700 m”.
- Also in southern Ecuador, work has started to prepare a Preliminary Economic Assessment (PEA) on the Porvenir deposit where Solgold has identified an ‘Indicated’ resource of 396.8mt at an average grade of 0.35% copper and 0.14g/t gold with an additional ‘Inferred’ resource of 96.9mt at an average grade of 0.29% copper and 0.12g/t gold.
- The Porvenir resource “includes strong grades exposed at surface over a 650m long strike length, which is naturally presented for the early years of mining. Open Pit Optimisation studies … show that this near-surface zone approximately equates to a potential starter pit of 44.0Mt grading 0.64% CuEq (0.44% Cu, 0.34g/t Au) with a low strip (waste to ore) ratio of 0.61.”
- Solgold confirms that “Exploration activity will continue at the Company’s priority projects during the current financial year. Extensive and systematic geological and geochemical field programmes are underway and priority drill targets are expected to be ranked and drill ready. The Company will also continue the process to identify potential JV/earn-in partners over select 100%-owned early-stage exploration projects”.
Conclusion: Court approval of the arrangements for the acquisition of Cornerstone Capital Resources clears the way for consolidation of ownership at Cascabel and the future development of the Alpala deposit in Ecuador where a pre-feasibility study was released in April last year and more detailed definitive feasibility work is underway.
*SP Angel acts as Financial Advisor to SolGold
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Sources of commodity prices
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