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Today's Market View - Bluejay Mining, Central Asia Metals, Eurasia Mining and more...

Bluejay Mining* (LON:JAY) – BUY, Valuation 37.7p – Analyst call Central Asia Metals (LON:CAML) – H1 performance and strong commodity prices deliver increased interim dividend and early repayment of debt Eurasia Mining* (LON:EUA) – Monchetundra detailed mining plan Jubilee Metals Group (LON:JLP) – Conditional placing to progress Zambian expansion

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SP Angel . Morning View . Wednesday 15 09 21

Lithium bid offers 79% increase in Pilbara Minerals tender

Gold, tin and aluminium continue to creep ahead

 

Pre-IPO financing opportunity for new gold mine development in Ghana

We are raising funds for an advanced gold project in Ghana with good upside exploration potential

The project offers potential to fast-track gold production using a low-cost heap leach.

Management are experienced and are looking to IPO within 18 months.

Please contact us if you are interested in pre-IPO funding of the opportunity

 

Bluejay Mining* (LON:JAY) – BUY, Valuation 37.7p – Analyst call

Central Asia Metals (LON:CAML) – H1 performance and strong commodity prices deliver increased interim dividend and early repayment of debt

Eurasia Mining* (LON:EUA) – Monchetundra detailed mining plan

Jubilee Metals Group (LON:JLP) – Conditional placing to progress Zambian expansion

Empire Metals* (LON:EEE) – Strategic technical review commenced at Eclipse project

Renascor Resources (ASX:RNU) – Major project status awarded by Australian Government

W Resources (LON:WRES) – La Parilla continues to improve performance in August

 

 Pilbara Minerals spodumene shipment attracts top bid of $2,240/t as lithium prices soar on tightening supply/demand

Pilbara Mineral’s second auction of spodumene concentrate attracted a top bid of $2,240/t for 8,000t on Tuesday.

The price represents a 79% rise on the $1,250/t received in the first tender on the web-based Battery Metal Exchange in late July.

The high value was driven by extremely tight supply condition and bullish downstream demand from the EV sector.

Last fiscal year (to June 2021) , Pilbara shipped ~280,000t of spodumene, planning to scale up to ~440-490kt in FY22.

The higher price is likely to encourage other lithium miners including: Kodal Minerals*, IronRidge* and Savannah Resources*

*SP Angel acts as nomad and broker. The analyst holds shares in Kodal Minerals

 

BYD promises 1,000km range in new EV platform

The Chinese automotive giant has launched its new “e-platform 3.0” which will bring to market the company’s advancements in intelligence, efficiency, and safety.

BYD says the new platform 3.0 will enable a range of more than 1,000km through a new electric powertrain and a 20 per cent increase in the thermal efficiency of the batteries. It will boast acceleration of 0-100km/h in only 2.9 seconds.

BYD’s focus is currently on its home market of China, but the company is slowly expanding into overseas markets – the first BYD Tang SUV was delivered in Norway in August.

Deliveries of the Yuan Plus are expected to start in Australia in April 2022, with BYD hoping to ‘shake up’ Australia’s EV market with an amazing price point.

 

Hydrogen fuel-cell trucks to be used by Ark Energy

Ark Energy Corporation, the Australian subsidiary of the world’s largest zinc, lead and silver producer, Korea Zinc has definitively confirmed an order for five Hyzon 154-tonne hydrogen fuel trucks for use at its Sun Metals zinc refinery.

Hyzon is obligated to deliver the trucks to Ark Energy by the end of 2022 and plans to assemble the trucks in Australia.

The trucks will be deployed in triple road-train configurations (towing three trailers) as part of the short-haul fleet operating on a 30km loop from the Port of Townsville to the refinery.

The trucks will be refuelled by Ark Energy’s own refuelling station, SunHQ Hydrogen Hub, which is at the Sun Metals refinery site.

Hyzon have also recently signed an MoU with HongYun Automotive, a Shanghai-based logistics company, to supply 500 hydrogen powered electric trucks – under the MoU, Hyzon will supply 100 49-tonne hydrogen fuel cell EVs by the end of 2021, with a further 400 to be fulfilled in 2022.

 

China steel and aluminium output plunges in August on climate policy

China’s steel and aluminium output fell sharply in August as the government’s efforts to promote energy efficiency and control emissions took hold.

Steel production fell 13.2% YoY to 83mt – the lowest reported figure since March 2020 when production collapsed due to the onset of the pandemic.

Steel output is still higher for the year – up 5.3% to 733mt over the first nine months of the year.

Aluminium production fell for a fourth straight month on the one prior, although was up slightly YoY – by 0.4% to 3.16mt.

Power saving initiatives implemented by Beijing have hampered aluminium production in China and helped prices rise to 15-year highs.

The production curbs could also open up China to more imports, which have already risen sharply since the pandemic.

Unlike coal and aluminium, Chinese coal producers managed to boost output in August – rising to a five-month high as mines reopened.

Despite the increased output, both thermal and coking coal futures have both risen to record highs, indicating the government’s efforts to reign in prices are falling well short.

 

Gold and the dollar flat as investors ambivalent following US inflation data

The gold price has remained flat this morning around the key resistance band of $1,800.

US inflation was slower than anticipated, however speculators believe this may delay a taper announcement.

Spot prices hit a peak of $1,808.50 following the release of the data but subsequently settled.

US consumer prices increased slower than the past 6 months which encourages dovish Fed members who emphasise the supposed ‘transitory’ nature of current inflation.

The dollar index remained between recent ranges of 92.3 and 92.9 following the news.

The data encourages Fed officials to ‘nullify any lingering pressure on the Fed to taper in September’.

Focus will be on the Fed’s meeting next week on the 21-22nd September.

 

Dow Jones Industrials ­-0.84% at 34,578

Nikkei 225 -0.52% at 30,512

HK Hang Seng -1.65% at 25,080

Shanghai Composite -0.25% at 3,653

 

Economics

US – Inflation miss in August offer more room for the Fed to delay bond purchases slowdown awaiting more evidence that the labour market is on a strong footing.

Equities climbed on the news while the US$ index pulled back seeing helping gold prices higher.

Softer than expected numbers were in part driven by re-opening sensitive categories of airline fares and hotel rates that may be an indication of stronger impact of the delta variant on consumer spending.

Additionally, prices for used cars and trucks reported the first decline since February while growth in rents consolidated around pre-pandemic levels.

CPI (%mom): 0.3 v 0.5 in July and 0.4 est.

Core CPI (%mom): 0.1 v 0.3 in July and 0.3 est.

CPI (%yoy): 5.3 v 5.4 in July and 5.3 est.

Core CPI (%yoy): 4.0 v 4.3 in July and 4.2 est.

 

China – Weak economic numbers released today further highlights waning local growth momentum with consumer spending seen pulling back on worse than expected virus outbreak.

Retail sales, industrial production and investments climbed slower than expected in August with consumer spending underperforming market estimates the most.

Spending was affected by stringent virus controls while more stringent property restrictions weighed on construction investment.

Retail sales were down 6.1%mom in August, marking the largest drop since the start of pandemic last year.

New cases pulled back to 50 with all of those reported in Fujian province, the place of the latest outbreak.

Authorities reimposed restrictions in a number of cities in the region to control the outbreak of the Delta variant.

Macau’s top gaming stocks lost a record $14bn in combined market capitalisation today on the news that authorities are to review regulations and tighten restrictions on operators.

The Bloomberg intelligence index of the six big casino operators dropped a record 19% in trading Wednesday before paring some losses.

Authorities at Macau, the only place in China where gambling is legal, said they would start a 45-day public consultation period today to review the status of existing and future licenses.

China’s retail sales growth fuels concerns over economic recovery

Retail Sales (%yoy): 2.5 v 8.5 in July. A Bloomberg survey had predicted a 7% rise for August, with the data stoking concerns over China’s recovery momentum.

Retails Sales (%YTD): 18.1 v 20.7 in July and 18.9 est.

Industrial Production (%yoy): 5.3 v 6.4 in July and 5.8 est.

Industrial Production (%YTD): 13.1 v 14.4 in July and 13.5 est.

FAI (%YTD): 8.9 v 10.3 in July and 9.0 est.

A spokesman for the National Bureau of Statistics believes the Chinese economy has maintained its recovery trend in August but that the ‘foundation still needs to be consolidated’.

Covid outbreaks and natural disasters have been noted as the predominant reasons behind the weaker-than-expected growth.

 

UK – Inflation picked up stronger than expected coming in at 3.2%yoy in August with the largest contribution reported from restaurants and hotels reflecting the low base last year.

Accelerating price gains is in line with BOE projections that previously expected consumer prices growth to hit a little below 4% by the end of 2021.

CPI (%yoy): 3.2 v 2.0 in July and 2.9 est.

Core CPI (%yoy): 3.1 v 1.8 in July and 2.9 est,

 

Australia – New South Wales, the most populous state, is ending the curfew on Sydney’s remaining Covid-19 hotspots as the state reached a vaccine milestone.

NSW administered at least one dose of a vaccine to 80% of its population with two doses given to 47.5%.

NSW reported 1,259 new local cases of the virus.

 

Currencies

US$1.1809/eur vs 1.1826/eur yesterday. Yen 109.55/$ vs 110.00/$. SAr 14.330/$ vs 14.146/$.  $1.383/gbp vs $1.387/gbp. 0.732/aud vs 0.734/aud. CNY 6.438/$ vs 6.443/$.

 

Commodity News

Precious metals:  

Gold US$1,800/oz vs US$1,793/oz yesterday

Gold ETFs 99.9moz vs US$99.9moz yesterday

Platinum (AIM:ZERO) US$934/oz vs US$960/oz yesterday

Palladium US$1,974/oz vs US$2,068/oz yesterday - Palladium prices hit lowest level in over a year

Palladium traded below $2,000/oz on Tuesday following a 6-session decline.

Palladium had hit $2,981.40 in May.

The price is its lowest in over 14 months as the current semiconductor chip shortage has limited demand.

The metal is predominantly used in catalytic converters in gas-powered vehicles.

The World Platinum Investment Council forecasts a transition from palladium to platinum in gas-powered vehicles.

 

Silver US$23.72/oz vs  US$23.73/oz yesterday

 

Base metals:  

Copper US$ 9,480/t vs US$9,488/t yesterday

Aluminium US$ 2,870/t vs US$2,848/t yesterday

Nickel US$ 19,660/t vs US$19,660/t yesterday

Zinc US$ 3,043/t vs US$3,051/t yesterday

Lead US$ 2,233/t vs US$2,275/t yesterday

Tin US$ 33,800/t vs US$33,497/t yesterday

 

Energy:           

Oil US$74.2/bbl vs US$74.0/bbl yesterday

Oil price continue to tick higher on the latest report from the American Petroleum Institute (API) on confirming a draw in crude oil inventories of 5.437MMbbls for the week ending 10 September

It exceeded market expectations who had estimated a loss of 3.903MMbbls for the week.

In the previous week, the API reported a draw in oil inventories of 2.882MMbbls, a smaller loss than the 3.832MMbbl draw that analysts had predicted.

Oil prices fell yesterday leading up to the data release, despite the volatile combination of IEA's expectations for a strong rebound in global oil demand starting next month and production disruptions due to Hurricanes Ida and Nicholas

Oil inventories have fallen more than 70MMbbls so far this year API data shows, and EIA suggests inventories are 6% under the five-year average for this time of year

For this week specifically, oil inventories were affected significantly by a sharp decrease in US oil production, which fell 1.5MMbopd last week, the sharpest single week decline since the EIA began tracking data, to just 10MMbopd as Hurricane Ida continued to shut in oil producers in the Gulf of Mexico

The API reported a draw in gasoline inventories of 2.761MMbbls for the week ending 10 September, compared to the previous week's 6.414MMbbl build

Distillate stocks saw a decrease in inventories this week of 2.888MMbbls for the week, compared to last week's 3.748MMbbl decrease.

Cushing inventories fell this week by 1.345MMbbls after last week's 1.794MMbbl increase

 

Natural Gas US$5.294/mmbtu vs US$5.215/mmbtu yesterday

 

Bulk:

Iron ore 62% Fe spot (cfr Tianjin) US$120.0/t vs US$124.1/t

Chinese steel rebar 25mm US$852.9/t vs US$857.7/t - Chinese data shows crude steel output in August down for a 3rd consecutive month

The impact of Beijing’s production curbs has been shown in official data from this morning after output continues to decline.

China produced 83.24Mt of steel in August, down 4.1% from July.

August 2020 saw 94.85Mt of crude steel output, with the 2021 figure marking the lowest output since March 2020 when the virus was rife.

Blast furnace capacity in China ran at 76% in August vs an average of 86.7% same period last year.

Iron ore prices have capitulated as a result, falling to $123/t.

Chinese iron ore futures hit a 9-month low.

Stainless steel futures rose 3.4%.

 

Thermal coal (1st year forward cif ARA) US$129.5/t vs US$130.0/t

Coking coal swap Australia FOB US$365.0/t vs US$360.0/t

China Ilmenite Concentrate TiO2 US$376.65/t vs US$376.4/t

 

Other: 

Cobalt LME 3m US$51,500/t vs US$51,500/t

NdPr Rare Earth Oxide (China) US$93,191/t vs US$92,968/t - Tech industry feels impact of soaring rare earth prices

A manager at a Chinese audio component maker has noted the ‘huge impact’ of skyrocketing praseodymium neodymium prices, stating that the high costs ‘knocked at least 20%’ off their gross margin.

The price of the key ingredient for the supplier for Lenovo laptops has increased 50% since June 2020.

It is expected that smaller tech firms producing electronics components will be hardest hit by rising rare earths prices, as they lack the ability to pass on costs to giants such as Apple and Samsung.

Analysts believe ‘the higher price of all kinds of basic key materials could become the new normal for the future’.

 

Lithium carbonate 99% (China) US$22,055/t vs US$21,573/t - Lithium miners and government ministers look to Argentina’s northern provinces as prices skyrocket

Argentina’s northern region of Salta is thought to contain the world’s 3rd largest lithium reserve.

Government officials are encouraging the exploitation of the region through increased infrastructure, lower tax rates and the removal of red tape in the sector.

Salta’s Secretary of Mining and Energy, Flavia Royon, believes the province could produce 200,000t pa of Lithium Carbonate by 2025 – 1/5th of forecast global production pa.

Consultants believe ‘Argentina could become the world’s leading producer from brines in less than a decade if the flow of projects is followed and maintained’.

The ‘lithium triangle’ of Argentina, Bolivia and Chile is gaining increasing interest from external parties as EV demand causes prices of the battery ingredient to boom.

China’s Ganfeng Lithium is currently bidding for Millennial Lithium (TSX-V:ML) which has a number of Argentinian interests.

 

China Spodumene Li2O 5%min CIF US$990/t vs US$990/t

Ferro-Manganese European Mn78% min US$1,825/t vs US$1,827/t

China Tungsten APT 88.5% FOB US$303/t vs  US$303/t

China Graphite Flake -194 FOB US$535/t vs US$535/t

Europe Vanadium Pentoxide 98% 8.9/lb vs US$8.9/lb

Europe Ferro-Vanadium 80% 35.25/kg vs US$35.75/kg

Spot CO2 Emissions EUA Price US$72.0/t vs  US$72.1/t

 

Battery News

Blyth-based gigafactory business Britishvolt earns $1bn+ valuation

Britishvolt’s latest series B fundraise from investors such as Glencore, Carbon Transition and NG Bailey has valued the company at over $1bn.

The start-up began construction of its Northumberland plant a few weeks ago.

It is expected that the plant will help advance the UK’s EV transition and carbon reduction goals.

It targets a capacity of 30 Gwh pa which can supply power to 300,000 EVs.

Production is expected by 2023.

 

Energy trade body says UK hydrogen could create 25,000 jobs

The Energy Network Association has said that plans to invest in hydrogen across the UK could create 25,000 jobs in the next decade.

The report sets out that companies are keen to invest:

£4.4bn to reduce emissions in the UK’s industrial clusters which are central to emission heavy industries such as chemicals, iron, steel, ceramics and glass – these projects are expected to generate 17,000 jobs.

£2.2bn into research on how to repurpose existing gas pipelines to make them hydrogen-ready which is expected to create around 7,000 jobs.

And approx. £150m to ensure wider energy systems are ready for hydrogen.

Around 25% of UK carbon emissions come from industry, so targeting ways to reduce emissions in these sectors will help the UK as it seeks to hit its climate goals.

 

Company News

Bluejay Mining* (LON:JAY) 11.52p, Mkt cap £112m – Analyst call

BUY – Valuation 37.7p

Bluejay Mining hosted an analyst call yesterday to discuss the company’s mine plans and exploration projects and ongoing strategy.

The company confirmed a positive dialogue with the newly elected government in Greenland and its exploitation license to mine at Dundas.

Bo Stensgaard the CEO, a geologist with extensive operational experience in Greenland continues to work on optimising the Dundas project.

Much of the optimisation appears to focus on the electrification of the mine for energy efficient ore transport alongside water and waste management.

This should reduce fuel, labour and maintenance costs while improving reliability.

The team are planning to mine all year round though shipping will be restricted to the relatively ice-free summer months.

Financing: Bluejay have Letters of intent from US EXIM Bank and three other Export Credit Agencies who view the mine as a simple sand mining and processing operation.

Offtake: Distribution agreement covers customers outside Asia and is with a very well known entity. The entity is viewed as blue chip by finance groups reducing the perceived risk by financiers. The agreement enables the mine to sell to a broad range of customers reducing the risk of selling to a smaller number of end users.

Shipping: Bluejay used an experienced Danish shipper for the shipment of 44,000t into Canada. This company has run shipments through the infamous North West Passage across the top of Canada marking a significant short cut to Asian markets.

Ilmenite market: Peter Waugh, a NED at Bluejay and expert in the titanium dioxide industry confirmed that demand is high amid constrained mine supply at present.

The availability of shipping for ilmenite is also problematic for producers and consumers alike reducing stock levels as smelters/converters keep pace with strong demand.

Certain deposits are being mined out while many other projects are driven by prices for zircon and rutile

Quality: Bluejay’s ilmenite is suitable for both the sulphate and chloride processes meaning that Bluejay’s 440,000tpa planned production rate is very small for its target markets.

Exploration:

Disko-Nuussuaq: There was no specific date set for the start of drilling on the Disko-Nuussuaq licenses but KoBold have had 6-9 months of technical due diligence and may be in a position to identify targets for drilling relatively quickly.

Enonkoski: Drilling has already started at $20m Enonkoski joint venture with Rio Tinto.

Conclusion: Optimisation continues on the Dundas project with no specific dates for the completion of the Dundas mine optimisation. Exploration work at Thunderstone, Enonkoski and Disko-Nuussuaq offer potential for new discovery.

*SP Angel act Nomad and broker to Bluejay. The analyst has previously visited the Enonkoski mine site in Finland. The analyst holds shares in Bluejay Mining.

 

Central Asia Metals (LON:CAML) 242p, Mkt Cap £408m – H1 performance and strong commodity prices deliver increased interim dividend and early repayment of debt

The company reports that net revenue of US$100.8m for the six months to 30th June 2021 (2020 – US$70.8m) resulting from strong commodity prices generated US$64.4m of EBITDA and US$48.9m of free cash flow (2020 US$42.5m and US$21.2m respectively).

The company is declaring an interim dividend of 8p/share (2020 6p/share) and reports that it has repaid US$10m of its corporate debt early “which takes us closer to the debt free milestone” and left the company with 30th June net debt of US$10.1m.

The result is driven by 6,214t of copper production from Kounrad (2020 – 6,607t) and 11,292t of zinc and 13,807t of lead in concentrates from Sasa (2020 – 12,203t and 15,140t).

The company confirms that it is on track “to achieve upper end of 2021 Kounrad production guidance and lower end of Sasa production guidance”.

We understand that current guidance is for “between 23,000 tonnes and 25,000 tonnes for zinc and between 30,000 tonnes and 32,000 tonnes for lead” from Sasa and in the range 12,500-13,500t of copper from Kounrad.  

Commenting on operational developments, CEO, Nigel Robinson, confirmed that “We have advanced our Cut and Fill Project …  which is on track and on budget for commissioning in the last quarter of next year. During the period, development of the new Central Decline has commenced, all major components for the Paste Backfill Plant were ordered and plans for the Dry Stack Tailings part of the project are also advancing”.

 

Eurasia Mining* (LON:EUA) 31p, Mkt Cap £865m – Monchetundra detailed mining plan

The Company updated the mining plan for the palladium rich flagship Monchetubdra project in Russia.

Updated mine plan open pit optimisation envisages Phase One annual ore production to increase to 1.7mtpa from 1.0mtpa included in the Russian Feasibility Study (Apr/17).

Ore to be sourced from Loipishnune and West Nittis open pits with respective grades of 1.8g/t Pd (3.1g/t PdEq) and 2.6g/t Pd (3.5g/t PdEq).

Higher throughput is estimated to see +70% increase in annual production with the operation potentially running at 128kozpa PdEq.

Phase One is based on exclusively Loipishnune and West Nittis open pits and is not taking into account potential material Monchetundra Flanks and Rosgeo JV projects.

Access to infrastructure including local power grid sourcing electricity from hydro and nuclear power generation sites to reduce development capital requirements as well as support ESG credentials of the operation.

Hydro and nuclear power sources utilised at 40-60% are available in the area with a HV powerline passing over the mine site.

All year highway connected to the site and railway is located within a few kilometres to the site.

Murmansk seaport operates throughout the year without freezing.

The nearest airport is Murmansk with numerous daily flights to Moscow/Saint Petersburg.

Labour is expected to be supplied from four nearby mining towns including Monchegorsk, Apatity (80km), Kirovsk (80km), Olenegorsk (35km).

 

Jubilee Metals Group (LON:JLP) – 16.5p, Mkt cap £378m – Conditional placing to progress Zambian expansion

Jubilee Metals has announced a conditional placing to raise £30m through the issue of new shares at a price of 16.03p/share in order to expand its Sable copper/cobalt refinery and progress its tailings recovery projects at Kitwe, Mufulira and Ndola.

The company says that the “Placing Shares, assuming full take-up, will represent approximately 7.7 % of the Enlarged Issued Share Capital”.

The proceeds of the placing are “in part allocated to the expansion of Sable Refinery to increase the copper sulphide recovery circuit previously limited under the Project Roan joint venture agreement as well as expanding the cobalt recovery circuit as part of the process development and testing for the cobalt solution at Project Elephant … [the Kitwe tailings project]”.

At completion of recent transactions Jubilee Metals will hold 100% of both the 14,000tpa of copper capacity Sable Refinery and the Ndola tailings project known as Project Roan plus an 80.75% interest in the 114mt Kitwe tailings project (Project Elephant) and a 97% interest in the Mufilira tailings.

During 2020, the company “entered into various joint venture agreements to secure rights to process over 300mt of copper and cobalt containing tailings in Zambia … located in three central locations”.

The company describes a two-part strategy for its Zambian development comprising:

A “Southern Refinery Strategy (14 000tpa capacity) which incorporates the Sable Refinery together with Project Roan located in the Ndola area”; and 

A “Northern Refinery Strategy (17 000tpa capacity) which incorporates the newly targeted refinery at Mopani, called Leopard together with the copper tailings project in the Luanshya area, called Project Lechwe (previously Elephant 1), as well as the copper and cobalt tailings in the Kitwe area called Project Elephant (previously called Elephant 2). Jubilee has secured additional copper and cobalt tailings at Mufulira which is currently being sampled to confirm the quantity and quality and will form part of the Project Elephant resource”.

CEO, Leon Coetzer, explained that 100% ownership of the Sable Refinery and the Ndola tailings allows “us the complete flexibility to better integrate Project Roan with the refining capability at Sable Refinery.  We are now able to increase the copper sulphide section of our refinery to fully absorb this portion of Project Roan's production that previously was allocated to be sold as a high grade concentrate under the terms of the joint venture while only the copper oxide was targeted to be fully refined to copper cathode”.

He also clarified that “The transaction at Project Elephant … [Kitwe] …  targets the richest tailings dam, TD52 at Elephant, where Jubilee's process development centre has confirmed very promising results from the cobalt recovery with potential to significantly increase the overall project economics. The third transaction increases Jubilee's beneficial interest to 97% at the Mufulira Project.

Zambia: the newly elected president, Hakainde Hichilema, has moved amazingly quickly to resolve corruption issues in the country. President Hichilema was formerly CEO of Coppers and Lybrand and Grant Thornton in Zambia indicating his in-depth knowledge of business and the importance of CSR and compliance.

As part of the anti-corruption drive the new Minister of Mines, Paul Kabuswe has suspended mining activities at all dumpsites, known as black mountains, KAbuswe has called for sanity and order to be restored in the operations while it promotes small-scale mining on these sites. Paul Kabuswe has replaced the former minister of mines Richard Musukwa in the new government, a move that is seen by some as part of Hichilema’s anti-corruption drive.

Former President Edgar Lungu had previously handed “over 10% shares of the black mountain to the youths on the Copperbelt saying the move was aimed at empowering the unemployed youths in the province” (Lusaka Times)

*An SP Angel mining analyst visited certain Jubilee Metals Group assets in Zambia in 2018

 

Empire Metals* (LON:EEE) 1.75p, Mkt cap £6.1m – Strategic technical review commenced at Eclipse project

Empire reports that it has commenced a strategic technical review focusing on the structural controls on known gold mineralisation and an appropriate exploration programme to unlock the full potential of the Eclipse project.

Drilling to date has confirmed that gold mineralisation is associated with a NW-striking and steeply SW-dipping shear zone, with significant gold mineralisation known to extend over a strike length of more than 200m.

Empire suspect mineralisation to connect to the Jack's Dream area further to the NW giving a total known strike length of the Eclipse system of some 500m.

High grade mineralisation has also been intersected at Twin Shaft about 120m south of the Eclipse shear, although it is not yet clear whether mineralisation in the Eclipse area is part of a linked shear system, or separate sub-parallel shear zones.

Strong weathering extends to 30-50m below surface and shallow RC drilling demonstrates that gold is extensively leached within the weathered zone.

Locally high gold grades within the weathered zone may reflect gold encapsulated within quartz veining, although it appears that the bulk of the gold associated with altered wallrock has been removed or remobilised.

Further exploration is required to understand the gold mineralised system at Eclipse, including drilling and surface geochemistry.

Shaun Bunn, Managing Director, said: “Whilst our initial focus was on a near-surface, laterite-hosted deposit we now believe the high-grade targets will most likely be found slightly deeper at the fresh rock interface, both down dip and along strike of the current workings.”

“We are also focusing on the wider potential that is offered by combinations of the Eclipse lode with the Jack's Dream extension and the recently discovered Twin Shaft lode to see if a larger mineralised inventory can be established prior to commencing further mine optimisation studies”.

*SP Angel act as nomad and broker to Empire Metals

 

Renascor Resources (ASX:RNU) A$0.16p, Mkt Cap A$299m – Major project status awarded by Australian Government

Rensacor report that e Minister for Industry, Science and Technology, the Hon Christian Porter MP, has awarded Major Project Status to Renascor’s planned Siviour Battery Anode Material operation.

The grant of Major Project Status is a recognition of the strategic significance of the Siviour Project in contributing to Australia’s Critical Mineral Strategy 2019 and the Resource Technology and Critical Mineral Processing National Manufacturing Priority Roadmap.

The Siviour project integrates the Siviour Graphite Deposit in South Australia and a state-of-the-art processing facility in South Australia to manufacture Purified Spherical Graphite through Renascor’s eco-friendly, HF-free purification process.

The awarding of Major Project Status provides Renascor with extra support from the Major Project Facilitation Office Agency, including a single entry point for Australian Government approvals, project support and coordination with State approvals.

 

W Resources (LON:WRES) 6.95p, Mkt Cap £7.8m – La Parilla continues to improve performance in August

W Resources reports a continuing operational improvement at its La Parilla mine in Extremadura, Spain during August.

The company reports a 16% rise in production of tungsten concentrates during August to 67.7t (July – 58.3t).

Tin concentrate output was, however, 19% lower than July’s 9.8t at 7.9t “due to reprocessing issues impacting recovery”.  The company says that it is taking steps to improve this situation.

Chairman, Michael Masterman, attributed the improvement in tungsten concentrate output to regaining of access to higher grade ore and improvements in recovery rates to a record 65%

W Resources confirms that a 7-day / 24hour working week was implemented on 7th September which is expected to improve future production levels.

Mr. Masterman explained that “Our current priority is to build production and improve tin recoveries and we remain positive about reaching our production target of 1,000t of concentrate in 2021 and increasing the production run-rate in Q4 2021 towards our T2 Target of 675t per quarter”.

Conclusion: After completing the water containment dam and regaining access to higher grade ore in late June, La Parilla’s tungsten concentrate production has picked up during both July and August although tin recovery continues to be a challenge. The operational improvements in conjunction with a shift to round-the-clock operations gives the company confidence in its ability to achieve its target of 1,000t of concentrate production for 2021.

 

 

No.1 in Copper:  “The winner of the 2020 Fastmarkets Apex contest for copper was the team at SP Angel comprising John Meyer, Sergey Raevskiy and Simon Beardsmore, with an  accuracy score of 93.8%”

No1. In Gold:  “SP Angel’s trio took the top spot for the gold price prediction throughout the year, with an accuracy score of 97.59%”

The SP Angel team also ranked 1st in Palladium, 3rd in Tin and 5th in Silver in the fourth quarter of 2020

 

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, Tungsten, Spodumene, Ferro-Manganese, Graphite

Asian Metal

 

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