Today's Market View - Global central banks accelerate gold buying spree

Proactive Published 24/04/2019

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SP Angel – Morning View – Wednesday 24 04 19

Global central banks accelerate gold buying spree

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Altus Strategies* (LON:ALS) – JV term sheet signed on gold projects in Liberia and Cameroon

Antofagasta (LON:ANTO) – Q1 production maintains guidance as copper output increases

Bushveld Minerals (LON:BMN) - Vanadium prices look up following recent correction

Centamin (LON:CEY) – Q1 Production and exploration update

Petropavlovsk (LON:POG) – Annual accounts and Q1/19 production update

Sunrise Resources PLC (LON:SRES) –Nevada project updates

US reported to be using Iran to punish China for supporting Venezuela

The US is to sanction any firm that buys Iranian oil from 1st May ending a six- month waiver allowing Iran’s eight largest buyers of crude to continue to import limited volumes.
China sees this a potential punishment for their support of Venezuela
The recent arrival of Russian, Chinese and Iranian planes in Venezuela appeared to support the Maduro government in Venezuela against US interests.
Chinese support for Maduro presents a serious threat to US – China relations with sanctions over Iranian oil being used as a lever to persuade China to back off.
If this does not work then the US may move to restrict the sale of computer chips to China.
If China does not back off then further escalation of trade tensions may delay US-China trade negotiations causing base metals to fall and gold prices to rise.
The US also sees Chinese lending practices to countries in Latin America as predatory on Pompeo trip around South America
This should help Anglo Asian Mining*, and other gold producers

*SP Angel acts as Nomad & broker to this company.

Distributed Ledger technology gives end-to-end traceability

Grouped 3TG, tantalum, tin, tungsten and gold frequently follow a hazardous and unethical path from mine to factory, sourced from mines whose profits flow to violent militias, criminals, and even terrorists.
With pressure from human-rights groups, miners could turn to start-up technologies such as Minespider to better track shipments of metals as they move along the global supply chain. Blockchain offers an irrefutable database, which is infinitely expandable to accommodate new entries.
CEO Nathan Williams has adapted the technology to create files that can be associated with gold ingots, pallets of tin or truckloads of tantalum and tungsten as QR code labels.
“There’s a shift,” Williams says, “from the concept of ‘I can sell metal anonymously’ to ‘I must include a story with my metal.’ ”
Ford Motor Co. have also teamed with IBM, China’s Huayou Cobalt, and LG Chem to use blockchain to trace and verify ethically sourced cobalt.
Minespider recently partnered with Volkswagen AG on a pilot to help the automaker batter track its minerals supply.
The technology extends into diamonds, with De Beers Group, which dominates the $17.5bn industry, starting Tracr – a blockchain-based platform to follow diamonds from the mine to the engagement ring.
London start-up Everledger is tracking diamonds from the rough to the retailer using another blockchain system, which stores data on a stone’s provenance, size, colour, and cuts in certificates, pictures, and videos. So far the company has files on more than 2m diamonds.
Minespider is in talks with two West African countries to establish blockchain-powered purchasing centres aimed at cutting into the black market by paying gold miners electronically. This action will help increase transparency as buyers consolidate lots before moving them up the supply chain.
The concept aims at helping miners, who’d benefit from better working conditions associated with more formal production, and companies, which would have greater assurances that the metals come from sustainable mines that treat their workers well.
This technology could be particularly useful for African Battery Metals* and IronRidge Resources* which are based in Africa and have cobalt and gold assets.

*SP Angel acts as Nomad & broker to these companies.

Dow Jones Industrials

+0.55%

26,656

Nikkei 225

-0.27%

22,200

HK Hang Seng

-0.45%

29,827

Shanghai Composite

+0.10%

3,202

FTSE 350 Mining

+0.01%

20,675

AIM Basic Resources

-0.00%

2,060

Economics

US – The S&P 500 hit an all-time high overnight on the back of good corporate earnings.

The index closed at 2,934, 3 points above its previous peak in September, with healthcare, technology and consumer discretionary among top performing sectors on Tuesday.
US/China trade talks are due to resume on April 30 as US Trade Representative and treasury Secretary are planning a visit to Beijing.
Talks starting next Tuesday “will cover trade issues including intellectual property, forced technology transfer, non-tariff barriers, agriculture, services, purchases and enforcement,” the White House said in a statement.

Germany – Business confidence unexpectedly worsened in April on Ifo numbers.

The index dropped to 99.2 this month missing market estimates for an increase to 99.9.
The euro extended its decline against the US$ following the report and was down 0.2%.

France – Confidence among manufacturers slipped to the weakest in nearly four years in April casting doubt over the economy’s recovery from the disruption of the Yellow Vest protests.

The confidence gauge fell to 101.1 in April bringing it closer to the long term average of 100 and the lowest level since Jun/15, according to Insee numbers.

Colombia – ‘communities not important’ according to a former president of the Colombian Mining Association in a leaked video on Twitter

A video has been leaked of a former president of the Colombian Mining Association, Mr Santiago Angel, stating that ‘the only perceptions that matter are those of regulators in Bogota, not local communities’.
We can assure Colombian and other communities that they are hugely important in the development of any mining project and we will not help finance any mining company that thinks otherwise.
Mr Angel’s comments are in relation to Minesa’s application for an environmental licence at its Soto Norte 400,000ozpa gold project in Santander for a large underground mining operation.
The project is downstream from the former Greystar Resources Angostura gold project which was stopped due to environmental issues over potential for pollution of water supplies.
We hope the community comments are taken out of context and refer to the fact that Minesa’s project is underground and therefore have less impact on local communities
We suspect the comments may setback community relations for some time.

Currencies

US$1.1210/eur vs 1.1243/eur yesterday Yen 111.83/$ vs 111.87/$ SAr 14.372/$ vs 14.167/$ $1.293/gbp vs $1.299/gbp 0.704/aud vs 0.712/aud CNY 6.724/$ vs 6.713/$

Commodity News

Precious metals:

Gold US$1,270/oz vs US$1,274/oz yesterday – Central Banks continue to buy gold as a stronger US dollar weakens prices

Global central banks continue gold purchasing spree, with India joining counterparts in Russia and China adding to its record holdings to lend support to worldwide bullion demand as top economies diversify their reserves.
The Reserve Bank of India’s purchases are part of a wider picture across developing economies that are looking at de-dollarising their foreign-exchange reserves.
The RBI could look to add 1.5Moz in 2019, equivalent to 46.7t, according to economist forecasts. This follows purchases last year of 42t, with additions in January and February driving the nations gold reserves to a record high of almost 609t, according to the International Monetary Fund.
Russia bought 274t in 2018 and has added more this year, while China’s central bank is on a renewed buying spree that began in December. Global official sector gold purchases could reach 700t in 2019 led by these countries as well as Kazakhstan, Iran, and Turkey, according to Citigroup Inc estimates.
Heightened geopolitical and economic uncertainty pushed central banks to diversify their reserves and focus on investing in safe and liquid assets, with governments worldwide adding 651.5t of bullion last year -- the second-highest total of purchases on record, according to the World Gold Council.
India’s foreign-exchange reserves are improving steadily and foreign fund inflows “are strong, hence buying US Treasuries and gold will help keep the rupee on the weaker side and give a boost to exports”, according to precious metals head at Kotak Mahindra Bank.
India have more room for diversification – while the nations gold holdings are the 10th largest by country, they only account for 6.4% of its reserves, compared with more than 70% in Germany and the US, according the WGC data.

Gold ETFs 71.3moz vs US$71.4moz yesterday

Platinum US$888/oz vs US$898/oz yesterday

Palladium US$1,390/oz vs US$1,383/oz yesterday

Silver US$14.81/oz vs US$14.97/oz yesterday

Base metals:

Copper US$ 6,411/t vs S$6,433/t yesterday - Codelco - cuts key executives as state-owned group cuts costs

Aluminium US$ 1,874/t vs US$1,877/t yesterday

Nickel US$ 12,410/t vs US$12,570/t yesterday

Zinc US$ 2,732/t vs US$2,775/t yesterday

Lead US$ 1,924/t vs US$1,935/t yesterday

Tin US$ 19,760/t vs US$20,235/t yesterday

Energy:

Oil US$74.1/bbl vs US$74.6/bbl yesterday

Natural Gas US$2.464/mmbtu vs US$2.530/mmbtu yesterday

Uranium US$25.70/lb vs US$25.80/lb yesterday

Bulk:

Iron ore 62% Fe spot (cfr Tianjin) US$91.4/t vs US$91.3/t

Chinese steel rebar 25mm US$650.9/t vs US$652.0/t

Thermal coal (1st year forward cif ARA) US$74.7/t vs US$74.2/t

Coking coal futures Dalian Exchange US$180.9/t vs US$181.2/t

Other:

Cobalt LME 3m US$34,500/t vs US$35,000/t – Fortune Minerals signs option for alternative refinery site in Canada (Mining Journal)

Fortune Minerals has signed an option agreement for a site on which to build a new hydrometallurgical refinery in the North West Territories, in Canada.

NdPr Rare Earth Oxide (China) US$39,782/t vs US$39,844/t

Lithium carbonate 99% (China) US$9,667/t vs US$9,682/t

Global lithium demand is forecast to surge 20% in 2019, driven by swelling electric vehicle output according to Chilean producer SQM. The annual report also suggests the demand for lithium chemicals increased around 27% in 2018, reaching 269,000t.
“We believe that full electric vehicle penetration rates reached 2% in 2018, and this number is expected to over double in the next five years," added the company, which currently has an installed capacity of 70,000tpa of lithium carbonate and 13,500tpa of lithium hydroxide.
The major estimates that batteries currently account for 65% of total lithium demand, including batteries for electric vehicles, which account for approx. 36%.
Despite increasing demand, a flurry of new supply into the market will keep pressure on prices.
“However, there are several lithium grades of different qualities available in the lithium market, and not all products are sold at the same price," it said, adding that "we do not believe that all lithium supply entering the market is suitable for all customers" and that SQM will focus on providing high-grade product.”

Ferro Vanadium 80% FOB (China) US$51.5/kg vs US$51.5/kg

Antimony Trioxide 99.5% EU (China) US$6.2/kg vs US$6.3/kg

Tungsten APT European US$270-282/mtu vs US$270-282/mtu

Battery News

Elon Musk – expects Tesla to produce ‘robotaxis’ in 2020

The idea is a simple extension of the self-drive Tesla which in theory could be summoned to pick you up
While we like the idea of a robotaxi we will miss the rich and diverse conversations we have had with may of our overseas visitors on their place of origin.
We have learned much from Uber drivers from Somalia to Biafra, Nigeria and their tales of life in their former homelands.

BMW turns to ethical cobalt supply

German automaker BMW will purchase the fundamental battery metal cobalt directly from mines in Australia and Morocco to ensure they are not produced by child labour, according to an executive.
The announcement came as the London Metal Exchange launched an initiative under which it could ban or delist brands that are not responsibly sourced by 2022 to help root out metal tainted by child labour or corruption.
Andreas Wendt, BMW board member responsible for procurement, told a briefing in Paris that the new supply of cobalt would be used in the carmaker's next generation of EVs in 2020.
The trend for supply chain transparency and responsible procurement follows reporting cobalt and other conflict minerals are typically mined in artisanal operations across the DRC where production is not strictly monitored.

Nano-coating gives longer-lasting lithium batteries

Solid-state batteries promise greater energy density and safety without the highly flammable liquid electrolyte, however laboratory tests are trying to overcome lithium plating and the formation of dendrites which can create short-circuits should they penetrate the membrane separator.
A new study from a Colombia Engineering team led by Yuan Yang, assistant professor of materials science and engineering, announced success prolonging battery life by inserting a nano-coating of boron nitride to stabilise solid electrolytes.
"Lithium metal is indispensable for enhancing energy density and so it's critical that we be able to use it as the anode for solid electrolytes," says Qian Cheng, the paper's lead author.
"To adapt these unstable solid electrolytes for real-life applications, we needed to develop a chemically and mechanically stable interface to protect these solid electrolytes against the lithium anode. It is essential that the interface not only be highly electronically insulating, but also ionically conducting in order to transport lithium ions. Plus, this interface has to be super-thin to avoid lowering the energy density of batteries."
The team deposited 5-10nm boron nitrate nano-film as a protective layer to isolate the electrical contact between lithium metal and the ionic conductor electrolyte. Boron nitrate is chemically and mechanically stable with lithium metal, therefore providing a high degree of electronic insulation.
Commercial development is helped as boron nitrate nano-film can be readily prepared by chemical vapor deposition to form large-scale, atomically thin scale (~nm level), and continuous films.
The team expect to fabricate solid-state batteries with high performance and long-cycle lifetimes.

Company News

Altus Strategies* (LON:ALS) 3.8p, Mkt Cap £6.7m – JV term sheet signed on gold projects in Liberia and Cameroon

The Company signed a non-binding term sheet with Corben Resources regarding the Zolowo gold project (Liberia) and the Laboum gold project (Cameroon).
Corben launched a two months due diligence process with completion of agreements due to take place no later than 14 October 2019.
Corben is an Australian company formed to explore and develop gold properties in sub-Saharan Africa that is looking to list on the ASX.
Zolowo project deal terms:
A$82,500 cash payment to Altus;
10% of the issued equity capital of Corben upon the IPO;
A$500,000 payment on the definition of each of a 1moz resource and a 1moz reserve;
2.5% NSR on the project (Corben has the right to buy back 1% NSR for US$2m);
Altus will remain operator of the project for the first 24 months on an at cost +10% basis.
Laboum project deal terms:
Stage 1 (Exploration) 51% in return for A$2m exploration spend over two years, A$250,000 equity payment at the IPO price to Altus, A$150,000 cash payment to Altus;
Stage 2 (Exploration) additional 19% in return for A$4m exploration spend over subsequent two years, A$350,000 equity payment to Altus, A$200,000 cash payment to Altus;
Stage 3 (DFS) additional 20% in return in return for completing a DFS over the subsequent two years, A$500,000 equity payment to Altus, A$350,000 cash payment to Altus;
Stage 4 (Mine Construction) additional 10% (Altus has an option to co-fund Stage 4) in return for completing mine construction within the subsequent two years, A$5m equity payment to Altus, A$1m cash payment to Altus, also Altus to retain 2.5% NSR (Corben has the right to buy back 1% NSR for US$2m).
Altus will remain operator of the project until Corben earned a 51% interest on an at cost +10% basis.
Additionally, Corben will a A$50,000 exclusivity payment to Altus subject to Corben raising A$350,000 in the IPO.
Both projects are early stage but highly prospective assets covering areas of extensive artisanal alluvial gold workings.

Conclusion: The announcement marks the potential to add another JV partner into the fold allowing to move gold assets in Liberia and Cameroon forward while receiving milestone based cash and equity payments as well as retaining exposure to projects through a net smelter royalty. We like offered terms with Laboum alone potentially generating A$7.8m in equity and cash proceeds excluding 2.5% NSR and Corben carrying the project into production. We are looking forward to the outcome of the due diligence.

*SP Angel acts as Nomad and Broker to Altus Strategies plc

Antofagasta (LON:ANTO) 968.8p, Mkt Cap £9,555m – Q1 production maintains guidance as copper output increases

Antofagasta reports a 22.6% increase in copper production compared to Q1 2018 to 118,600t at a net cash cost of US$1.24/lb. The output is, however 14.3% below that of the previous quarter “reflecting last year’s unusual production profile of quarter-on-quarter increases.”
As a result, Antofagasta is maintaining its 2019 production guidance range of 750-790,000t of copper production and cash cost “guidance before and after by-product credits is also unchanged at $1.70/lb and $1.30/lb respectively”.
Increased grades and throughput at Los Pelambres resulted in a 10% increase in copper production to 89,200t (Q1 2018 – 81,100t) although scheduled maintenance in January, coupled with lower grades, led to a decline from the 100,100t achieved during Q4 2018. “Cash costs before by-product credits in Q1 2019 were $1.44/lb, compared with $1.72/lb in Q1 2018”.
At Centinela, copper output “was 68,800 tonnes, 45.5% higher than in the same quarter in 2018, primarily due to higher production of copper in concentrates. Compared with the record production in Q4 2018 total production decreased by 20.4%.” Gold production increased by 168% compared to last year to 46,600oz “due to significantly higher gold grades, and higher throughput and recoveries”.
As a result of the higher gold output at Centinela, “Cash costs before by-product credits at $1.85/lb in Q1 2019 were 23.9% lower than in the same quarter in 2018 due to the increase in production and weaker Chilean Peso … [and] … Net cash costs in Q1 2019 decreased by 36.7% to $1.38/lb reflecting lower cash costs before by-product credits and by-product credits increasing from $0.25/lb to $0.47/lb on higher gold production”.
The Antucoya mine produced 22.6% more copper than in Q1 2018 at 17,900t (Q1 2018 – 14,600t) and “cash costs were $2.22/lb compared to $2.29/lb in Q1 2018. This was due to higher production during the period and a weaker Chilean Peso, partly offset by increased acid costs”.
Zaldivar also increased copper production to 12,700t (Q1 2018 – 10,800t) although cash costs were higher at US$1.91/lb (Q1 2018 – US$ 1.86/lb) “primarily due to higher acid prices and partially compensated by higher production and weaker local currency.”
Commenting on the results, CEO, Ivan Arriagada, said “The high level of operating performance achieved in the second half of last year continues and we are on-track for another record-setting year with full year production expected to increase by up to 9% to 750-790,000 tonnes.”

Conclusion: Antofagasta has made a solid start to 2019 and is maintaining its previously announced production and cost guidance

Bushveld Minerals (LON:BMN) 26.3, Mkt cap £294m - Vanadium prices look up following recent correction

Ferro-vanadium prices are looking up according to latest price data from AsiaMetals on Bloomberg.
The mid-price for ferro-vanadium in China rose to $51.50/kgV yesterday from a low of $48.5/kgV having started the year at $75/kgV.
Failure to enforce Green Shield environmental regulations and new standards on higher vanadium content in steel may have contributed to the punishment of 163 Chinese officials in Shandong province.
China's Ministry of Ecology and Environment said Shandong officials not only failed to meet guidelines on industrial overcapacity, but also deceived central government inspectors and tried to cover up illegal behavior.
The rise in ferro-vanadium prices may help Bushveld Minerals* shares go higher. Bushveld Minerals sets sights on SA power market (Business Day)

*SP Angel acts as Nomad & broker to Bushveld Minerals.

Centamin (LON:CEY) 85.32p, Mkt Cap £988.9m – Q1 Production and exploration update

Reflecting record plant throughput of 3.25mt of ore Centamin reports gold production of 116,183oz for the quarter ending 31st March, exceeding its forecast range of 105-115,000oz in what the company expects to be the weakest production quarter this year.
The company also says that “Both unit cash costs and all in sustaining costs ("AISC") [are] trending toward the lower end of annual guidance; cash costs of production of US$631 per ounce produced and AISC of US$898 per ounce sold”.
“The Company is on track and reiterates annual guidance for 2019: gold production of 490,000 - 520,000 ounces, at cash costs of US$675-725 per ounce produced and an AISC of US$890-950 per ounce sold.”
During the quarter open pit operations at Sukari “performed broadly in line with plan and the underground operation performed better than plan, with improvements to underground operational efficiencies delivering higher grades.”
Lower than expected consumption of both fuel and reagents contributed to cost reduction and partially offset increased costs of consumables at the mine while the treatment of higher grade underground ore in preference to open-pit ore helped contribute to cost control although “Unit cash costs of production of US$631 per ounce produced, a 9% increase YoY and 4% increase QoQ, and unit AISC of US$898 per ounce sold, a 9% increase YoY and 11% increase QoQ - as a result of comparatively fewer gold ounces produced and sold in the respective quarter”.
Centamin’s exploration “inside the Sukari complex has yielded outstanding results, unlocking more reserve and resource growth potential, including the continuation of high-grade structures within the porphyry.” The company notes that its exploration drilling of the Horus Deeps area has provided encouraging results “analogous to results historically seen in the upper Amun” zone and the company will be giving priority to follow-up in 2019 “to better understand and define these deeper mineralised structures”.
Drilling on the Ptah zone, described as a “key growth driver for the underground mine … confirmed continuity of grade with high-grades concentrated along strike on the eastern contact where stockwork zones form internally within the porphyry”.
At the Doropo project in Cote d’Ivoire, where the company has already defined an indicated mineral resource of 50mt at an average grade of 1.31g/t gold (2.1moz) and an inferred resource of a further 0.8m oz at a similar grade, Centamin plans a further 55,000m of drilling this year in order to establish “near-term resource growth, maiden reserve and increased target generation outside the Resource Area.”
Work is continuing on the Preliminary Economic Assessment of the Doropo project “with completion expected in H2”.
A further 34,000m of drilling is also planned at the ABC project, also in Cote d’Ivoire, “focussing on resource development at Kona Central and Kona South, while testing the resource extension potential between the two prospects, and drill testing high priority targets …”.
Commenting on the results, CEO, Andre Pardey said ”We have made a solid start, delivering Q1 ahead of expectations” and went on to say that “A stronger second half for the year is forecast, delivering approximately 55% of the annual production guidance during H2 2019. This will be driven by increasing quarter on quarter open pit ounce contribution, as the grade profile improves with depth, and further optimisation of our underground operations.”

Conclusion: Centamin has staged a strong performance in Q1 2019 after the “challenging year” experienced in 2018 and is currently maintaining its production forecast range of 490-520,000oz for the year with the expectation that the strongest performance will be achieved during the 2nd half.

Petropavlovsk (LON:POG) 8.0p, Mkt Cap £264m – Annual accounts and Q1/19 production update

Revenues amounted to $500m (2017: $587m) reflecting lower gold sales (370koz v 422koz produced) and flat gold prices ($1,263/oz v $1,262/oz in 2017).
TCC came in at $786/oz, broadly in line with market estimates for $793/oz, while AISC averaged $1,117/oz, up on $975/oz forecast.
EBITDA totalled $143m (2017: $197m), 6% better than $135m forecast.
Capex amounted to $134m with $22m relating to exploration and $62m spent on POX. 2019 capex guided at $45-55m.
Post interest FCF amounted to $83m (2017: $36m) helped by $131.8m in advance payments for gold to be delivered over the next 12 months from Gazprombank and Sberbank.
PBT climbed to $82m compared to $49m in 2017 on the back of a $102m impairment reversal.
Net Debt stood at $550m as of Mar/19 (Dec/17: 585m)
Q1/19 production totalled 107.7koz v 112.6koz as a drop in Pioneer output was less than compensated by refractory gold output at Malomir.
At Malomir, fully ramped up Stage I flotation plant (2x1.8mpta) treated 895ktr at 0.73g/t for production of 25kt of 23g/t concentrate in Q1/19. The Company test run facilities using low grade ore as well as studying the effect of lower grade feed on concentrate yields and plant recoveries which performed well yielding 2.8% and 87%, respectively. Malomir is due to treat 1.2-1.3g/t material post Q2/19, in line with the mine plan.
Two POX lines commissioned and are being ramped up with recoveries running at 91% as of March and are on track to reach 94% during the year.
Autoclaves 3 and 4 (125ktpa each) were tested during Q1 and shown to be fully operational. Additional capacities remain on stand-by until third-party concentrate is secured.
In total, Malomir production amounted to 45koz, 59%yoy up, accounting for refractory gold output contribution of 27.7koz (post POX recoveries).
On other operations, production at Pioneer came in at 22koz, 46%yoy down and 7koz below budget, driven by lower grades and weaker throughput rates as harder material from lower horizons affected crushing circuit productivity.
Albyn produced 41koz, 5%yoy up and 4koz above budget, helped by higher processed grade.
2019 guidance includes 450-500koz (including processing of refractory concentrate from FY18, but excluding 3rd party concentrate) at $850-950/oz TCC (at (USDRUB 66), up on $650-700/oz guided previously. Unit costs are expected to normalise at 15% below 2019 guidance once POX operates at full capacity.
POX is expected to treat 155-175kt of refractory gold concentrate grading 30-31g/t including 2019 Malomir flotation plant production of 125-145kt at 29-32g/t and 29kt at 28g/t stockpiled material from last year.
On 3rd party material POX processing, Petropavlovsk trialled two batches of refractory material with one reported to be up to 75g/t and pilot testing demonstrating recoveries of around 92-96%.
Potentially, the Company is targeting to process 440ktpa of in-house concentrate sourced from Malomir (200kt, 27.0% S) and Pioneer (240kt, 22.5% S).

Conclusion: The announcement offers a mixed bag with operations likely to remain FCF generation constrained this year on the back of guided higher cash costs as refractory processing plant ramps up. On a positive note, production is due to accelerate in H2/19 as Malomir flotation plant treats better grade material and POX operations ramp up to design parameters while potential processing of 3rd party material offers an upside to the guided 450-500koz 2019 target with cash costs expected to follow and normalise, accordingly.

Sunrise Resources Plc (LON:SRES) 0.11 pence, Mkt Cap £3.0m –Nevada project updates

Sunrise Resources has announced that a second large cement company has confirmed positive results from trials of concrete using Sunrise Resources’ natural pozzolan product from its CS Pozzolan-Perlite deposit in Nevada.
The company has previously indicated that the closure of coal fired power plants is reducing the availability of waste fly-ash to the cement industry and that its natural pozzolan is well placed to move into this role as a naturally occurring alternative.
The company has also indicated that the “Latest testwork shows promise for production of premium-value super-coarse horticultural grades of perlite.”
Further bulk sampling at the site includes:
A “7 ton sample of perlite has been submitted for crushing and screening to confirm mobile plant design”;
An “18-ton pozzolan sample sent to custom milling facility to provide information on grinding characteristics and to provide larger ground samples for additional customer trials” and
A “100-ton sample of perlite [ has been] extracted for further processing and customer testing”
The company expects to advance its permit applications with the submission, later this month, of its “Operation and Reclamation Permit Application” as well as various Federal and State environmental submissions. Sunrise Resources confirms, however, that the “Latest estimates suggest completion of permitting will be delayed slightly to 4th quarter of this year following procedural changes by the Regulator.”

Conclusion: The latest testing results are encouraging for both the pozzolan and the perlite material from the CS project. Procedural delays are however slowing the permitting process which is not now expected before Q4.