SP Angel . Morning View . Wednesday 09 02 22
Gold climbs ahead of US inflation data due Thursday
MiFID II exempt information – see disclaimer below
Aura Energy* (Aura Energy Ltd (ASX:AEE, AIM:AURA)) – Plans to upgrade the Tiris uranium resource
Castillo Copper (Castillo Copper Ltd (LSE:CCZ, ASX:CCZ)) – Proposed ASX listing of BHA deferred while historic exploration data is assessed
Chaarat Gold (Chaarat Gold Holdings Ltd (AIM:CGH)) – Stronger commodity prices compensate for an increase in unit costs at Kapan, Tulkubash funding pushed out to H2/22
Fortescue (Fortescue Metals Group (ASX:FMG)) - plans huge 5.4GW wind, solar and battery storage hub in Pilbara
Hummingbird Resources (Hummingbird Resources PLC (LSE:HUM)) – Yanfolila drilling results
Oriole Resources (Oriole Resources PLC (AIM:ORR)) –Drilling results from Bibemi and trench results from Wapouzé
Rambler Metals & Mining* (Rambler Metals and Mining PLC (AIM:RMM, TSX-V:RAB)) – CLICK FOR PDF – Ming Mine turnaround gathers pace
Pre-IPO financing for Zambian exploration copper company – IPO planned for this summer
We are raising funds for a copper exploration company with three prospective license areas in Zambia, all near producing mines or active exploration programs by majors.
The company has a joint venture with one major mining company and is working in cooperation with another major copper miner.
Recent assays show 15.8% copper and 0.57g/t gold in an artisanal pit close to an historic copper mine on one license. Six significant copper soil anomalies identified in latest field work
Targets were also generated by BHP before they withdrew from Zambia and lie close to ongoing drilling by another company.
First Quantum’s geological team is providing data and technical advice, on the license contiguous with their largest Zambian mine.
Copper and nickel mineralisation has been identified on the license through historic drilling.
Please let us know if you are interested in participating in this pre-IPO financing
*SP Angel’s role is limited to making introductions and interested parties should be aware that investment in a private company can present certain risks not present in listed companies (e.g. limited or no liquidity and no rules compelling disclosure of information to investors). This offer is open to professional investors only and is not offered to retail investors.
IGTV: Are commodities becoming weaponised? https://www.youtube.com/watch?v=jCoPpdNPMpQ
IG Outlook 2022, China new year, winter Olympics may see metals prices soften: (12/01/2022): https://youtu.be/vNqDh74zW5I
VOX Markets: 12/01/22: https://audioboom.com/posts/8011559-john-meyer-on-china-s-factory-shut-downs-plus-news-from-bluejay-beowulf-atlantic-lithium
*SP Angel almost invariably acts as nomad or broker or nomad and broker to companies mentioned in the above videos and podcasts.
We speak more about these companies as we have a good understanding of their business and can talk with a greater degree of confidence. As ever, however, it should be noted that our views do not take into account the circumstances and needs of any particular investor or investor type. So enjoy the talks, but please do your own research, including other companies not mentioned by us but operating in the same areas, and get professional advice where appropriate.
China to regulate private capital flows
China has vowed to step up efforts to regulate and guide private capital, which would include setting clear boundaries and suppressing wild growth (Bloomberg).
Gold prices look set to run higher as inflation rises around the world
Inflation: Higher oil, gas and power prices have helped lift inflation and gold to $1,828/oz this week.
The market is expecting US inflation to hit an annualised 7.3% yoy for January while pricing in a 20% chance of 7 rate hikes this year.
Interest rates: While the move is tempered by the prospect of higher interest rates we feel US, UK and EU rates will remain at relatively low levels.
Government debt: The cost of servicing government debt which is at relatively high levels in the US, Japan, UK and EU will likely limit policymakers to modest and token rate rises.
Less indebted nations will be able to raise rates faster and further drawing capital into their treasuries and strengthening their currencies.
Stimulus: Congress is holding up Joe Biden’s $1.2tn infrastructure bill and other stimulus expenditure putting back and putting off projects that should be regenerating US infrastructure and helping to re-shore manufacturing from China.
Currencies: The impact may well be to weaken the US dollar, Yen, Sterling and the Euro putting pressure on the Chinese Yuan/Renminbi to rise assuming China is able to continue to contain the spread of Covid.
US Treasury yields: gold’s gains have been limited by US 10-Treasury year yields rising to near-2019 highs.
Ukraine: Tensions over the Ukraine and Taiwan present threats to supply chains and raise geopolitical risk adding to gold’s appeal.
Bitcoin: Volatility in Bitcoin and other crypto currencies are likely to reduce their appeal as will the seizure of $4.5bn worth of bitcoin stolen from the Bitfinex exchange by a hacker in 2016.
The US Justice Department have used bitcoin’s open ledger to trace the bitcoin back to the criminals who laundered the funds. Bitfinex is seeking the return of the stolen Bitcoin.
Gold prices should therefore continue to climb in a weakening US dollar environment.
Iceland – raises interest rates by 0.5% to 2%
AkzoNobel, Europe’s largest paint maker, warns of price increases between 14-16%yoy in Q1/22 citing inflationary cost pressures in the industry.
The Company expects supply pressures to ease mid-2021.
CEO said raw materials costs were starting to level off while availability of ingredients for its paints and coatings in Asia had improved, FT writes.
“It is not a wish or a hope, we see it happening right now… I think we will get back to something that resembles normal gradually by of the middle of the year… You can see the signs everywhere that it’s starting to normalise,” CEO said.
Global decarbonisation investment jumped 27% in 2021 to record $755bn
Global companies, governments and households increased renewable energy capacity spending by 6.5% to $366bn. (BloombergNEF)
$273bn was spent on EVs and charging infrastructure, up 77%.
Electrified heat spending hit $53bn and nuclear energy spending hit $31bn.
Of the $755bn spent on the energy transition in 2021, $733bn was spent on clean power and electrification.
Spending on hydrogen, CCS and sustainable materials fell $2.3bn to $24bn.
BloombergNEF predicts investment needs to triple to $2.1tn pa between now and 2025 and to double again to $4.2tn over the rest of the decade to hit net-zero by 2050.
Copper steady at $9,787/t as concerns rise of low stocks and supply disruptions
LME stocks are down 10% since January tightening available metal into the market as problems with the Las Bambas mine in Peru continue.
Global stocks across all three exchanges fell by 73kt in 2021 to January – the 4th consecutive annual decline.
Off-market stocks with LME delivery options fell by 115kt to Nov. 2021 with November end off-market stocks of 19kt the lowest since Feb. 2020.
Sliding stocks are primarily a result of ongoing robust China demand, with 2021 refined imports at 3.3mt, up from 2019.
Lithium prices continue to climb despite new high in global mine production
Global mined lithium production hit a record high of 100kt in 2021 – up 21% from 2020’s 82.5kt. (USGS)
Global consumption jumped 33% to 93kt in 2021 vs 70kt in 2020 on insatiable EV demand.
Chinese lithium carbonate prices up 35% month-on-month to record highs on strong EV demand.
400k EVs were registered in December. (China Automotive Technology and Research Center)
China continues to expand natural graphite production capacity as demand rises
China ramped up graphite production to 79% of global mined output to 820kt in 2021 from 762kt in 2020. (USGS)
76% of China’s graphite production was small flake in the +200-mesh range.
Global production climbed 7.6% from pandemic lows.
US graphite imports for consumption and apparent consumption jumped by 48% from in 2021 from pandemic lows.
Analysts expect a shortfall of 80kt of graphite in 2022 as EV demand continues to surge. (Benchmark Mineral Intelligence)
Average natural flake graphite prices rose 25% in the last 3 quarters of 2021. (WoodMac)
Dow Jones Industrials +1.06% at 35,463
Nikkei 225 +1.08% at 27,580
HK Hang Seng +1.88% at 24,787
Shanghai Composite +0.79% at 3,480
Economics
US – Trade deficit swells to record in 2021 on imports surge
The US trade deficit grew in 2021 to the largest on record, reflecting a surge in the value of consumer goods imports.
The Trade deficit rose to as $80.7bn from $79.3bn in December
The annual shortfall in goods and services increased for a second straight year, widening 26.9% to $859bn.
Annual imports climbed 20.5% to $3.39tn while exports rose 18.5% to $2.53tn.
Elevated savings led to a surge in inbound shipments of bigger ticket electronic items as American’s also invested in their homes.
The annual goods-trade deficit with China grew $45bn to $355bn according to US data.
China – Manufacturing sector’s share of GDP rose for first time since 2007
China’s manufacturing industry grew its share in the economy to 27.4% last year – the first gin in 14 years.
The gain was largely attributed to the slump in the services sector during the pandemic and the government’s efforts to promote factory production.
China developers cut back on land auction purchases in threat to economic growth
Private property developers bought 22% of residential land sold at national auctions last month. (WSJ)
This was less than 50% of their purchase amounts in 1H21.
The data reveals the effects of Beijing’s crackdown on property developers’ leverage with the ‘3 red lines’ limits.
Land auctions are a major source of revenue (40%) for local Chinese governments, with revenues down 7% in 2021 as a result. (China Index Academy)
This is the lowest level since 2014 and Fitch expects a 10-15% decline in new-home sales in 2022.
25/31 provinces have lowered their growth targets for the year. (SCMP)
Chinese regulators look to crack down on iron ore price misinformation amid recent rally
The NDRC has issued renewed warnings against the fabrication of iron ore prices as the steelmaking ingredient consolidates around $148/t.
Prices are up 20% ytd and 70% from November lows.
Beijing stated companies ‘should not fabricate or publish any false price information and should not drive up prices.’ (Reuters)
The statement caused Chinese iron ore futures to fall 5.8%.
Germany – Exports growth slowed down in December, although, the pullback was lower than expected.
The data further highlights weak end to the year with GDP recording a drop in the final quarter of the year.
Exports (%mom): 0.9 v 1.8 (revised from 1.7) in November and -0.5 est.
Imports (%mom): 4.7 v 3.4 (revised from 3.3) in November and -2.1 est.
Chile – Consumer prices rise at more than double expectations in January, up 7.7% YoY and 1.2% on month prior
Chile’s consumer prices are running wild, suggesting the central bank would do even more to control inflation.
The annual inflation rate of 7.7% in Jan is the 11th consecutive monthly rise.
Policy makers raised rates by 500bps to 5.5% since July, however this has not had the desired effect of bring inflation back in line with the country’s 3% target.
Peru – President Castillo names fourth Prime Minister in six months
The country’s justice minister, Anibal Torres, has taken over as the nation’s prime minister as Castillo aims to restore stability in the country.
Torres is an independent lawyer who doesn’t belong to any political party.
Former central bank economist Oscar Graham, popular with investors, will stay on as Finance Minister.
Investors will be looking at the leadership shake up closely for clues on policy, given the rise in resource nationalism in South American nations seen in recent months.
Supply chain bottlenecks should ease in the second half of the year, the second Danish container shipping group Maersk said.
The group reported a 55%yoy increase in revenues ($62bn) for 2021 with EBITDA tripling to $24bn.
“Exceptional market conditions led to record-high growth and profitability in AP Moller-Maersk, however it also led to supply chain disruptions and severe challenges for our customers,” Company’s CEO said.
Currencies
US$1.1413/eur vs 1.1405/eur yesterday. Yen 115.39/$ vs 115.42/$. SAr 15.338/$ vs 15.535/$. $1.355/gbp vs $1.353/gbp. 0.715/aud vs 0.713/aud. CNY 6.362/$ vs 6.369/$.
Commodity News
Precious metals:
Gold US$1,827/oz vs US$1,819/oz yesterday
Gold ETFs 99.4moz vs US$99.2moz yesterday
Platinum US$1,033/oz vs US$1,015/oz yesterday
Palladium US$2,248/oz vs US$2,220/oz yesterday
Silver US$23.16/oz vs US$22.87/oz yesterday
Rhodium US$17,900/oz vs US$16,925/oz yesterday
Base metals:
Copper US$ 9,782/t vs US$9,752/t yesterday
Aluminium US$ 3,170/t vs US$3,191/t yesterday
Nickel US$ 22,785/t vs US$23,215/t yesterday
Zinc US$ 3,589/t vs US$3,642/t yesterday
Lead US$ 2,209/t vs US$2,203/t yesterday
Tin US$ 42,820/t vs US$42,965/t yesterday
Energy:
Oil US$90.3/bbl vs US$92.0/bbl yesterday
A surprising update from the American Petroleum Institute (API) estimated the inventory draw this week for crude oil to be 2.025MMbbls after consensus predicted a build of 675kbbls
US crude inventories have fallen c.78MMbbls since the start of 2021
Last week the API reported a draw in crude oil inventories of 1.645MMbbls after consensus forecasted a build of 1.833MMbbls
Oil prices were trading down yesterday in the run-up to the data release on renewed fears that Iran and the US could be close to a nuclear deal that yield more legal barrels of oil from the currently sanctioned nation
US oil production has reversed its upward trend in the last few weeks
For the week ending 28 January, the last week for which the Energy Information Administration has provided data, oil production in the US slipped another 100,000bopd to 11.5MMbopd
This is down 1.6MMbopd from pre-pandemic levels
Natural Gas US$4.153/mmbtu vs US$4.296/mmbtu yesterday
The US Energy Information Administration bumped up its US natural gas demand and price forecasts for the first quarter of 2022, following a colder-than-normal January in the Northeast and Midwest and anticipating continued strong demand for US LNG exports
EIA, in its February Short-Term Energy Outlook, raised its natural gas consumption estimates by 3.42Bcf/d to 102.47Bcf/d for Q1, and by 650MMcf/d to 71.56Bcf/d for Q2
It also pushed up its consumption forecasts by 1.50Bcf/d to 84.27Bcf/d for 2022 on average, and by 1.01Bcf/d to 83.85Bcf/d in 2023
Colder-than-normal weather in January increased demand for gas used for space heating and power generation, the agency said, noting the spot price at Henry Hub averaged US$4.38/mmbtu for the month, up from US$3.76/mmbtu in January
Uranium UXC US$43.55/lb vs $43.90/lb yesterday
Bulk:
Iron ore 62% Fe spot (cfr Tianjin) US$148.3/t vs US$147.4/t
Chinese steel rebar 25mm US$778.4/t vs US$772.6/t
Thermal coal (1st year forward cif ARA) US$119.0/t vs US$117.0/t
Thermal coal swap Australia FOB US$211.0/t vs US$207.0/t
Coking coal swap Australia FOB US$406.0/t vs US$408.0/t
Other:
Cobalt LME 3m US$71,000/t vs US$71,000/t
NdPr Rare Earth Oxide (China) US$150,505/t vs US$150,333/t
Lithium carbonate 99% (China) US$59,338/t vs US$57,700/t
China Spodumene Li2O 5%min CIF US$2,710/t vs US$2,710/t
Ferro-Manganese European Mn78% min US$1,820/t vs US$1,819/t
China Tungsten APT 88.5% FOB US$320/t vs US$320/t
China Graphite Flake -194 FOB US$805/t vs US$805/t
Europe Vanadium Pentoxide 98% 10.0/lb vs US$9.9/lb
Europe Ferro-Vanadium 80% 39.25/kg vs US$39.25/kg
China Ilmenite Concentrate TiO2 US$391/t vs US$390/t
Spot CO2 Emissions EUA Price US$109.8/t vs US$109.4/t
Brazil Potash CFR Granular Spot US$805/t vs US$805/t
Battery News
Offshore wind could see installation vessel issues from 2024
The demand for vessels capable of installing offshore wind turbines could outweigh the supply by 2024, according to latest research from Rystad Energy.
Offshore wind installations could be slowed if operators do not invest in new or upgraded vessels.
Global demand for offshore wind turbine installation vessels (WTIVs), excluding China, is expected to surge to almost 79 vessel years by 2030, up from 11 vessel years in 2021 – most of this demand will be for 9MW+ turbines
There are currently 16 operational WTIVs globally, excluding mainland China, although several of these units are being outgrown by the increasing size of turbines.
There are currently 9 WTIVs under construction, with a further 14 potential newbuilds, but the supply could still struggle to meet demand within the next couple of year.
Recycled bulletproof vests used to increase energy density of EV batteries
Scientists at the University of Michigan have stabilised the chemical reaction between the lithium anode and the sulphur cathode in using a network of aramid nanofibers, recycled from Kevlar.
The study was done on Lithium-sulphur (Li-S) batteries which have advantages over Li-ion batteries including a much higher energy density and no cobalt – which is costly and vulnerable to fragile global supply chains.
Li-S batteries currently cannot be recharged enough times to be commercially viable because charging the battery causes a build-up of chemical deposits that degrade the cell and shorten its lifespan.
The researchers found that a Kevlar membrane prevents the build-up of chemical deposits, allowing for the lithium ions to flow between the battery’s anode and cathode, while also blocking the flow of the polysulfides.
The battery can last for 1,000 charging cycles and can increase the range of EVs by up to five times, the study shows.
Company News
Aura Energy* (Aura Energy Ltd (ASX:AEE, AIM:AURA)) 15.5p, Mkt Cap £64.5m – Plans to upgrade the Tiris uranium resource
Aura Energy has outlined its plans to upgrade its mineral resources estimate for the inferred portion of the Tiris uranium resource in Mauritania through infill drilling which it aims to complete by the middle of 2022.
Tiris currently has a Measured & Indicated resource of 39.2mt at an average grade of 226g/t U3O8 (containing 19.5m lbs of U3O8 with an additional 61.1m Inferred tonnes at a grade of 267g/t (36.0m lbs of contained U3O8.
The additional work will “focus on portions of the current Inferred Resource within the catchment area of the proposed plant site at Tiris East, to reduce drillhole spacing sufficiently to upgrade the classification of the Resource to Measured/Indicated status”.
Aura Energy says that “The previous resource drilling programme in 2017 focused on converting sufficient Inferred Resource to Measured and Indicated status to support the Tiris Definitive Feasibility Study, with the areas omitted from the 2017 program reasonably anticipated to be upgraded following similar drilling in the new programme”.
The company confirms that it “will cover the Tiris West resources in a separate future program”.
Commenting on the plans to upgrade the uranium estimate, acting CEO, Dr. Will Goddard, said that “We look forward to commencing the programme as soon as the necessary approvals are in place, as we continue to advance towards low emission uranium production at Tiris”.
Aura Energy has previously indicated that it is assessing the vanadium resource lying within the licence at Tiris with a view to potentially reducing costs of uranium production through developing a by-product revenue stream and today’s announcement confirms that “Resource estimation work is currently underway by independent consultants to enable a vanadium resource statement to be declared in compliance with JORC requirements” and the company confirms that this is to be a separate estimate from the uranium estimation work.
Conclusion: Aura Energy’s plans to upgrade the inferred portion of the Tiris uranium resource are expected to be complete by the middle of 2022 and with the inferred resources currently approximately 1.5x larger than the measured and indicated part it seems likely that the upgrade programme will increase the measured and indicated resources available for mine-planning by a meaningful amount. We look forward to news on drilling progress and the revised estimates.
*SP Angel acts as Nomad and Broker to Aura Energy
Castillo Copper (Castillo Copper Ltd (LSE:CCZ, ASX:CCZ)) 1.33p, Mkt Cap £16m – Proposed ASX listing of BHA deferred while historic exploration data is assessed
Castillo Copper reports that, as a result of assessing historic data, including 6,182 historic drill holes completed by the Broken Hill Group, on the East Zone of the BHA cobalt-copper-zinc project at Broken Hill in New South Wales, it has decided to defer its previously announced ASX IPO of BHA pending further geological assessment and the modelling of a “JORC 2012 compliant cobalt mineral resource estimate”.
The company says that its study of samples from the initial 108 of the historic drill holes all assayed at between 200-9,500ppm cobalt.
The company describes its work plan saying that “Once the geology team complete codifying the data, then geological modelling work will commence. In tandem, as there are seven reverse circulation and diamond core samples in storage, the geology team will re-assay these for cobalt and rare earth element mineralisation”.
Castillo Copper recently announced that it had dropped plans to purchase lithium exploration projects at Picasso and Litchfield in order to concentrate on the BHA project.
Conclusion: We await further news on the geological reassessment of the BHA Project
Chaarat Gold (Chaarat Gold Holdings Ltd (AIM:CGH)) 18p, Mkt Cap £124m – Stronger commodity prices compensate for an increase in unit costs at Kapan, Tulkubash funding pushed out to H2/22
FY21 Kapan production totalled 63.0kz GE including 14koz from 3rd party ore processing (FY20: 58.7koz and 5.5koz).
Production breakdown included 35.4koz Au, 510koz Ag, 2.3kt Cu and 5.8kt Zn (FY20: 29.8koz, 588koz Ag, 2.2kt Cu and 7.6kt Zn).
AISC (excl TC/RC and based on gold production rather than payable metal sales) climbed to $1,205/oz, up on $1,034/oz, on the back of higher mining costs due to more selective mining in the narrower parts of the underground mine and inflationary pressures.
Realised prices climbed strongly during the year especially for silver (+22.5%), copper (50%) and zinc (35%).
Kapan level EBITDA increased to $22.7m (FY21: $19m) as higher prices compensated for a decline in own mine production.
FY22 guidance is for 50-53koz GE from own ore and 6-9koz GE from 3rd party material for the total of 56-62koz GE.
Separately, the team is continuing with resource definition drilling at Kapan East Flank target for the MRE to be released towards the end of 2022.
At Tulkubash heap leach development project in Kyrgyzstan, construction works slowed during the year due to a delay in debt funding on the back of the ongoing dispute between the government and the Kumtor operation.
Main activities included detailed engineering, preparing the camp and related infrastructure, building the haul road and ordering long lead items for the 2022 construction season.
Additionally, the team completed ~4,800m of infill drilling as well as a BFS revisions in May/21.
Debt funding timeline target has now been pushed to H2/22.
Corporate debt outstanding stood at ~$39m as of Dec/21, down on ~$71m recorded the previous year on the back of debt to equity conversion during the year as well as a reduction in the Kapan acquisition related debt by $9m.
Fortescue (Fortescue Metals Group (ASX:FMG)) A$21.43, Mkt cap A$66bn - plans huge 5.4GW wind, solar and battery storage hub in Pilbara
Fortescue Metals Group (ASX:FMG) has unveiled plans to power its Pilbara mining operations with a multi-gigawatt scale renewable energy hub combining wind, solar and battery storage.
The plans for the 5.4GW project have been submitted to the Western Australia’s Environmental Protection Authority.
The project will be built by newly formed Fortescue Future Industries, and through its Pilbara Energy subsidiary.
The project proposes to generate electricity from up to 340 wind turbines, totalling more than 2GW, a solar farm, up to 3.3GW, and a BESS with up to 9,100MWh capacity.
The Pilbara renewable assets will be integrated with the company’s $700m Project Energy Connect, which includes a $250m transmission project that will install 275km of high voltage transmission lines connecting Fortescue’s mine sites and allowing them to be powered by renewables.
The project is part of Fortescue’s plan to achieve net zero operational emissions by 2030.
Fortescue also have ambitious plans to produce 15mt of green hydrogen per year by 2030, but would need around 200GW of wind and solar power.
Hummingbird Resources (Hummingbird Resources PLC (LSE:HUM)) 15p, Mkt Cap £56m – Yanfolila drilling results
The Company released final drilling results from the Yanfolila ~48,000m programme completed last year.
The announcement covers assyas from ~12,000m drilled at the Sanioumale East (SE) area and ~3,200m at the greenfield deposit (BBC).
SE results highlight the upside potential to the current mineral resource and reserves of 204okz and 100koz, respectively, with mining set to start in Q1/23.
Selected intersections included
4m at 64.68 g/t from 63m (SNEDD0005)
18m at 5.13 g/t from 7m (SNERC0511)
16m at 4.51 g/t from 138m (SNERCO438)
15m at 4.44 g/t from 75m (SNERCO476)
5m at 5.06 g/t from 99m (SNERC0495)
7m at 7.48 g/t from 46m (SNERC0479)
BBC drilling represented the first round of testing returning a number of high grade intersections demonstrating a potential for new resources to be established at Yanfoolila.
Selected intersections included:
2m at 6.22 g/t from 78m (KBCR0058)
3m at 4.05 g/t from 39m (KBCRC0035)
5m at 1.69 g/t from 4m (KBCR0045)
Latest drilling results will be incorporate into the geological model and updated MRE/Reserves to be released in Q2/22.
Oriole Resources (Oriole Resources PLC (AIM:ORR)) – 0.37p, Mkt cap £7.1m – Drilling results from Bibemi and trench results from Wapouzé
Oriole Resources reports that recently completed infill diamond-drilling at the Bakassi 1 Prospect at its 90% owned Bibemi prospect in Cameroon has intersected mineralised intervals of “up to 9.20 metres ('m') grading 1.31 grammes per tonne ('g/t') gold ('Au') and 2.10m grading 19.04 g/t Au including a bonanza intersection of 1.10m grading 36.06 g/t Au”.
The results confirm “the mineralised corridor at Bakassi Zone 1 extends over widths of up to 150m and to more than 1km along strike” with mineralisation open at depth beneath the 100m below surface drilled in the programme.
Among the results highlighted in today’s announcement are:
An intersection of 9.2m at an average grade of 1.31g/t gold from a depth of 84.90m in hole BBDD-042 which also intersected 1.1m grading 3.48g/t from 107.7m depth and 1.90m averaging 1.80g/t gold from 137.80m depth; and
An intersection of 1.00m at an average grade of 4.15g/t gold from a depth of 62.80m in hole BBDD-045 which also included intersections of 1.10m averaging 9.97g/t from 90.4m, 1.10m grading 17.70g/t from 124.50m and 2.50m grading 8.90g/t from 136m “including 1.30m grading 16.77 g/t Au”; and
2.00m averaging 2.82g/t gold from 63.10m in hole BBDD-046 which also contained 1.00m grading 6.78g/t from 110.00m and 2.10m grading 19.04g/t gold from 121.10m, including 1.20m grading 11.67g/t.
CEO, Tim Livesey said that the infill drilling had “given us such good correlation with previous intersections and we are working to continue the development of our exploration targeting model at Bakassi Zone 1. It is important to note that Bakassi Zone 1 remains open along strike in both directions and at depth”.
He said that the Phase 3 programme had “given us additional geological, structural and mineralisation data with which we move closer to the definition of an 'Exploration Target', under JORC rules”.
In a separate announcement today, Oriole Resources has also reported the results of soil sampling and trenching from the Bataol Zone of its Wapouzé exploration project located 20km north of the Bibemi project.
Trenching shows quartz hosted gold mineralisation within sedimentary schists with highlighted results including:
A 2m wide intersection at an average grade of 0.53g/t gold in trench WPT-006; and
A 2m wide intersection averaging 4.06g/t gold in trench WPT-007; and
A 1.50m wide intersection averaging 0.53g/t gold in trench WPT-008
The work follows up on an 8km long northeast trending soil anomaly identified in 2019 and a parallel 2.8km long anomaly
As well as the trenching, additional soil sampling covering the southwestern extent of the licences at Wapouzé announced today “confirmed continuation of the structural regime to the southwest, the anomalism is not well defined, perhaps reflecting the lack of competent host rock in the vicinity”.
Conclusion: Encouraging drilling results from Bibemi are improving geological understanding of the mineralisation and moving the project closer to being able to define a formal ‘Exploration Target’ while earlier stage exploration of the Wapouzé area 20km further north has encountered gold mineralisation in trenches. We await further news as the exploration proceeds.
Rambler Metals & Mining* (Rambler Metals and Mining PLC (AIM:RMM, TSX-V:RAB)) – 28.25p, Mkt cap £45m – Ming Mine turnaround gathers pace
We have published an updated research note on Rambler Metals & Mining. Please CLICK FOR PDF
NPV Valuation: 168p/s
An accelerating programme of underground development is delivering improvements in tonnages processed, grades, recovery rates and copper production at the Ming mine in Newfoundland.
The recent discovery of a new mineralised zone near existing underground infrastructure east of the main Lower Footwall Zone highlights the mine’s underexplored character.
Despite relatively low levels of past exploration, the mine has an established history of resource replenishment exceeding mining depletion with recent drilling showing both grades and mineralised widths improving at depth providing a long mine life with expansion potential.
As drilling ramps up and development accelerates, the turnaround of the Ming mine is now gathering momentum with copper output expected to double the 2021 levels in 2022.
Rambler Metals operates in an established mining jurisdiction rated among the 10 most attractive places for mining investment globally.
Based on SP Angel’s long term commodity price forecast of US$10,500/t copper, we estimate an NPV6% of US$362m or 168p/share.
*SP Angel act as Nomad and Broker to Rambler Metals & Mining
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