BlueRock Diamonds* (LON:BRD) 2.125p, Mkt Cap £2.9m – Interims highlight ongoing improvement in Kareevlei diamond grades and production
Kefi Minerals* (LON:KEFI) 4.5p, Mkt Cap £15.0m – Interim results and progress report on Tulu Kapi and Saudi Arabia
Georgian Mining* (LON:GEO) 21.625p, Mkt Cap £24.8m – Interim results highlight progress on expanding Kvemo Bolnisi resource
Hummingbird Resources (LON:HUM) 34p, Mkt Cap £117m –Yanfolila continues on time and budget
Dow Jones Industrials -0.05% at 22,284
Nikkei 225 -0.31% at 20,267
HK Hang Seng +0.47% at 27,642
Shanghai Composite +0.05% at 3,345
FTSE 350 Mining +1.20% at 16,586
AIM Basic Resources +0.48% at 2,460
Economics
Currencies
US$1.1741/eur vs 1.1828/eur yesterday. Yen 112.92/$ vs 111.61/$. SAr 13.545/$ vs 13.308/$. $1.339/gbp vs $1.350/gbp. 0.784/aud vs 0.793/aud. CNY 6.636/$ vs 6.631/$.
Commodity News
Precious metals:
Gold US$1,289/oz vsUS$1,308/oz yesterday - Gold prices dip on potential $ rate rise in December
Gold ETFs 69.3moz vsUS$69.0moz yesterday
Platinum US$924/oz vsUS$940/oz yesterday
Palladium US$916/oz vsUS$916/oz yesterday
Silver US$16.83/oz vsUS$17.14/oz yesterday
Base metals:
Copper US$ 6,4680/t vsUS$6,500/t yesterday
EV boom could lead to copper shortage
• Mining group BHP suggests that push towards electric cars could lead to shortage of raw materials as producers struggle to match increased demand
• World’s top mines are aging and no major discoveries in two decades – fully electric vehicles require four times as much copper as combustion engine cars
Aluminium US$ 2,132/t vsUS$2,148/t yesterday
Nickel US$ 10,545/t vsUS$10,580/t yesterday
Zinc US$ 3,131/t vsUS$3,1352/t yesterday - Zinc mine suspensions may remove up to 6,000t from market
Lead US$ 2,480/t vsUS$2,508/t yesterday
Tin US$ 20,705/t vsUS$20,700/t yesterday
Energy:
Oil US$58.2/bbl vsUS$58.9/bbl yesterday
Natural Gas US$2.927/mmbtu vsUS$2.933/mmbtu yesterday
Uranium US$20.60/lb vsUS$20.50/lb yesterday
Bulk:
Iron ore 62% Fe spot (cfr Tianjin) US$64.2/t vsUS$63.8/t
Roy Hill says can expand iron ore beyond target
• Australian iron ore miner Roy Hill Holdings has suggested it has the ability to expand its production capacity beyond the 55 million tonnes it has targeted
• Closing in on 55 million tonnes a year goal as it expects to export at least 4.6million tonnes this month
Chinese steel rebar 25mm US$623.4/t vsUS$622.4/t
Thermal coal (1st year forward cif ARA) US$81.5/t vsUS$83.5/t
Premium hard coking coal Aus fob US$200.6/t vsUS$200.6/t
Lithium – Rosatom, the Russian nuclear company is looking to lithium following the recent collapse in uranium ore prices –
• Clean Commodities Corp announce discovery of distinct lithium rich boulder field
• Completed inaugural field program at its Juliet Lithium project identifying prospective mineralized boulder field with assays up to 1.65% Li20
• Company successfully acquired 2,594 Ha of additional tenure in expansion of the project
Cobalt - Cobalt nanoparticles for making amines cheaply and simply
Demand for cobalt expected to soar due to demand for electric vehicles
• Automakers expect to sell 20 million all electric vehicles in 2030 prompting questions about where raw materials will come from – cobalt is industries weakest link with 65% coming from Democratic Republic of Congo which has some of the most dangerous and environmentally destructive mines
• Automotive companies searching for cobalt suppliers, suggested that there will be new discoveries and production across Canada, US, Chile and Scandinavia
Other:
Tungsten APT European US$310-335/mtu vs US$310-335/mtu
Steel
British steel swoops in on Dutch steel maker in first acquisition since rescue
• British Steel has emerged from the UK’s steel crisis with its first international acquisition
• Acquired FN steel, which employs around 300 people in the west of the Netherlands, where it makes premium wire rods used by many major European car makers
Company News
BlueRock Diamonds* (LON:BRD) 2.125p, Mkt Cap £2.9m – Interims highlight ongoing improvement in Kareevlei diamond grades and production
• BlueRock Diamonds has announced the resignation of Andre Markgraaaf from the board in order pursue other business interests.
• In recompense for Mr Markgraaf’s unpaid service to the company over the last 4 years, the Board is to issue him 752,941 shares, valued at £16,000 at the closing mid-market price of 2.125p on 25th September, “and Andre has agreed to relinquish all of his outstanding options.”
• The company has also announced that “Now that the Company is nearing run rate operating breakeven, the Board has reviewed its composition and its remuneration policy for non-executive directors, who hitherto have received no fees for their work.” BlueRock diamonds also announces its intention “to appoint further board members or senior consultants to provide the expertise that the Company needs in order to achieve its expansion plans.”
• The board has agreed with its individual non-executive directors to cancel the options awarded to them at the time of the company’s AIM admission on the grounds that “these options provide no realistic incentive”, and in addition it has also “agreed to commence the payment of service fees to Tim Leslie and Paul Beck of £12,000 per annum and £24,000 per annum respectively. In order to conserve cash, it has been agreed that these fees will be satisfied in shares a year in advance ("Salary Shares").”
Conclusion: It is encouraging to hear that the company is approaching operating breakeven and that it is seeking to strengthen its board and senior management team. This news comes after recent announcements of improvements in grade, throughput and diamond values and we look forward to this trend continuing as the mine accesses fresh kimberlite ore beneath the overlying calcrete.
*SP Angel acts as Nomad & Broker to BlueRock DiamondsBlueJay Mining* (JAY LN) 18p, Mkt Cap £138m – First agreement signed for World’s highest grade Ilmenite Product
Kefi Minerals* (LON:KEFI) 4.5p, Mkt Cap £15.0m – Interim results and progress report on Tulu Kapi and Saudi Arabia
• Kefi Minerals reports a loss for the six months to 30th June 2017 of £3.56m (2016 loss £1.88m) as it progresses its Tulu Kapi gold project in Ethiopia.
• At 30th June, Kefi Minerals held cash of £1.64m.
• Executive Chairman, Harry Anagnostaras-Adams describes “The first six months of 2017 … [as] a transformational period for KEFI. We have made significant progress at Tulu Kapi, agreeing with our partners both the execution plan to close the required financing and the Project works schedule.”
• He goes on to remark that ““The rest of 2017 is expected to be equally busy as we work to close the Project financing and move towards development.“
• Outlining progress at Tulu Kapi, the company highlights the creation of the new project operating company, Tulu Kapi Gold Mines (TKGM), in which Kefi Mines is expected to hold between 75-80% with the balance held by the Ethiopian Government.
• As previously announced, the financing agreement with Orion, including the US$135m of project funding to finance and operate all the on-site infrastructure at the Tulu Kapi project.has reduced Kefi’s estimated need for additional funding to US$24m from the original US$289m.
• In Saudi Arabia, the company is proceeding with its proposed open-pit heap leach gold operation as a prelude to the possible internally funded development of a carbon-in-leach processing plant.
• At Hawiah, also in Saudi Arabia, the company has identidffied a six-kilometre long precious and base-metals bearing gossan for further follow up as part of the company’s long term strategy to establish an early position “in what will emrge as a world calss minerals province.” The results of a Government review of mining industry regulations and policies in Saudi Arabia “are expected to be published soon.”
Conclusion: Kefi Minerals is pressing ahead with the development of the Tulu Kapi gold deposit alongside its Ethiopian Government partner. We await further developments with interest.
*SP Angel act as Nomad and broker to Kefi Minerals
Georgian Mining* (LON:GEO) 21.625p, Mkt Cap £24.8m – Interim results highlight progress on expanding Kvemo Bolnisi resource
(Georgian’s assets in Georgia are held in a 50:50 joint venture)
STRONG BUY
• Georgian Mining reports an interim loss of £1.08m for the six months ending 30th June 2017 (2016 loss - £0.50m) . The company end the period with a cash balance of £4.26m.
• During the first half, Georgian Mining spent approximately £1.53m on exploration and a further £1.08 on operations funded from existing cash resources and the issue of shares which raised a net £5.20m.
• Exploration has focussed on the Kvemo Bolnisi copper/gold project in Georgia which the company considers “has the potential to host large scale epithermal gold-copper mineralisation”.
• The company has already published an initial JORC resource estimate of “3.154 Mt @ 0.82% Cu and 2.29 Mt @ 0.85 g/t Au”. The company now reports that a target of identifying “3Mt-5Mt of combined copper-gold sulphide and gold oxide mineralisation at KB has been successfully achieved”.
• A third objective is to identify a resource of over 50mt at Kvemo Bolnisi.
• Georgian Mining comments that “Underpinning our confidence are the results of resource drilling which have identified an expanse of mineralisation styles that are consistent with a gold/copper-endowed epithermal system: beginning at surface with
o i) outcropping heap leachable gold oxide mineralisation overlying
o ii) an enriched (supergene) high-grade chalcocite copper blanket; extending into
o iii) copper-gold sulphide mineralisation hosted in breccia pipes that are surrounded by
o iv) lower grade bulk tonnage potential copper-gold sulphides and
o v) high-grade sheeted pyrite-gold epithermal vein-type mineralisation.”
• At this stage, much of the mineralisation identified lies relatively close to the surface and remains open at depth and the company intends to “test the depth extension of the two breccia pipes at GZ2 and CZ1, as the low to intermediate sulfidation epithermal environment that characterises KB has the potential to "blow-out" at depth and contribute to a more substantial bulk tonnage copper-gold resource in line with the 50Mt+ being targeted by the Company.”
• In addition to the immediate prospects at Kvemo Bolnisi, Georgian Mining continues to generate “Further gold oxide and copper-gold sulphide targets across the licence area”. These new targets will be drilled during the current programme.
Conclusion: Georgian Mining is continuing to expand its exploration horizons within its Georgian licence areas. The currently identified resources remain open at depth, additional targets are being generated and the company is well placed to establish its 50+mt resource objective.
*SP Angel acts as Nomad and Broker to Georgian Mining.
Hummingbird Resources (LON:HUM) 34p, Mkt Cap £117m –Yanfolila continues on time and budget
• Hummingbird Resources reports a loss of $2.6m for the six months to 30th June 2016 (2017 – loss $2.7m) as it develops its Yanfolila gold project towards initial gold production by the end of 2017.
• The company reports that the project remains both on schedule and within budget and that pre-production mining has now started and installation of the ball mill is now well advanced with the shell now successfully installed.
• The company has, as previously reported, increased its interest in the project from 75% to 80% with the Mali Government holding 20% following its acquisition of a further 10% interest for US$11m. In addition, the company has successfully acquired an outstanding 1% royalty interest held by La Petite Mine d’Or for $1m.
Conclusion: The Yanfolila project remains on track to produce gold by the end of 2017. Key critical path objectives have now been achieved and although, no doubt a significant amount of work still remains we look forward to the successful completion of Mali’s latest new gold mine.