SP Angel . Morning View . Thursday 07 01 21
Steel prices rise limit up in China
Altus Strategies* (LON:ALS) – BUY, 132p – Altus hits giant intersection of gold mineralisation
Arkle Resources* (LON:ARK) – Trenching at the Inishowen project identifies gold-bearing veins
Mkango Resources* (LON:MKA) – Approval for the exercise of warrants on amended terms
Ormonde Mining* (LON:ORM) – Further deferral of AGM
Rainbow Rare Earths* (LON:RBW) – Rainbow completes acquisition of Phalaborwa tailings and REE pilot plant
Power Metal Resources* (LON:POW) / Kavango Resources (KAV LN) – $150,000 paid ahead of schedule to progress Botswana JV
Trans-Siberian Gold (LON:TSG) – Two fatalities at the Asacha mine lead to suspension of Vein 25 operations while investigation proceeds
Versarien* (LON:VRS) – Versarien appoints Sr Stephen Hodge as Chief Technology Officer
Markets rise as Democrats take control of senate allowing Biden / Harris to push policies through the Senate as well as Congress subject to recount!
Gold falls on the news from Georgia suggesting that Biden may not be able to push as much stimulus through as envisaged.
Mike Pence certifies Joe Biden’s presidential victory as Trump finally concedes.
Republicans are rounding on Trump for losing the election. Maybe next time don’t push a reality TV star for President?
Capitol Hill is being cleared of protestors following the ‘pitch’ invasion last night.
From a policy perspective the Bidens’ victory is a bitter sweet meal from a policy perspective
New policies will need to get through rogue Democrats and Republicans with just a handful able to hold up legislation.
This may cause Biden to water down Democrat proposals with the inevitable ‘pork barrel’ politics that afflict Washington.
Democrat and Republican policies are relatively similar towards China, eg China needs to play fair to fit in with the West, but Biden is still likely to take a tough but more diplomatic approach which may allow China to give ground while saving face.
Biden’s fiscal stimulus is still likely to lead to greater inflation causing the dollar to weaken and US long bond yields to rise.
Dual Circulation & Stimulus: China is already promoting greater domestic consumption which should start to help the trade deficit with the US and may also stoke some inflation as the West competes with new Chinese consumers for goods.
China also signed a ‘CAI’ Comprehensive Agreement on Investment with the EU after 7-long years of negotiation, though that is an average negotiating time for the EU.
Chinese steel prices rise 5% on higher raw material costs – Inflation is coming
Chinese stainless steel futures on the Shanghai Futures Exchange rose to the day’s upside limit on Thursday, as higher nickel and iron ore prices drove prices higher.
The most-active March stainless steel contract on the ShFE rose to 14,725 yuan ($2,281)/t – the highest since October.
Nickel prices rallied along with other base metals, rising above $18,000/t for the first time since September 2019- with uncertainty in New Caledonia still fuelling supply worries.
Iron ore prices continued to rise on both the Singapore and Dalian exchanges, as Chinese steel mills continue restocking after the new year.
The most-active May contract on the Dalian Commodity Exchange rose 3.1% to 1,063 yuan/t, while the Singapore Exchange’s February contract rose 1.2% to $167/t (Reuters).
Ferro-Vanadium prices jump 5.7% in Europe to $25.95 - 27.45/kg
We believe the market in Europe is running short of ferro-vanadium as so much material is on slow-boats to China
The locking up of so much vanadium in transit to China is appears to be causing European buyers to scramble for material as shipments become harder to secure.
Rubbish European prices have caused producers to ‘suck up’ Chinese tariffs at 13% and longer transport times in return for significantly higher demand and pricing.
UK EV auto sales forecast to overtake diesel passenger vehicle sales this year SMMT ‘Society of Motor Manufacturers and Traders’.
EV battery and plug-in hybrid electric cars accounted for >1 in 10 registrations in 2020 up from ~1 in 30 in 2019.
Sales rose for ‘BEVs’ battery electric vehicles rose 186% to 108,205 vehicles
Registrations for PHEVs ‘plug-in hybrids’ 91% to 66,877 motors.
There are now > 100 plug-in car models are now available in the UK with >35 new EV models due in 2021 more than new planned petrol or diesel models combined.
IGTV: Is 2021 the start of the new COVID-Supercycle or will Lockdowns delay the recovery? https://youtu.be/7LO0tDc-pNc
As traders continue to bid up Tesla, is the EV sector approaching a bubble? https://youtu.be/LaDWBpTZ7SQ
Copper price rise: https://youtu.be/mdPXTup15VY
10/12/20: https://www.voxmarkets.co.uk/media/5fd228d9bc74c922485f501e/?context=/listings/LON/ARCM/multimedia/
US Election, China growth policies Solgold*, Mkango*, Rainbow Rare Earths*: https://youtu.be/YKk5-kVpVGE
EV revolution, gold and other ideas (Interactive Investor): https://www.youtube.com/watch?v=ja0IdjszfCc
Metals Markets: Are they totally dependent on stimulus? (IG TV): https://youtu.be/TOiSwRpgfKM
iiTV: The mining stock to own in 2021: https://www.youtube.com/watch?v=4x7SuSLQwCI&t=11s
Small Cap Mining Share tips for 2021 - https://www.youtube.com/watch?v=G_6RKAp91k4
Miners for a green industrial revolution - https://www.youtube.com/watch?v=rXlNS6JIDvg&t=3s
A Mining megatrend and three solid dividend stocks - https://www.youtube.com/watch?v=sH5r-QbTRwg
*SP Angel almost invariably acts as nomad or broker or nomad and broker to companies mentioned in the above videos and podcasts.
We speak about these companies as we have confidence in their management and assets and like them enough to want to work with them.
Because we work closely with these companies we have a good ongoing understanding of their business which gives us the confidence to recommend their shares to investors.
Dow Jones Industrials +1.44% at 30,829
Nikkei 225 +1.60% at 27,490
HK Hang Seng -0.52% at 27,549
Shanghai Composite +0.71% at 3,576
Economics
Service/nonmanufacturing and composite PMI’s show global recovery in December
We suspect new variants of the Coronavirus will cause economic activity in the services sector to fall again in many regions
China - nonmanufacturing PMI 55.7 in December vs 56.4 in November
Caixin services PMI 56.3 in December vs 57.8
composite 55.8 in December vs 57.5
US - Markit PMI 54.8 in December vs 58.4
composite 55.3 in December vs 58.6
JP Morgan global - services PMI 51.8 in December vs 52.2
composite 52.7 in December vs 53.1
EU - services PMI 46.4 in December vs 41.7
composite 49.1 in December vs 45.3
Japan - services PMI 47.7 in December vs 47.8
Composite 48.5 in December vs 48.1
India - services PMI 52.3 in December vs 53.7
composite 54.9 in December vs 56.3
Germany - services PMI 47.0 in December vs 46.0
composite 52.0 in December vs 51.7
France - services PMI 49.1 in December vs 38.3
composite 49.5 in December vs 40.6
UK - services PMI 49.4 in December vs 47.6
composite 50.4 in December vs 49.0
Brazil - services PMI 51.1 in December vs 50.9
composite 53.5 in December vs 53.8
Australia - services PMI 57.0 in December vs Nov 55.1
composite 55.6 in December vs 54.9
Japan – Prime Minister Suga set to impose one-month state of emergency in Tokyo
Japan is reportedly preparing to propose an emergency declaration from 8th of Jan to 7th of Feb, to combat transmission of the virus at bars and restaurants.
Japan has been less seriously affected than many other countries, but saw new daily infections top 6,000 for the first time on Wednesday.
Germany – Factory orders unexpectedly rise 2.3% in November
Germany’s factory orders unexpectedly jumped in November, as data released this morning showed that orders rose 2.3% from a month earlier – with analysts forecasting a 0.5% decline.
Intermediate goods rose 4.9%, while export orders to EU markets rose 6.1%, domestic orders rose 1.6% and non-eurozone export orders rose 0.9%.
Preliminary Dec CPI fell 0.3% (Nov -0.3%), yoy rose 0.5% (-0.8%).
UK – FTSE 100 hits 10-month high as vaccine progress continues to spur economic recovery hopes
The FTSE 100 closed at its highest level since February 2020 yesterday, led by gains in banking and energy stocks, Reuters reports.
The index rose 3.5% on Wednesday clocking a third consecutive session of gains, as HSBC, Barclays and Standard Chartered all posted large gains.
BP and Shell rose almost 6.5% on the back of crude oil gains as a result of Saudi Arabia’s decision to voluntary cut output.
UK new car sales fell 10.9% in December yoy vs -27.4% in November
Peru – 52m Covid-19 vaccine doses secured and expected to arrive this month
The world’s second largest copper producer has struck a deal to buy 38m doses of China’s Sinopharm vaccine and 14m doses from AstraZeneca.
Peru has the worst Covid-19 death rate out of any South American nation, however speedy immunization will hopefully reduce this.
Quick and effective immunization at mine sites should ensure copper production continues in 2021.
Currencies
US$1.2306/eur vs 1.2325/eur yesterday. Yen 103.37/$ vs 102.80/$. SAr 15.098/$ vs 14.981/$. $1.361/gbp vs $1.364/gbp. 0.778/aud vs 0.779/aud. CNY 6.457/$ vs 6.462/$.
Commodity News
Precious metals:
Gold US$1,921/oz vs US$1,949/oz yesterday
Gold ETFs 107.4moz vs US$107.4moz yesterday
Platinum US$1,105/oz vs US$1,103/oz yesterday
Palladium US$2,429/oz vs US$2,464/oz yesterday
Silver US$27.19/oz vs US$27.51/oz yesterday
Base metals:
Copper US$ 8,085/t vs US$8,087/t yesterday - Las Bambas mine protests holding up export of 189kt of cu concentrates (~57,000t of copper content).
Peru copper cu production fell 13.6% to 1.93m year-to-date.
Aluminium US$ 2,036/t vs US$2,056/t yesterday
Nickel US$ 17,960/t vs US$17,755/t yesterday
Zinc US$ 2,873/t vs US$2,850/t yesterday
Lead US$ 2,044/t vs US$2,083/t yesterday
Tin US$ 21,100/t vs US$21,265/t yesterday
Energy:
Oil US$54.5/bbl vs US$53.8/bbl yesterday –
Oil prices have surged more than 51% off the November lows with WTI rallying to fresh multi-monthly highs into the 2020 open.
Tuesday’s conclusion to the OPEC meeting saw the group agree to lift oil production by 75,000bopd over January levels, according to OPEC’s post-meeting press release
But Saudi Arabia’s late announcement after the meeting sent oil prices soaring—that Saudi Arabia would voluntarily cut an additional 1MMbopd in February and March above its current quota—all while OPEC’s allies get to ramp up production
Saudi’s action and the prospect for a tight market in 2Q 21, as the rebound in demand stresses the ability to restart production, will likely support prices in coming weeks.
The OPEC+ agreed not only for the production levels for February but also for March
March’s production level will see an additional increase of 120,000bopd over February levels, or 195,000bopd over January levels
With March’s production quotas already set, the February meeting, therefore, will set production quotas for April
The previous meeting held in December adjusted the total production cuts to 7.2MMbopd for January, from 7.7MMbopd before
But with Saudi Arabia’s additional voluntary cuts, February’s total production cuts will be 8.125MMbopd, and March’s will total 8.05MMbopd
For Saudi Arabia, there are no changes to its official output quota for either February or March
Neither are there changes to the UAE’s quotas or Iraq’s
In fact, for OPEC, there are no changes for February to the individual quotas
All the production increases, therefore, go to the non-OPEC members, not surprisingly to Kazakhstan and Russia
Natural Gas US$2.681/mmbtu vs US$2.619/mmbtu yesterday
Natural gas prices moved this morning, ahead of today’s inventory report from the Department of Energy
Expectations are for a 110Bcf draw according to survey provider Estimize
The weather is expected to be warmer than usual for the next 6-10 and 8-14 days in the northern part of the United States and cooler than usual in the country’s southern region
LNG exports were flat week on week, according to the EIA
Bulk:
Iron ore 62% Fe spot (cfr Tianjin) US$164.6/t vs US$162.8/t
Chinese steel rebar 25mm US$675.1/t vs US$675.5/t
Thermal coal (1st year forward cif ARA) US$69.6/t vs US$70.7/t - UK government backs plans for first new deep coal mine in 30 years
Communities Secretary has allowed the Woodhouse Colliery in West Cumbria to proceed, with the coal produced to be used in steelmaking rather than to produce electricity.
The mine is due to start production in the second half of this year, with West Cumbria Mining aiming to extract 3.1mt of metallurgical coal each year, creating as many as 500 jobs.
As expected, climate activists are upset at the decision to allow the mine to proceed – despite coal being sourced locally having fewer transport emissions and higher environmental standards than is likely with imports.
Coking coal swap Australia FOB US$136.0/t vs US$136.0/t
Other:
Cobalt LME 3m US$35,500/t vs US$34,000/t
NdPr Rare Earth Oxide (China) US$63,882/t vs US$63,528/t
Lithium carbonate 99% (China) US$7,976/t vs US$7,815/t
Ferro Vanadium 80% FOB (China) US$30.0/kg vs US$30.0/kg
Ferro-Manganese high carbon 78% Mn US$1,370/t vs US$1,330/t
Tungsten APT European US$230-235/mtu vs US$230-235/mtu
Graphite flake 94% C, -100 mesh, fob China US$520/t vs US$510/t
Graphite spherical 99.95% C, 15 microns, fob China US$2,475/t vs US$2,475/t
Spodumene 6% Li2O min, cif (China) US$395/t vs US$380/t
Company News
Altus Strategies* (LON:ALS) 93p, Mkt Cap £65.5m – Altus hits giant intersection of gold mineralisation
BUY – 132p
‘60m intersection grading 3.34 g/t Gold’
Drilling long intersections of mineralisation is rare in most exploration programs.
Hitting a long intersection of seemingly-mineable gold grades is exceptional.
Altus reports that it has done both at its Diba project in the West of Mali with 60m of 3.34g/t of gold.
Mineralisation starts effectively at surface at just 17m down the drill hole
The intersection also includes a higher grade section 13.60 g/t Au over 9m.
Key intersections from 4,800m over 52 holes in a 110 hole, 10,000m RC drill program: 3.34 g/t Au over 60m from 17m
Inc. 13.60 g/t Au over 9m
4.48 g/t Au over 15m from 22m
Inc. 7.18 g/t Au over 9m
22.11 g/t Au over 6m from 89m.
2.51 g/t Au over 12m from 3m
Inc. 3.32 g/t Au over 7m
The Diba NI-43 101 standard mineral resource estimate is for around 404,000oz with:
4,834,000 tonnes at 1.39 g/t Au for 217,000 ounces in the Indicated category.
5,479,000 tonnes at 1.06 g/t Au for 187,000 ounces in the Inferred category.
Further assay results from the balance of the drilling programme should come through shortly
Follow up drilling is planned for Q2 of 2021 to include currently undrilled prospects.
The results indicate two shallow-dipping and consistent zones of mineralisation over ~750m in strike
Another 5,200m is being drilled to test up to five priority prospects each located within 3km of the Diba Deposit with the new drilling is designed to test extensions to the Diba mineral resource.
Drilling along strike to the north and south and down-dip to the east is also testing potential for lenses to the west.
We now have assay results for 18 out of the 23 drill holes completed covering some 4,345m of drilling with three holes still to be drilled.
The results received to date confirm potential on strike and down dip extensions, including: continuation of mineralisation down-dip in the east
22.11 g/t Au over 6m from 89m downhole
0.73 g/t Au over 3m from 80m downhole
continuation of mineralisation up-dip to the west
0.54 g/t Au over 2m from 17m downhole
5.42 g/t Au over 2m from 46m downhole
along strike to the south
1.23 g.t Au over 5m from 87m downhole (20KSRC-009)
Metallurgical results on samples from Diba indicate 95.8% recovery rates from the oxides and 86.8% for CIL on the sulphides.
It is worth looking at the Schematic cross-section on the company website to gague the potential scale of the Diba orebody
https://www.altus-strategies.com/projects/korali-sud/
Location:
Diba and Altus’s Lakanfla target are also remarkably close to the Sadiola Mine offering the potential to share infrastructure in any future development.
IAMGold and AngloGold sold their jv interests in the Sadiola gold mine over Christmas to Allied Gold Corp. The Sadiola mine has reportedly run dry of ore suggesting that the plant may become available for third-party processing. Sadiola is just 134km to the north of Diba.
Agdz (Morocco) Altus also recently discovered a new copper/silver zone at Agdz project in central Morocco.
The new 450m long zone at Makarn North Prospect returned grades up to 3.50% Cu and 308g/t Ag in surface sampling.
Outcrop sampling at other prospects continued to generate encouraging results including:
3.59 % Cu and 149 g/t Ag from 1.4km long Makarn South Prospect
4.67 % Cu and 308 g/t Ag from 1.4km long Makarn North Prospect
2.45 % Cu and 2.25 % Cu from 2km long Amzwaro prospect
2.12 % Cu and 1.99 % Cu from 150m long Miniére Prospect
Conclusion: These are exceptional results by any standard indicating the probable development of a valuable gold mine at Diba. The team are targeting a 1moz resource at Diba with 0.5moz in their sights at Diba and another 0.5moz likely in the satellite gold deposits.
*SP Angel acts as Nomad and Broker to Altus Strategies plc
Arkle Resources* (LON:ARK) 2.1p, Mkt Cap £5.8m – Trenching at the Inishowen project identifies gold-bearing veins
Arkle Resources reported yesterday that its recent trenching programme at the Inishowen project area in Co Donegal has encountered outcrops of gold-bearing quartz veins in areas identified by anomalous concentrations of lead and zinc in the overlying soils.
The company says that “Of the eight trenching locations that were identified from the recent soil sampling survey, four located bedrock, with two sites returning gold grades of significance” and that “excavations at the farm and nearby quarry have also revealed new quartz vein outcrops which were all analysed for gold”.
Arkle Resources says that the “highest grade sample returned 40.7g/t gold which was retrieved from a 10cm quartz vein found in trench 3. This same vein was excavated at deeper levels down a further 50cm and 70cm where it was observed to be 7cm and 12cm wide grading at 4.18 and 3.63g/t gold respectively” and explains that “the vein is not consistent with grade or width and that there are high grade and low grade zones where a "nugget affect" may be at play”.
The announcement reports that the veining in trench 3 lies about 85m along strike from a borehole drilled in 2016 (Hole 16-MR-07) which “intercepted 10cm at 74.5g/t gold at 8.38m and 24cm grading 69g/t gold at 9.14m. Arkle Geologists believe that the new vein in trench 3 is connected with the veins in 16-MR-07 due to the orientation measurements obtained”.
A second trench (Trench 4) assayed 0.27g/t gold over a width of 70cm of a “wide grey clay shear zone … [which the company explains is a similar geological setting to mineralisation encountered at] … the Cavanacaw Gold Mine and the Curraghinalt Gold deposit which lie about 80km and 60km south respectively”.
Additional sampling “at the farm revealed a quartz vein outcrop measuring around 50cm wide containing lead and zinc ores (galena and sphalerite). The gold grade of this outcrop returned 13.1g/t. Further digging demonstrated the vein continued along strike but reduced in width and grade to 25cm at 4.22g/t gold, but then increased again to 50cm at 4.51g/t gold around 10m along strike from the original outcrop”.
Sampling in the quarry area, located over 0.5km from the main target area but along a similar strike suggests that “The main target area now extends over 750m”.
Chairman, John Teeling, confirmed that, following more detailed mapping of the area, the company is planning a drilling campaign in the spring.
Conclusion: Further mapping followed by a spring drilling campaign is planned to follow up mineralised veins identified by the recent trenching programme at Inishowen. We look forward to the results as the exploration progresses.
*SP Angel are Nomad and broker to Arkle Resources
Mkango Resources* (LON:MKA) 15.75p, Mkt cap £21.0m – Approval for the exercise of warrants on amended terms
(Mkango’s 75.5% subsidiary, Maginto Ltd holds a 25% stake in HyProMag which is a partner in the ‘Rare–Earth Recycling for E-Machines’ RaRE project)
Mkango Resources reports that it has now received the approval of the TSX-V for the previously announced amended terms for the cashless exercise of warrants which will increases Talaxis’ holding in the company from 10.7% to 11.3%.
In addition to its intetest in Mkango itself, “Talaxis maintains its 49% ownership in the Songwe Hill Rare Earths Project (the "Project") and its option to acquire a further 26% interest in the Project by arranging financing for project development”.
Today’s announcement reminds us that Talaxis “is a wholly-owned subsidiary of Noble Group Holdings Limited and invests in and develops projects that are related to technology metals, with a special focus on rare earth elements” and is funding the completion of a feasibility study to develop Mkango’s Songwe Hill rare earths project in Malawi.
*SP Angel act as Nomad and Broker to Mkango Resources
Ormonde Mining* (LON:ORM) 2.15p, Mkt Cap £14.1m – Further deferral of AGM
Ormonde Mining has confirmed that its 2020 AGM which was due to have been held today following earlier postponements has been further deferred until 18th February in order “to facilitate the Company continuing discussions with its largest shareholder in relation to … what the board believes will be an extremely value enhancing opportunity”.
The company confirms that “While negotiations, diligence and legal structuring of a potential transaction are well advanced, progress to completion has been slower than hoped for reflecting limitations resulting from the ongoing pandemic … [and cautions that] … There can be no certainty that a deal will be concluded.”
Ormonde Mining also advises that it plans to issue the circular for the EGM, also planned for 18th February, which will consider the “migration from the UK-based CREST Central Securities Depositary ("CSD") to Euroclear Bank of Belgium for the electronic settlement of trading in the Company's ordinary shares” in the near future. These measures are precipitated by the UK’s ‘Brexit’ which requires “all Irish listed companies whose shares are currently held and settled in the CREST system” to make alternative arrangements.
At this stage it is unclear whether by the time of the meeting shareholders will have received details of the proposed acquisition.
Conclusion: Ormonde Mining is postponing its AGM and EGM until 18th February when it will seek shareholder approval for the migration of settlement arrangements from CREST to Euroclear.
*SP Angel acts as Broker to Ormonde Mining
Rainbow Rare Earths* (LON:RBW) 8.9p, Mkt Cap £41m – Rainbow completes acquisition of Phalaborwa tailings and REE pilot plant
(Rainbow hold 70% of Phalaborwa with 30% to be held by Bosveld Phosphates. There is no BEE holding as this is a processing operation)
Rainbow reports the completion of the auger drilling programme on the gypsum tailings stacks at Phalaborwa in South Africa.
The assays should allow the calculation and confirmation of grade within the 35mt of tailings.
We are also interested to better understand the consistency of grade and metallurgy within the stacks.
The assays have gone to SGS laboratories in South Africa with results due in Q1
Metallurgy on the samples should enable some optimisation of the original process flow sheet developed by Sasol.
The pilot plant produced >3t of mixed rare earth carbonate and data from the early trials should help significantly.
The estimated average in-situ grade is 0.6% TREO, of which 30% is an estimated to be NdPr / Neodymium and Praseodymium which are principally used in permanent magnets for offshore wind turbines.
Phalaborwa’s tailings result from the processing and reprocessing of phosphate for fertilizer in a stacked gypsum residue.
The REEs are contained in chemical form having been ‘cracked’ by the Foskor and Sasol processes to release the refined phosphate.
The Foscor process creates gypsum and also concentrates other elements including the Rare Earth Elements within the residue.
Sasol’s pilot plant reported a 80% REE recovery producing ~3t of REE carbonate which was sold to a Japanese entity.
Sasol Nitrates were forced to abandon the phosphate mine and plant along with the REE project due to a South African anti-competition ruling in 2011.
50 years of mining and processing has resulted in 35mt of concentrated tailings grading 0.6% Total Rare Earth Oxides offering potential for low cost recovery.
By way of comparison Phalaborwa’s REE grades appear to run at around 10 times that seen in ionic clay deposits mined in China.
Capital costs should be lower than for a normal REE process plant as the REEs are already in chemical form.
The team should be able to refurbish parts of the original plant for a relatively quick restart of a value added product.
There is no mining required with tailings likely to be washed or loaded into the process plant at site.
Rainbow estimate the product should sell for around 80% of the total contained REE metal value vs just 30% of metal value for other REE carbonate offtake contracts.
Production of ~2mtpa of gypsum should realise ~10,000tpa of mixed rare earth carbonate a year
This is expected to realise around 3,100tpa of Neodymium and Praseodymium equivalent metal oxide over a 17 years.
Funding: Rainbow recently raised £2.56m at 6p/s in November last year
Rainbow are paying US$0.25m for the Phalaborwa project plus two further equal payments over the next 12 months in cash or shares.
Conclusion: The Phalaborwa plant could, in theory, generate around US$153m of sales a year assuming current NdPr prices, that there is sufficient demand to maintain these price levels and there are minimal losses in the plant.
*SP Angel act as broker and financial advisor to Rainbow Rare Earths
Power Metal Resources* (LON:POW) 3.3p, Mkt cap £31.3m – $150,000 paid ahead of schedule to progress Botswana JV
Kavango Resources (LON:KAV) 3.15p, Mkt cap £8.4m
Power Metal has elected to pay in full its $150k cash contribution into the strategic joint venture with Kavango Resources, in order to accelerate progress across the JV’s prospecting licences in both the South Ghanzi Project on the Kalahari Copper Belt and the Ditau Project.
The two companies announced the establishment of the JV on the 21st of September, which is co-owned by both companies and holds two prospecting licences in the Kalahari Copper Belt covering 1,294km2 targeting the discovery of large-scale copper/silver deposits; and Two prospecting licences covering 1,386km2 at Ditau, exploring 10 "ring structures" targetting potential rare earth elements ("REE) discoveries, hosted in carbonatites.
The South Ghanzi Project sits on the Kalahari Copper Belt, which is highly prospective and produced several large-scale copper/silver ore deposits, of which many are relatively close to surface.
Under the terms of the joint venture, Power Metals committed to paying for the first $75,000 of exploration expenditure incurred in each of Years 1 & 2 (totalling $150,000)- however the company elected to pay its second $75,000 a year early as a result of the rapid progress made at both South Ghanzi and Ditau.
Paul Johnson, Chief Executive Officer of Power Metal Resources commented: "The Strategic Joint Venture with Kavango is gathering considerable momentum with proactive exploration underway at the Ghanzi Project in the Kalahari Copper Belt and at the Ditau Project. Power Metal and Kavango are to accelerate the SJV both from an exploration and corporate perspective, including the plans for a potential listing on a North American or UK stock exchange as soon as practicable.”
Michael Foster, Chief Executive Officer of Kavango Resources, commented: "This early payment by Power Metals reflects the rapid progress we are making at South Ghanzi and Ditau. Initial results from both projects have been encouraging and we will now bring forward plans for more extensive and intensive exploration. If results continue to impress, this will put us on a quicker path to exploratory drilling later this year."
*SP Angel act as Nomad and Broker to Power Metal Resources
Trans-Siberian Gold (LON:TSG) 102.5p, Mkt Cap £90m – Two fatalities at the Asacha mine lead to suspension of Vein 25 operations while investigation proceeds
Trans-Siberian Gold has reported the death of two employees in a rock-fall while working on the Vein 25 section of its Asacha gold mine in the Russian Far East.
“A further three employees involved in the accident have been safely recovered from the mine” and operations have been suspended on the Vein 25 section pending investigation although the company confirms that “Mining operations at the Main Zone and the processing unit are continuing”.
At this stage, there is no indication on the length of the suspension of operations but the company confirms that it “has notified the relevant regulatory authorities and is providing them with its full support in the investigation process”.
The company also confirms that its “primary focus at this time is to provide its full support to the bereaved families and others affected”.
Conclusion: The news of the tragic accident at Asacha is a reminder of the real risks that mining can pose and we express our condolences to all those affected by this loss including the bereaved families as well as the colleagues of the deceased and the wider mining fraternity.
Versarien* (LON:VRS) 49.22p, Mkt cap £93m – Versarien appoints Sr Stephen Hodge as Chief Technology Officer
Versarien has promoted Dr Stephen Hodge to the board as Chief Technology Officer for the company
Dr Hodge was previously Principal Engineer at Cambridge Graphene a subsidiary of Versarien supplying graphene inks and other graphene materials
Stephen also held post-doctoral research associate positions at the Cambridge Graphene Centre, University of Cambridge and in the Department of Chemistry at Imperial College London, where he also completed a PhD in Nanomaterial Chemistry.
Stephen is also a member of the International Advisory Board for the Graphene NOWNANO CDT at the University of Manchester and was formerly a Teaching Fellow in the EPSRC Centre for Doctoral Training (CDT) program in Graphene Technology at The University of Cambridge.
Stephen also holds the role of Chairman of the Technical Working Group within the Graphene REACH registration consortium.
*SP Angel acts as nomad and Broker for Versarien. An SP Angel analyst has visited Versarien graphene manufacturing facilities.
Analysts
John Meyer – John.Meyer@spangel.co.uk – 0203 470 0490
Simon Beardsmore – Simon.Beardsmore@spangel.co.uk – 0203 470 0484
Sergey Raevskiy –Sergey.Raevskiy@spangel.co.uk - 0203 470 0474
Joe Rowbottom – Joe.Rowbottom@spangel.co.uk - 0203 470 0486
Sales
Richard Parlons –Richard.Parlons@spangel.co.uk - 0203 470 0472
Abigail Wayne – Abigail.Wayne@spangel.co.uk - 0203 470 0534
Rob Rees – Rob.Rees@spangel.co.uk - 0203 470 0535
Grant Barker – Grant.Barker@spangel.co.uk – 0203 470 0471
SP Angel
Prince Frederick House
35-39 Maddox Street London
W1S 2PP
*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.
Sources of commodity prices
Gold, Platinum, Palladium, Silver
BGNL (Bloomberg Generic Composite rate, London)
Gold ETFs, Steel
Bloomberg
Copper, Aluminium, Nickel, Zinc, Lead, Tin, Cobalt
LME
Oil Brent
ICE
Natural Gas, Uranium, Iron Ore
NYMEX
Thermal Coal
Bloomberg OTC Composite
Coking Coal
SSY
RRE
Steelhome
Lithium Carbonate, Ferro Vanadium, Antimony
Asian Metal
Tungsten
Metal Bulletin