Today's Market View - Atalaya Mining, Base Resources, Beowulf Mining and more...

Atalaya Mining (LON:ATYM) – Interim Results and guidance maintained Base Resources (LON:BSE)  -  – JORC Reserve and resource statement for 2020 Beowulf Mining* (LON:BEM) - Funding secured to restart exploration at Majdan Peak, Kosovo  Caledonia Mining* (LON:CMCL) – Q2 Results and impact of Covid19

Atalaya Mining - Today's Market View -

SP Angel . Morning View . Thursday 13 07 20

S&P 500 set to each pre pandemic levels despite no resolution on stimulus


Atalaya Mining (LON:ATYM) – Interim Results and guidance maintained

Base Resources (LON:BSE)  -  – JORC Reserve and resource statement for 2020

Beowulf Mining* (LON:BEM) - Funding secured to restart exploration at Majdan Peak, Kosovo 

Caledonia Mining* (LON:CMCL) – Q2 Results and impact of Covid19

Condor Gold* (LON:CNR) –  Click here for Initiation note pdf – Land purchases and progress on design engineering

KEFI Minerals* (LON:KEFI) – AGM

SolGold* (LON:SOLG) – Drilling underway at La Hueca


Gold - $1,934/oz – gold holds new support level as US Dollar sinks with stalling stimulus negotiations

Prices remain volatile trading in a $40/oz range over the last 24 hours after hitting a low of 1,863/oz on Wednesday.

A drop in prices recorded over the last several days came amid technical selling and profit taking as well as investors reviewing respective economic growth expectations.

Despite a correction of ~$200/oz, gold prices at 27% up YTD with supportive fundamentals including negative US real rates and a continuing monetary and fiscal stimulus remaining in place.

ETF gold holdings have also pulled back recording four consecutive days of drawdowns since last Friday.

The US Dollar Index (DXY) fell to 93.30 on Wednesday following three consecutive daily advances, as Treasury Secretary Mnuchin cast doubts over a compromise between Senate Republicans and House Democrats to agree on the size of a fresh stimulus package. 

The dollar has risen from the two-year lows seen last week, with the dollar's value languishing as a result of the US struggling to control the coronavirus pandemic compared to other economies. 

The dollar has fallen around 10% from its March highs, and its 6% weaker than its H1 average. 

A weak US dollar could be a "double-edged sword" for mining companies as the price of metals generally move higher, although a stronger domestic currency as a result of the weaker dollar could become a cost headwind. 

Gold ETFs continued their selloff falling to 108.5moz of gold held in ETF form. While some EFTs are backed with physical gold many are not.

The total value of ETF gold holdings are $22.8bn on Bloomberg’s 108.5moz total ETF estimate.

We hope and estimate the Coronavirus pandemic will largely burn itself out in the six months as T-Cell resistance helps to build herd immunity

There is always potential for a second wave of an altered Coronavirus to cause further lockdowns which elevates risk which is why we see ongoing support for gold at around US$1,875/oz.


China stimulus – RMB 50tn ($7.2tn) stimulus across 25 provinces - RMB7.6tn (US$1.1tn) planned for this year (Roskill)

China is targeting ~RMB2tn ($280tn) per year of new investment in infrastructure in its 5-year plan with RMB10tn (US$1.4tn) of direct investment and RMB17tn (US$2.4tn) of indirect investment by 2025.

China used RMB4tn (US$570bn) of stimulus to kick start the economy in 2008 focussed mainly on road, rail and urban construction.

We expect flooding along the Yangtze to command significant additional expenditure for new flood defences and to repair much that has been washed away.

Flooding has hit nearly 20% (13m acres) of all China’s productive farm land costing some $21m in damage to roads and other property (Winknews)

China is now focussing new technology infrastructure such as EV charging and wind and solar farms as well as new grid-scale battery storage.


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China EV sales begin to recover

Data from the China Association of Automobile Manufacturers on Tuesday shows EV sales increased in China for the first time in over a year.

NEV sales rose 19.3% on the year to 98,000 units. BYD led NEV sales with 14,000 units sales whilst Tesla led pure electric sales with 11,041 units.

The majority of sales in July were pure EVs which grew 24%, accounting for 78,000 units.

Vehicle sales more broadly showed signs of recovery as well with a 16.4% increase to 2.112m in July. From Jan to July sales were down 12.7% compared to the same time last year.

Commercial vehicles were the big gainer with sales increasing 59.4% to 447,000 units while sales of passenger vehicles grew 8.5%.


Nio back on track

EV start-up Nio’s quarterly vehicles sales RMB 3.49bn ($493.4m), 94% of revenue and up 146.5% YoY. The stock did however fall 4% on the news as revenue came in below consensus estimates of RMB3.51bn.

The car maker delivered 3,533 vehicles in July, a 322% increase YoY and a record high quarterly delivery of 10,331 vehicles.

CEO William Li said in a statement the Company plans to increase capacity to 150,000 units/year and should be able to do so without significant investment. The Company is targeting 4000-5000 units a month by the end of August.

Nio has delivered 17,792 vehicles in 2020 a 111.3% increase YoY despite the disruption caused by the pandemic. Monthly deliveries reached a low in February of 707 as COVID-19 swept through China and the country was under lockdown but have since improved with over 3000 vehicles sold in each month from April to July.

The Company expects vehicles sales of between 11,000 and 11,500 in Q3 and guided to above consensus revenue estimates of between $572.9m and $596.2m.

Although revenue came in below estimates it would appear Nio is moving into H2 with a more positive outlook after a difficult Q1. The Company achieved better than expected gross margins and positive cash flow for the first time.

Deliveries of the EC6 are expected to commence in September following the launch of the 5-seater electric coupe in July. The vehicle has a 100kWH lithium-ion battery pack with a 615km on a single charge.


Dow Jones Industrials +1.05% at 27,977

Nikkei 225 +1.78% at 23,250

HK Hang Seng -0.14% at 25,208

Shanghai Composite +0.04% at 3,321



US – Inflation is picking up beating expectations in July driven by an increase in auto and apparel costs.

Core CPI climbed 0.6%mom in the largest jump in almost three decades after a 0.2%mom increase in June.

On annual basis, core inflation was up 1.6% reaching a four month high following a 1.2% jump in June.


France – Unemployment rate dropped to 7.1% in Q2 from 7.8% in the previous quarter reflecting a drop in labour force.

A measure of people who wish to work but ae not counted as unemployed because they were unable to look for a job in confinement increased to a record of more than 2.5m.

Additionally, youth employment (aged between 15 and 25 years) levels are seen falling to the their lowest in at least 45 years.


South Korea reported 47 new locally transmitted COVID-19 cases marking the highest level in a month.


India reported a record 67,000 new coronavirus infections over the past 24 hours taking the total toll to 2.4m, the third highest in the world.


UK - Sussex hit by magnitude-3 earthquake with epicentre in the middle of the English Channel


Occupancy at hotels reopened by Tui, Europe’s largest tour operator, are at about a fifth of normal levels.

The group reported a loss of more than €2bn in nine months to June with revenues collapsing 98%yoy in the last quarter.

The Company is planning to cut its business costs by nearly a third.

Operating profits fell $686m to $1.7bn at Zurich, the insurance group, driven by COVID-19 related claims.


Russia - Professor Chucalin quits health ministry ethics council after failing to block registration of Russia’s new Coronavirus vaccine on safety grounds.

It is quite possible that Vladimir Putin could join the ranks of Jo Stalin and Chairman Mao if Russia rolls out an unproven and unsafe vaccine into the population too early.

We suspect Putin may promote the vaccine in Eastern Ukraine, Georgia and other FSU states before testing it on their domestic population.



US$1.1829/eur vs 1.1744/eur yesterday.  Yen 106.63/$ vs 106.75/$.  SAr 17.417/$ vs 17.488/$.  $1.308/gbp vs $1.305/gbp.  0.716/aud vs 0.713/aud.  CNY 6.943/$ vs 6.951/$.


Commodity News

LME off-warrant stock rises 8% in June

Latest data from the LME shows a rise of 110,000 tonnes of off-warrant stock available outside of the LME network.

At the end of June 1.35mt of stock was held off-warrant vs 1.24mt at the end of May. 

Out of the 110,000t of metal added, nearly 70,000t was aluminium, taking the total held off-warrant to 1.07mt. 

Total off-warrant copper stocks fell by 4,205t to 157,000t, as stocks in Asia and the US declined, and despite a rise in European stocks.

Asia holds the lion’s share of off-warrant metals stock with 924,000t, compared to just 226,000t in Europe and 199,000 in the US (Fastmarkets MB). 


Precious metals:         

Gold US$1,930/oz vs US$1,935/oz yesterday

Gold ETFs 108.5moz vs US$108.7moz yesterday

Platinum US$937/oz vs US$951/oz yesterday

Palladium US$2,128/oz vs US$2,158/oz yesterday

Silver US$25.84/oz vs US$25.84/oz yesterday


Base metals:  

Copper US$ 6,357/t vs US$6,345/t yesterday

Aluminium US$ 1,780/t vs US$1,785/t yesterday

Nickel US$ 14,190/t vs US$14,160/t yesterday

Zinc US$ 2,373/t vs US$2,389/t yesterday

Lead US$ 1,936/t vs US$1,952/t yesterday

Tin US$ 17,560/t vs US$17,670/t yesterday



Oil US$45.2/bbl vs US$44.9/bbl yesterday - Oil prices saw another boost as renewed US-Iran tensions and reports of strained bilateral relations

The UN Security Council is currently preparing to vote on a US-led initiative this week to extend the arms embargo against Iran

In the 2015 nuclear deal, members agreed to suspend the country’s right to freely purchase and sell military hardware until October of this year

However, the new proposal by the US seeks to extend this ban indefinitely

The proposal has been met with opposition by China and Russia who hold veto power on the 15-member council

Resistance to join the venture may further widen the rift between the US and China, who are already at odds over trade and Beijing’s policy toward Hong Kong

Elsewhere, OPEC’s latest Monthly Oil Market Report published yesterday shows a downgrade in its oil demand outlook

Due to the unprecedented shock to the global economy, the world’s oil demand is expected to drop by 9.1MMbopd in 2020, a larger demand loss than the group had estimated last month    

OPEC now forecasts that the global economy will shrink by 4% this year, more than the 3.7% economic drop expected in the July forecast, due to the additional negative impact of the pandemic  

In addition, given lower economic activity levels in some major developing countries, this year’s global oil demand is now forecast to reach 90.6MMbopd — a drop of 9.1MMbopd compared to 2019

The expected decline in demand is around 100,000bopd larger than OPEC had forecast last month

In 2021, global oil demand is set to grow by 7MMbopd, with the expected rise unchanged from last month’s projection.

As of June, commercial oil stocks in OECD countries were still rising, according to OPEC estimates

At 3.240Bnbbls, they were 301.5Mbbls higher than the same time a year ago, and 291.2MMbbls above the latest five-year average

Natural Gas US$2.190/mmbtu vs US$2.155/mmbtu yesterday

Natural gas prices are up in early trading today ahead of this afternoon’s inventory report from the Department of Energy

Expectations are for a 40Bcf increase in natural gas stockpiles according to survey provider Estimize

This compares to last week’s 33Bcf increase

There is a tropical depression (number Eleven) that has formed in the Atlantic, but the trajectory of the storm does not have it coming near any US natural gas installations

The weather is expected to be warmer than normal in the US South West and West and cooler than normal in the mid-west.

Uranium US$32.10/lb vs US$32.20/lb yesterday



Iron ore 62% Fe spot (cfr Tianjin) US$115.4/t vs US$113.9/t - Port Hedland iron ore shipments highest ever in July

Shipments totalled 43.6mt in July, a record for that month according to the Pilbara Ports Authority. 

Total exports via Port Hedland hit an all-time high of 51.8mt in June, compared to 41.0mt last month.

YTD exports totalled 314.49mt vs 295.44mt over the same period last year (Bloomberg). 

Benchmark spot prices have surged as high as $122/t this year, due to robust demand from Chinese mills and supply worries from countries. along with port logistics issues in China. 

Chinese steel rebar 25mm US$543.4/t vs US$543.1/t - Steel production fell globally as lockdowns took effect in China, Europe and North America

RHI Magnesita ‘RHI’ which makes refactories for steel producers saw H1 pre-tax profits fall to €70M from €165M yoy

Sales fell 24% to €1.71Bn

Net debt remains stable at €666M

RHI’s steel division sales fell 22.4% to €820M

RHI estimates global steel production fell by 6% in H1 yoy  2020 compared to the same period last year.

Global steel production fell 14.3% excluding China falling by 24.8% in Q2 due to US and European lockdowns.

Demand slowed for many sites halted construction and warehouses closed preventing the delivery of steel and other materials.

Even, construction sites which remained open were frustrated by logistical issues.

China suffered a shortage of truck and train drivers and the closure of the Wuhan boarder with the rest of China stranded containers and wagons.

The UK government maintained work on much of the new HS2 line through the lockdown but was frustrated in major cities with Labour mayors who closed local HS2 construction sites.

Thermal coal (1st year forward cif ARA) US$56.7/t vs US$57.6/t

Coking coal swap Australia FOB US$119.0/t vs US$119.0/t



Cobalt LME 3m US$33,200/t vs US$33,200/t

NdPr Rare Earth Oxide (China) US$47,028/t vs US$46,255/t - Russia aims to raise share in global rare earths output through tax incentives

Russia plans to raise its share in global rare earths output to 10% by 2030 from 1.3% now, by offering reduced mining taxes and cheaper loans. 

Russia has reserves of 12mt, roughly 10% of the global total- and the government says it is willing to back any foreign investment. 

Eleven projects have been proposed, which will require at least $1.5bn in investment, according to Russia's deputy industry and trade minister. 

The eleven projects will allow Russia to become almost self-sufficient in rare earth elements by 2025, with exports commencing in 2026 according to the minister (Reuters).

Lithium carbonate 99% (China) US$4,998/t vs US$4,992/t

Ferro Vanadium 80% FOB (China) US$30.2/kg vs US$30.2/kg

Antimony Trioxide 99.5% EU (China) US$5.1/kg vs US$5.1/kg

Tungsten APT European US$205-210/mtu vs US$205-215/mtu

Graphite flake 94% C, -100 mesh, fob China US$430/t vs US$430/t

Graphite spherical 99.95% C, 15 microns, fob China US$2,275/t vs US$2,275/t


Battery News

BMW working towards powertrain without rare earth metals

Bentley is set to spend the next 3yrs developing a powertrain that does not rely on rare earth metals. The Company is not due to release its first EV model until 2026.

The project is backed by the Office for Low Emission Vehicles (OLEV) with 9 companies involved.

Project OCTOPUS aims to develop a powertrain with an e-axle that doesn’t require rare earth magnets. It is not yet known what type of battery will be used or what type of vehicle Bentley’s 2026 release will be.

The initial stage of the project, taking up to 18 months will focus on developing the powertrain which should be cheaper due to the lack of rare earth minerals and has been suggested will also offer better performance.

Bentley is working towards providing a hybrid option for each of its current ICE models by 2023.  


Investigation into Polish state aid provided to LG Chem

The EU commission is investigating the Polish governments backing of LG Chem’s facility in the country during 2019. The government invested €95m (£85m) into the project.

The Commission in investigating whether the funding was in line with state aid rules.

There is doubt as to whether the support it provided was an incentive measure of whether LG Chem would have still invested in the Biskupice Podgorne plant regardless.

State aid rules allows member states to foster economic growth in disadvantaged regions but the aid must be required to attract the business and not just to provide the recipient with an unfair competitive advantage at the tax payers expense. The investment must be required to trigger the decision for private investment.

Support must fulfil certain conditions which include:

Incentivising private investment

Be the minimum necessary

Must not lure investment away from similarly disadvantaged regions in other member states

Must not directly cause relocation of activities


Hyundai strikes supply deal for zero-emissions vehicles in Sydney

Hyundai Australia has signed an MOU with Jemena Ltd and Coregas to produce and supply hydrogen to the South Korean automaker. The hydrogen will be generated from renewable sources of solar and wind power.  

Jemena will produce hydrogen at its Western Sydney Green Gas site and deliver it to Hyundai’s Macquarie Park in greater Sydney from early 2021. Hyundai’s facility is the only permanent hydrogen refuelling station in the country.

The project is also set to inject green hydrogen it produces into the existing gas network and test how it can be stored and used.

Hydrogen refuelling stations are scheduled to be built in Australian Capital Territory to support a government fleet of Hyundai NEXO vehicles and in Melbourne where Toyota Australia has committed to building a hydrogen fuel pump.  


Company News

Atalaya Mining (LON:ATYM) 193p, Mkt Cap £260.9m – Interim Results and guidance maintained

Atalaya Mining reports increased revenues and EBITDA as production of copper concentrate builds up following the completion of the expansion of the Proyecto Riotinto operation.

“The increase in Q2 EBITDA was driven by an increase in copper concentrates sold in the period offset by lower commodity prices and higher cash costs”.

Revenues increased to €56.5m during the quarter (Q2 2019 - €43.1m) and to €117.7m during H1 (2109 H1 - €94.8m) with higher concentrate output of 60,938t for the quarter and 120,941t for the six months (2019 48,382t and 91,823t) more than outweighing the lower copper prices of US$2.51/lb in the quarter (2019 - US$2.81/lb) and 2.54/lb for the half (2019 – US$2.80/lb).

Cash costs increased to average US$1.87/lb for the quarter (2019 –US$1.74/lb) and to US$1.93/lb for the half year (2019 – US$1.81/lb).

On an all-in-sustaining basis costs also rose to US$2.22/lb for the quarter (2109 – US$1.95/lb) and to US$2.25/lb for the half year (2019 – US$2.06/lb).

The company is currently maintaining is 2020 production guidance of 55-58,000t of contained copper and its cost guidance range of US$1.95-2.05/lb for cash costs and of US$2.20-2.30/lb for all-in-sustaining costs.

CEO, Alberto Lavandeira commented that “Despite the challenges of COVID-19, our Proyecto Riotinto site continues to perform well, with copper production and ore milled both increasing over the quarter and half year and our production and cash costs on track to meet our full year guidance. The work the Atalaya team has carried out during this time gives me immense pride as our key priority continues to be protecting our workforce and the local communities surrounding both Proyecto Riotinto and Proyecto Touro. Looking ahead, the completion of the Proyecto Riotinto expansion in 2019 means that Atalaya is well positioned to continue benefitting from higher copper concentrate sales and the improved commodity price environment”.


Base Resources (LON:BSE)  - 10.22p, Mkt cap £123m – JORC Reserve and resource statement for 2020

Base Resources has updated its Mineral Resources and ore reserves statement for 2020.

The statement shows:

Toliara (Madagascar): Ore Reserves 586Mt @ 6.5% HM for 38mt in-situ HM as published on 6 December.

Kwale South Dune (Kenya):  Resources and Ore Reserves reduced by mining and by a 5% reduction in the estimated material bulk density, sterilisation of sub-economic material and a reduction in the size of the prospecting licence omitting some low-grade material, with the total effect of:

This cut the South Dune Mineral Resources by 38mt (1.1t HM) and the Ore Reserves by 22Mt (0.9mt) HM.

Mining reduced the resource available for mining by 18.5mt containing 0.67mt of HM.

The Kwale Mineral Resources now stands at 246mt containing 4.9mt HM and grading 51% ilmenite in the HM and 13% rutile in the HM assemblage this compares with 285mt as at 30 June 2019.

Ranobe (Kenya): is a larger deposit with higher grade. The resource stands at 1,293mt with 66mt HM and 72% ilmenite but just 2% rutile in the HM assemblage


Beowulf Mining* (LON:BEM) 4p, Mkt cap £24.1m - Funding secured to restart exploration at Majdan Peak, Kosovo 

(Beowulf holds 46.1% of Vadar. Beowulf also holds 100% Kallak iron ore in Sweden, 100% of Aitolampi graphite in Finland and 40% of the Mitrovica and Viti projects in Kosovo)

Beowulf has secured loan financing in Sweden of SEK 12m (approximately £1m) before expenses, which will be used to restart exploration works at Madjan Peak, Kosovo. 

The initial focus at Majdan Peak will be geophysical surveys across the emerging epithermal gold target, with the objective of defining drill target areas.

This further exploration work is set to build on promising grab sampling across the area, reported by the Company in July, which resulted in 42 out of the 96 samples taken assayed above 0.1g/t with individual assays of up to 7.1g/t gold with eight results in excess of 1g/t. 

Beowulf have also made plans for geophysics surveys over the remainder of the Mitrovica license and the Viti licence prospective for copper-gold porphyry mineralisation. 

The Company's investment of £300,000 increases its ownership of Vadar from 42.2% to 46.1%.

The SEK 12 million loan has been secured from Nordic investors, Formue Nord Markedsneutral A/S and Modelio Equity AB. The loan has a fixed interest rate of 1.5% per started 30-day period during the duration period.  Accrued interest is non-compounding. The Loan has a commitment fee of 5% and a Maturity Date of 15 January 2021.

Conclusion: Beowulf is building on promising results from its grab sampling, a relatively early-stage exploration tool, which will now be defined further through geophysical surveys with the aim of defining drilling targets at Vadar Minerals' Majdan Peak project in Kosovo. 

*SP Angel acts as nomad and broker to Beowulf Resources


Caledonia Mining* (LON:CMCL) 1652.5p, Mkt Cap £194.5m – Q2 Results and impact of Covid19

Caledonia Mining reports a 30% rise in gross profit for the quarter ending 30th June to US$9.2m (Q2 2019 – US$7.0m) following a 6.2% increase in Q2 gold output at the Blanket mine to 13,499oz.

EBITDA, excluding foreign exchange gains, rose by 35% to US$9.6m (Q2 2019 – US$7.1m at a margin of 41.9% (q2 2019 – 43.0%).

Net cash at 30th June stood at US$11.7m (31st December 2019 – US$8.9m).

The company reports that “COVID 19 had a negligible effect on production in the Quarter.  Production continued at approximately 93% of target during the three-week lockdown which started in Zimbabwe on March 30, 2020; production subsequently returned to above-normal levels and production for the Quarter was only 1.2% below target but was above target for the First Half of 2020.  Production guidance for 2020 remains unchanged at 53,000 to 56,000 ounces”.

Unfortunately, however, virus mitigation measures have slowed progress on the completion of the new Central Shaft due to reductions in the size of the contractors’ team and the company says that “Due to continued travel restrictions, it has not been possible to replace these team members.  Although the slower rate of work has not yet delayed the project significantly, the project requires specialised equipment and contractors to travel to Blanket from South Africa which under the restrictions is not currently possible.  We are receiving a high level of support from the Zimbabwe government to address these issues with the relevant authorities in South Africa.  It is not possible to predict when travel and other restrictions will be lifted so that work can resume on the project as planned and it is likely the timetable for commissioning of the Central Shaft will be extended to an indeterminate extent. This may affect the anticipated build-up in production which is currently expected to be 75,000 ounces of gold in 2021 and 80,000 ounces of gold from 2022 onwards4 but it is not currently possible to provide revised guidance”.

CEO, Steve Curtis, said that “The improved operating environment, which I have referred to in previous quarters, has been sustained, although the country continues to face challenges. The interbank foreign exchange market was suspended in March 2020 but, by the end of June, an equivalent mechanism was introduced as a result of which the local currency has devalued further and allows us to better protect our workers from the effects of high inflation”.

Mr. Curtis also confirmed that “Interruptions to the supply of electricity from the grid have continued, but Blanket can manage these using its increased suite of diesel generators.  We have completed an evaluation of a solar project to provide some of Blanket's power supply and reduce its dependence on imported power and diesel gensets during daylight hours.  The Company has now resolved to construct a 12MW solar plant at a cost of approximately $12 million, which is expected to provide 100% of Blanket's baseload electricity demand during daylight hours and approximately 27% of Blanket's total daily electricity demand.  …  Subject to the continuation of travel and transport restrictions arising from the COVID-19 pandemic, this project could be operational by mid-2021”.

Conclusion: Covid19 has not impacted production at the Blanket mine and Caledonia Mining is maintaining its 53-56,000oz production guidance for 2020. Restrictions on travel as a result of the virus may, however, slow the completion of the Central Shaft and impact the planned build-up to  75,000oz in 2021.  


Condor Gold* (LON:CNR) 52.5p, Mkt Cap £58.7m – Land purchases and progress on design engineering

Click here for Initiation note pdf

Condor Gold reports progress in a number of key areas at its La India project in Nicaragua where the company is aiming to construct a 2800tpd mining operation to develop its 1.1moz gold resource.

In particular, the company highlights that it has now purchased 85% of the land within the mine permit area including sites for the open-pit,  processing plant, tailings storage area and explosives storage magazine.

Under the Environmental Permit, purchase of the land is a requirement of the licence and the news that the “Company has purchased 64 plots of land totalling 659 hectares in and around the permitted La India open pit mine site infrastructure, of which 479 hectares has been purchased this year” is an important step towards meeting this objective and clearing the way for the mine development.

“In addition, the Company can also demonstrate physical possession for approximately 18 years on the land covering the Mestiza open pit, has purchased the majority of this land and has claimed ownership over 303 hectares in this area. The Company has ownership of 96 hectares of land in the area of the America open pit”.

The company also reports important progress on the engineering designs where 40% of the design work on the tailings storage area is now complete and “Preliminary designs for the layout of the mine site infrastructure including, in some detail, the designs for the location of the processing plant have been completed. Mine and waste dump schedules for a number of mining scenarios have been completed. The power studies have been progressed”.

Chairman and CEO, Mark Child, confirmed that “It remains our intention to buy the remainder of the land this year and commence site preparation, while significantly advancing the engineering studies and placing a deposit on a processing plant”.

Confirmation that “processing plant designs will be finalised following the purchase of a second hand or new processing plant” is encouraging as it indicates that the company may achieve meaningful savings on the US$108m pre-production capital cost estimate that we used in our May 2020 research report which was based on purchases of new equipment if it is able to source a suitable second-hand plant.

Also, “power studies have been progressed as far as possible but final designs are only possible once the processing plant size has been finalised and the power requirement known. Several meetings have been held with the Ministry of Energy and Mines. A new electricity sub-station is being built closer to Mina La India”.

Conclusion: Condor Gold has made important progress on the required land purchases at La India where it has now secured 85% of the land required for the development and expects to complete land purchases this year. Advances in engineering design work include progress on the tailings disposal area, where 40% of the work is now complete, as well as the process plant. Confirmation that purchase of a second-hand plant is under consideration may generate meaningful capital cost savings, with associated economic benefits, if a suitable plant can be located.

*SP Angel act as sole broker to Condor Gold


KEFI Minerals* (LON:KEFI) 1.9p, Mkt Cap £35m – AGM

Shareholders passed all resolutions at the AGM including a slight name change to KEFI Gold and Copper.

“Our proposed new name communicates our mission more clearly and recognises our now-established position in gold and copper through the discoveries and acquisitions we have made,” the Company said.

In Ethiopia, the team is continuing discussion with potential funding partners aiming to close the Tulu Kapi development funding package in October paving the way for first gold in 2022.

The Company is aiming to keep up to 70% interest in the project, up from previously envisaged 45%, by putting in place a less dilutive funding structure.

At Saudi Arabia, the team is working on a maiden mineral resource estimate along with a PEA (expected in September) at the Hawiah copper/gold project following a recently completed successful drilling programme.

*SP Angel act as Nomad and Broker to KEFI Minerals


SolGold* (LON:SOLG) – 25.9p, Mkt cap £551.2m – Drilling underway at La Hueca

Solgold reports that its first hole, LHD-20-001 is underway at the La Hueca prospect in southern Ecuador and is currently at a depth of 91m testing the depth extent of outcropping copper-gold-molybdenum mineralisation on the Santos-Lindero zone.

The initial target, Target 6, is reported to exhibit a number of key geological similarities with Solgold’s Alpala project including secondary hydrothermal alteration analogous to that seen at depth at Alpala and the presence of “chalcopyrite, molybdenite and bornite. A- and B-type quartz veins … at variable density”.

The target is also “defined by strong copper, gold and diagnostic molybdenum anomalism over a large area 1.25km by 1 km” and is the highest priority target among six identified along the “contact between the Zamora batholith and volcanic units”.

Solgold says that the Santos Lindero zone lies in a geological setting “consistent with that of a preserved and mineralised Cu-Au-Mo system at depth.”

The company reports that the area was the source of rock chip sample results assaying at:

6.27% copper, 0.29g/t gold 22.9g/t silver and over 1% molybdenum; and

4.58% copper, 0.13g/t gold 14.6g/t silver and 0.16% molybdenum; and

4.15% copper, 0.24g/t gold 16.1g/t silver and 0.28% molybdenum; and

2.19% copper, 0.12g/t gold 9.11g/t silver and 0.02% molybdenum.

CEO, Nick Mather, said that “The commencement of drilling at La Hueca marks the start of SolGold’s next growth phase for the benefit of all shareholders and Ecuador. We have now extended that invitation to the shareholders of Cornerstone Capital Resources Ltd and continue to encourage them to accept the bid and share in our success as we grow”

Mr. Mather also reaffirmed that “SolGold is firmly dedicated to the long-term growth of Ecuador, and through the support of our predominantly Ecuadorean workforce and all levels of the social, environmental and regulatory frameworks in country, we are strongly placed to emerge as the resource mainstay of the country’s copper gold mining industry in years to come”.

Conclusion: Solgold continues to deploy the expertise it has honed at Alpala elsewhere in Ecuador. The start of drilling at La Hueca is following up a promising, high-priority target in southern Ecuador and we look forward to results from this initial drilling.

*SP Angel act as financial advisor and broker to SolGold



John Meyer – [email protected] – 0203 470 0490

Simon Beardsmore – [email protected] – 0203 470 0484

Sergey Raevskiy –[email protected] - 0203 470 0474



Richard Parlons –[email protected] - 0203 470 0472

Abigail Wayne – [email protected] - 0203 470 0534

Rob Rees – [email protected] - 0203 470 0535


SP Angel                                                            

Prince Frederick House

35-39 Maddox Street London



*SP Angel are the No1 integrated nomad and broker by number of mining brokerage clients on AIM according to the AIM Advisers Ranking Guide (joint brokerships excluded)

+SP Angel employees may have previously held, or currently hold, shares in the companies mentioned in this note.


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