SP Angel . Morning View . Tuesday 17 05 22
Base metals rebound from year-to-date lows on signs Covid easing in China
MiFID II exempt information – see disclaimer below
Graphite / graphene – private company financing closing this week
- We are inviting investors to finance a private company which produces high-grade graphite and graphene from lower grade graphitic material.
- Products: Graphene paint which blocks electromagnetic radiation/signals, Li-ion battery anodes in development, Concrete modifier
*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.
Anglo Asian Mining PLC (AIM:AAZ, OTC:AGXKF)* - BUY – Earnings slide on lower production and cost inflation; organic development pipeline increasingly pivots towards copper
Atlantic Lithium Limited (AIM:ALL)* – US to support battery metals projects in sub-Saharan Africa
Base Resources Limited (AIM:BSE, ASX:BSE) – Analyst roundtable offers encouragement
Cornish Metals Inc (AIM:CUSN, TSX-V:CUSN, OTC:SBWFF)* - Valuation 48p/s - Stringers of cassiterite mineralisation in granite host rock highlights lode structure
Corcel PLC (LSE:CRCL) – Wowo Gap nickel/cobalt resources estimate
Galileo Resources PLC (AIM:GLR) – Progress at Luansobe, Zambia
Rambler Metals and Mining PLC (AIM:RMM, TSX-V:RAB)* – NPV Valuation: 168p/s - Guidance for 7,000t of copper production in 2022 confirmed as production grows and fixed price sales agreement for copper sales falls away.
Tertiary Minerals PLC (AIM:TYM)* – Initial drilling results from the Jacks copper project, Zambia
Zamare* (Private) – Zamare acquires Kamoa-style copper exploration licence in NW Zambia
Base metals rebound from year-to-date lows on signs Covid easing in China
- Optimism surrounding Covid transmission in major Chinese cities has led prices higher this week.
- Shanghai has reported three days of zero community transmission, meaning officials may start dialling back lockdown that is hampering the Chinese economy.
- Metals are also rebounding after the PBoC said over the weekend that it would cut rates on new mortgages – reinforcing expectations for stable economic growth.
- Copper rose 0.9% earlier this morning, zinc +1.7%, lead +1%.
Lithium sector needs $42bn investment by the end of the decade in order to meet demand
- The global lithium sector requires $7bn of investment each year from now until 2028, according to Benchmark Mineral Intelligence.
- That would help it meet forecast demand of 2.4mt a year by 2030, which is four times higher than the 600,000t that’s estimated to be produced in 2022.
- Benchmark comment that Europe and North America look to reduce their dependency on Chinese imports could require around twice as much capital than relying on China.
- The Biden administration has earmarked $3bn in grants to help process elements including lithium while Canada has committed up to C$3.8 billion ($2.9 billion) in this year’s budget to build a domestic critical metals supply chain.
Dow Jones Industrials +0.08% at 32,223
Nikkei 225 +0.42% at 26,660
HK Hang Seng +3.03% at 20,555
Shanghai Composite +0.65% at 3,094
Economics
US – Equity futures are trading higher this morning amid elevated volatility as the combination of high inflation and prospects for tighter monetary policy fuelled fears of a potential recession.
- The US$ index is pulling back after hitting a multi decade high late last week helping US$ denominated base and precious metals.
- New York Manufacturing gauge contracted for second time in three months in May strongly underperforming estimates.
- Being one of the first regional Fed manufacturing numbers to be released, the report raises concerns over further slowdown in economic activity.
- Retail sales data to be released later today are for April with estimates guiding for a pick up in growth, although, consumer spending may start slowing down as indicated by latest sentiment surveys.
- Empire Manufacturing: -11.6 v 24.6 in April and 15.0 est.
Eurozone – Q1/22 growth was revised higher from earlier estimates as the region moved past a wave of Covid-19 infections.
- Latest estimate stood at 0.3%qoq, up on a flash reading of 0.2%qoq.
- Despite a positive revision, growth outlook has deteriorated lately amid surging energy and food prices, ongoing war in Ukraine and Covid related disruptions in China with the EC cutting growth projections for 2022 (2.7% vs 4.0% previously).
Covid – China still in early days of Covid spread as authorities move to lockdown further cities
- Residents have been locked down in Shanghai for 43 days.
- New Yuan loans by Chinese banks fell 80% in April to CNY645.4bn vs CNY3,130bn in March the lowest since December of 2017.
- This is said to be well below market expectations for CNY1,515bn.
- Total Social Financing, (TSF) also fell to CNY910.2bn in April vs CNY2,150.0bn.
- M2 money supply rose 10.5% yoy its strongest increase since November 2020 vs market forecasts of 9.9%
- 41 Chinese cities accounting for 30% of GDP are thought to be in full or partial lockdown according to reports
- Output of 10 nonferrous metals rose 1% to 5.53mt (National Bureau of Statistics)
- Crude steel output rose 5.1% to 92.78mt
HK - Hang Seng stock index extended gains to >6% on report that China Vice Premier will promote healthy development of the digital economy
Italy - Trade Balance Total €-84m vs €-1662m
- Trade Balance with the EU €420m in March vs €-115m previously.
India – wheat export ban likely to further stoke inflation for basic food products
- Not only is India buying discounted oil from Russia but it is also banning the export of wheat highlighting their long-standing protectionist ideology
Currencies
US$1.0466/eur vs 1.0405/eur yesterday. Yen 129.34/$ vs 129.00/$. SAr 16.064/$ vs 16.310/$. $1.240/gbp vs $1.223/gbp. 0.701/aud vs 0.689aud. CNY 6.755/$ vs 6.800/$.
Commodity News
Precious metals:
Gold US$1,826/oz vs US$1,808/oz yesterday
Gold ETFs 105.0moz vs US$105.2moz yesterday
Platinum US$944/oz vs US$943/oz yesterday
Palladium US$2,012/oz vs US$1,969/oz yesterday
Silver US$21.61/oz vs US$21.08/oz yesterday
Rhodium US$16,100/oz vs US$16,00/oz yesterday
Base metals:
Copper US$ 9,310/t vs US$9,191/t yesterday
Aluminium US$ 2,831/t vs US$2,829/t yesterday
Nickel US$ 26,320/t vs US$27,175/t yesterday
Zinc US$ 3,618/t vs US$3,535/t yesterday
Lead US$ 2,112/t vs US$2,092/t yesterday
Tin US$ 33,100/t vs US$33,900/t yesterday
Energy:
Oil US$114.0/bbl vs US$109.9/bbl yesterday
Natural Gas US$8.043/mmbtu vs US$7.805/mmbtu yesterday
Uranium UXC US$49.90/lb vs $51.05/lb yesterday
Bulk:
Iron ore 62% Fe spot (cfr Tianjin) US$129.8/t vs US$129.3/t
Chinese steel rebar 25mm US$725.66/t vs US$723.1/t
Thermal coal (1st year forward cif ARA) US$248.5/t vs US$248.5/t
Thermal coal swap Australia FOB US$377.0/t vs US$362.5/t
Coking coal swap Australia FOB US$485.0/t vs US$485.0/t
Other:
Cobalt LME 3m US$75,000/t vs US$82,000/t
NdPr Rare Earth Oxide (China) US$136,9155/t vs US$134,958/t
Lithium carbonate 99% (China) US$63,425/t vs US$62,882/t
China Spodumene Li2O 5%min CIF US$4,020/t vs US$4,020/t
Ferro-Manganese European Mn78% $1,816/t vs US$1,806/t
China Tungsten APT 88.5% FOB US$336/t vs US$338/t
China Graphite Flake -194 FOB US$815/t vs US$815/t
Europe Vanadium Pentoxide 98% 10.1/lb vs US$10.3/lb
Europe Ferro-Vanadium 80% 40.75/kg vs US$40.75/kg
China Ilmenite Concentrate TiO2 US$366/t vs US$366/t
Spot CO2 Emissions EUA Price US$92.7/t vs US$91.7/t
Brazil Potash CFR Granular Spot US$1,215/t vs US$1,215/t
Battery News
Company News
Anglo Asian Mining PLC (AIM:AAZ, OTC:AGXKF)* 81p, Mkt Cap £92m – Earnings slide on lower production and cost inflation; organic development pipeline increasingly pivots towards copper
BUY
- Revenues totalled $92.5m (FY20: $102.1m) reflecting lower production at the Gedabek gold/copper processing complex in Azerbaijan.
- Production amounted to 64.6koz GE including 48.7koz gold, 155koz silver and 2.6kt copper (FY20: 56.9koz, 123koz and 2.6kt, respectively).
- Gold bullion sales (net of PSA) were 39.6koz at an average realised gold price of $1,799/oz, in line with average spot prices (FY20: 48.7koz and $1,777/oz).
- Copper concentrate sales generated $23.7m (net of PSA) (FY20: $17.7m) driven by stronger copper prices in 2021 ($9,294/t v $6,185/t in 2020).
- AISC averaged $843/oz (FY20: $702/oz) on the back of lower production as well as cost inflation recorded during the year.
- EBITDA came down to $29.2m (FY20: $52.9m) implying 32% EBITDA margins (FY20: 52%).
- PAT and EPS dropped to $7.4m and 6.4c, respectively (FY20: $23.2m and 20.3c).
- Capital costs included $6.2m covering stripping costs of $2.0m and mine development costs of $2.5m (FY20: $10.5m).
- Exploration related costs amounted to $7.6m (FY20: $5.3m) predominantly reflecting work completed at Gedabek ($6.9m) with the balance split between Gosha ($0.6m) and Ordubad ($0.2m).
- FCF amounted to $12.2m (FY20: $33.8m) that after accounting for ~$11m in dividend payments in FY21 and first tranche of the Libero investment (~$2.1m) in Dec/21 meant that cash balance was little changed on the year.
- The Board proposed a final dividend of 3.5c taking the total for the year to 8.0c, compared to 9.5c last year that also included a special 1.5c payment.
- Closing cash balance stood at $29.4m with a further $8.0m in gold dore and copper concentrate unsold inventories as of Q1/22 (Dec/21: cash of $37.5m).
- FY22 production guidance will be provided later once the management estimates the scale of contribution from Vejnaly and Hasan (Gosha CA) on top of 54-58koz GE forecast at Gedabek.
- Commenting on strategic targets, the Company highlighted that near-term focus remains at increasing production at existing production facilities of Gedabek, Gosha and Vejnaly; longer-term, the team is aiming to add to its copper exposure with the new Garadagh and Demirli deposits as well as investment in Libero.
Conclusion: Annual results reflect weaker production on the back of lower processed grades as well as cost inflation leading to a fall in earnings. Despite a pressure on margins, Gedabek remained FCF positive with the Board proposing 3.5c dividend taking the proposed annual to 8.0c (~$9.2m or ~8% DY on current spot price) and marking the fourth consecutive year of dividend payments. Looking forward, the team highlights exciting development opportunities as the Company is expanding its copper exposure while intending to maintain its record of a reliable dividend payer.
The Company is clearly pivoting towards copper regarding its organic development pipeline with maiden Zafar mineral reserve expected later in the year ahead of the start of production in 2023. At the same time, the team is looking forward to the ratification of three new licenses (Garadagh, Xarxar and Demirli) by the Parliament that will pave the way for the start of exploration and development works at very prospective but mostly underexplored copper properties. The Company is well capitalised to deliver on exploration and development plans with ~$37m in the bank.
*SP Angel act as nomad and broker to Anglo Asian Mining
Atlantic Lithium Limited (AIM:ALL)* 47.4p, Mkt Cap £276m – US to support battery metals projects in sub-Saharan Africa
- The US administration wants to position itself as a strong supporter of battery metals projects in sub-Saharan Africa according to Veracity Worldwide, a New York-based political risk consultancy.
- The consultancy reckons that while Africa presents its challenges, those challenges are no more difficult than the corresponding set of challenges in Canada and it may be easier to actually bring a project to fruition in Africa, than in a place like Canada or the US.
- Last year, Atlantic Lithium signed a milestone agreement with Piedmont Lithium to fund and fast track development of the Ewoyaa Lithium Project for $102m.
- Split in three stages Piedmont subscribed for ~10% of new equity for US$16m, committed to earn up to 22.5% by spending U$5m on exploration and US$12m on DFS related costs with an option to earn in up to 50% on contributing US$70m for the development capex.
- Projects to mine metals key to the energy transition in Africa have seen their likelihood of funding increased following sanctions on resource-rich Russia (Reuters).
- Russia accounts for 7% of global nickel supply, 10% of the world's platinum, and 25-30% of the world's palladium.
- Companies and investors are considering projects they may have previously overlooked, while governments are also looking to Africa to supply battery metals.
- In March this year, Atlantic released an updated MRE which showed a 42% increase in total resource and ~300% in the Indicated category following the latest drilling programme.
- The new estimate of JORC (2012) compliant indicated and inferred resources, using a 0.5% Li2O cut-off, is 30.1mt at an average grade of 1.26% Li2O to a depth of -190m RL.
- This increase makes the project more attractive to offtakes and government agencies who recognise the need for scalability in such projects to make financing worthwhile.
*SP Angel acts as nomad to Atlantic Lithium
Base Resources Limited (AIM:BSE, ASX:BSE) 17.25p, Mkt cap A$365m – Analyst roundtable offers encouragement
- Base Resources ran an analyst roundtable yesterday to present the work being done at Kwale, Toliara and on other exploration.
- Management are working hard to extend the life of the Kwale ilmenite and rutile mine in Kenya and are looking at how to extend this mine to beyond 2024.
- The rise in ilmenite and rutile prices over the past year should make more of the resource economic with particularly low ‘hydraullic’ mining costs at this mine.
- The Kwale mine will need some new infrastructure and a new concentrator or could manage on a pre-concentrator while using the existing MSP plant.
- The Kenyan government is looking at building a new road in the area which may help to extend the mine line.
- Toliara: reports suggest the president is now approving new projects after some discussions with the IMF and the company’s advisors.
- The Toliara will use a similar concentrator to Kwale but with a smaller footprint due to taller spirals.
- The lower levels of slime at Toliara allows tailings to go straight back into the pit which is helpful.
- A simple jetty will be used for direct ship loading off the coast reducing trucking and disruption to the environment.
- Offtake discussions indicate strong demand and good potential to expand production at Toliara and could bring forward the DFS2 expansion.
- First production from Toliara could start in H1 2025.
- Management are also looking at an interesting Rutile opportunity on 3rd party licenses.
Cornish Metals Inc (AIM:CUSN, TSX-V:CUSN, OTC:SBWFF)* - 18.12p, Mkt cap £94m+ - Stringers of cassiterite mineralisation in granite host rock highlights lode structure
+( assumes issuance of 225m fundraising shares and 20m deferred consideration shares)
Valuation 48p/s
- Cornish Metals highlight core from 2020 drill program at the South Crofty tin mine showing tin mineralisation.
- Stringers of the tin-bearing mineral, cassiterite, permeate the granite host-rock to form structures suitable for mining.
- Similar structures are present in cores from the United Downes project, around seven miles from the main South Crofty mine.
- United downs also has the benefit of additional copper mineralisation which is thought to have been introduced as later stage mineralisation.
- While South Crofty reports a significant tonnages of mineralisation we also see potential for significant mineralisation at United Downes where ongoing drilling should confirm this hypothesis.
- Cornish Metals recently raised £40.5m through the placement of £25m of stock to Vision Blue Resources run by the former ceo of Xstrata and other institutional investment funds.
- South Crofty’s ‘Lower’ mine contains a NI 43-101 compliant ‘Indicated’ resources of over 2mt grading >1.59% plus an ‘inferred’ resource of 2mt grading 1.7% tin.
- Estimated economics:
- NPV5% of US$404m
- IRR of 35%
- Payback 1.7
- Assumes US$30,000/t long term tin price.
- Production 3,987tpa of tin in concentrate for the mining of 400,000tpa of ore upgraded to 240,000tpa grading 1.9% tin
- Life of mine 15 years.
- Operating cost of ~US$8,900/t over the life of the mine
- Tin prices have pulled back to $33,100/t this morning on concerns for global growth led by further lockdowns in China and the disruptive impact this may have on Chinese manufacturing.
*SP Angel acts as Nomad and Broker to Cornish Metals
Corcel PLC (LSE:CRCL) – 1.33p, Mkt cap £5.4m – Wowo Gap nickel/cobalt resources estimate
(Corcel, formerly Regency Mines was renamed on 7th August 2020)
- Corcel PLC (LSE:CRCL) reports a combined indicated and inferred mineral resources estimate of 110mt at an average grade of 0.81% nickel and 0.06% cobalt for its wholly owned Wowo Gap laterite deposit in Papua New Guinea.
- The estimate, which uses a 0.7% nickel cut-off grade, compares to a previous, 2011, estimate which showed 125mt at an average grade of 1.06% nickel and 0.07% cobalt using a higher, 0.8% nickel cut-off.
- The company says that the current estimate is lower, in part because it defines the margins of the deposit more closely than the earlier estimate, which used “a very wide margin (300 m) on the edge of the drilling area. This resulted in holes on the edge of the drilling having more influence than holes in the centre of the drilling. The 2022 model, in keeping with industry best practice, trims this margin to 150 m or roughly half the average hole spacing”.
- The Wowo deposit, which has no road access and hence requires air supported exploration, is described as “a result of deep weathering of ultramafic rocks of the Papuan Ultramafic Belt”.
- “The laterite profile (Figure 3) http://www.rns-pdf.londonstockexchange.com/rns/6895L_1-2022-5-16.pdf is typically 10m to 18m thick and composed of an upper iron-rich saprolite horizon (referred to as limonite) with high (>40%) to very high (>60%) Fe2O3 content but relatively low (<6%) MgO. It is the limonite horizon that contains enriched levels of cobalt, chromium and manganese values”.
Galileo Resources PLC (AIM:GLR) 1.08 pence, Mkt Cap £12.1 m – Progress at Luansobe, Zambia.
- Galileo Resources reports that it has located historic drill core, recovered during the 1950s and 60s from its Luansobe project area located approximately 15km northwest of, and along strike from, the Mufilira mine in Zambia.
- The core is reported to be “in remarkably good condition” and “Core from 21 priority holes has been located and is being re-logged, checked by pXRF for approximate copper content”.
- “58 cut core samples from two holes have been collected to date for laboratory assay to confirm the provisional XRF results and further sampling is planned”.
- Mineralisation at Luansobe “occurs over two contiguous zones, dipping at 20-30 degrees to the northeast, over a strike length of about 3km and to a vertical depth of at least 1,250m … [and Galileo Resources says that] … The top 30m from surface is reported to be leached, with oxide mineralisation occurring below this depth to about 70m below surface. Beyond this depth, copper generally occurs as sulphides. The deposit is reported to be open and relatively untested at depth. About 30% of the total contained copper occurs in acid soluble form (as copper oxide) - this is expected to be higher in the shallower parts of the deposit”.
- Colin Bird, Chairman and CEO of Galileo Resources said that “The fact that we can access this old core is extremely cost and time effective, reducing the amount of new drilling that will be required. The significance of this logging is that it will migrate into our short term open pit planning as well as our drilling programme for a larger resource at Luansobe. We continue to aim for definition of an open pit Resource by end Q3 2022, with the added advantage that the newly indicated mineralisation is relatively close to surface and can increase the resource tonnage”.
Conclusion: The discovery of historic drill core from Luansobe should help Galileo to deliver its planned mineral resource estimate by the end of Q3 this year. We look forward to the results.
Rambler Metals and Mining PLC (AIM:RMM, TSX-V:RAB)* 21.63p, Mkt Cap £34m – Guidance for 7,000t of copper production in 2022 confirmed as production grows and fixed price sales agreement for copper sales falls away.
NPV Valuation: 168p/s
- Rambler Metals & Mining’s results for 2021, which were released yesterday, show a loss of US$14.0m (2020 – US$1.8m loss) in a year which CEO, Toby Bradbury, described as challenging.
- However, he reported that the company had “made substantial progress on the turn-around we had planned for Rambler Metals and Mining”, with US$23.2m invested in mine development and equipment to position the operation to “start to deliver on the true potential of its quality ore reserves”.
- Revenues increased by approximately 16% to US$28.2m (2020 - US$24.3m) during a year in which “Rambler was committed to the sale of 3,600 tonnes of copper at a fixed price of US$7,700/tonne as part of the financing commitment made in 2020” and market prices of copper exceeded US$9,000/t.
- The completion of the sales commitment occurred in February 2022 leaving Rambler’s copper sales “fully exposed to the current buoyant copper price” and we are encouraged to learn that, even in 2021 when the company was unable to realise full market prices for its copper “Rambler's operations delivered a small positive cash operating margin”.
- The company confirms its previously announced 2022 guidance of 7,000t of saleable copper production based on a “Realistic production plan which has been built on the mine development and operational redundancy created in 2021 … [and the establishment of four] … mining areas established to deliver the required tonnage at an improving grade as we target the lower levels of the mine”.
- We observe that, with production of 1,066t of saleable copper during the first quarter of the year, achieving the projected 7,000t implies average production of 1,978t in each of the remaining 3 quarters of the year.
- Rambler Metals also confirms the continuation of its 17,000m programme of infill drilling which we anticipate will improve the assurance of the mine plan to deliver the required tonnage and grade profile on schedule.
- As the company continues to address the legacy issues of the Ming mine, it expects to revisit its plans for ore-sorting as the basis for an updated NI43-101 complaint operating base case as well as further studies on the optimisation of “tailings backfill; shaft hoisting; electrical power supply upgrade; mine digitisation - fibre optic communications … [and] … mill relocation studies”.
- Mr. Bradbury confirmed that Rambler Mines is looking “forward to completing the ramp up of the Ming Mine in 2022 to its design potential of 1,350 tonnes of ore mined and processed per day at a target grade of 2% copper. We have the development in place to support this level of production and we are increasingly improving our operational reliability and execution”.
- He also commented that the “Newgen debt facility of $16.3 million” and Newgen’s equity investment was the “most significant” of 2021’s US$32.2m financing initiatives which resulted in a total of US$19.4m of additional funding, “including $19.4 million from issuance of shares and warrant exercises (net of transaction costs), $3.0 million from sale of non-core assets and equity investments and $9.8 million from net borrowing”.
Conclusion: The completion of its fixed price sales commitments in February this year leaves Rambler fully exposed to current strong copper prices as its production increases with four producing areas at the Ming mine.
*SP Angel act as Nomad and Broker to Rambler Metals & Mining)
Tertiary Minerals PLC (AIM:TYM)* – 0.22p, Mkt cap £3.2m – Initial drilling results from the Jacks copper project, Zambia
- Tertiary Minerals has announced preliminary results from the first hole, 22-JKDD-01 at its Jacks copper project in Zambia where the company has an option to earn a 90% interest in the licence held by its local partner, Mwasha Resources.
- The company says that visual identification of the copper minerals chrysocolla and malachite in the drill core “has been confirmed by portable XRF measurements at site”.
- Mineralised intervals “will be sent to the SGS laboratory in Kalalushi for analysis”.
- The mineralisation occurs “as veins and in fractures and as disseminations over several metres around 90 metres downhole depth (corresponding to a depth of approximately 74 metres below surface)”.
- The drilling is following up a “16 kilometre … [long] … open-ended soil geochemical anomaly at Jacks with historic drill logs reporting intersections as wide as 23.95 metres grading at 1.26% total copper (TCu), including intervals as high as 3.19% TCu over 2.15 metres”.
- Managing Director, Patrick Cullen, explained that “At this early stage, the drilling is focused on demonstrating mineralisation at grades and depths that are practical for open pit operations. It is apparent from historic work that there is significant structural complexity at Jacks. We are collecting core orientation data which we expect will provide improved understanding of the structural geometry and controls on mineralisation and help guide our exploration programme going forward”
- He said that “We believe that Jacks has the potential to host potential economic mineralisation and we look forward to reporting laboratory results and further updates going ahead.”
- The current drilling campaign is expected to consist of 750-1,000m of core-drilling.
Conclusion: Early results from the first hole at the Jacks project in Zambia show copper mineralisation at 74m below surface. Confirmation of the grade of the mineralisation will need assay confirmation and its extent and geological complexity remains to be determined by further drilling but, with an increasing interest in copper exploration in Zambia in our opinion, a 16km long geochemical anomaly represents a target of merit and we await results of the continuing work with interest.
*SP Angel act as Nomad and Broker to Tertiary Minerals
Zamare* (Private) 300p/s, valuation £7.6m – Zamare acquires Kamoa-style copper exploration licence in NW Zambia
- Zamare Minerals reports the acquisition of a significant new license area in the north-west of Zambia.
- The region covers the south-western continuation of ‘Western Foreland’ style rocks which host the massive Kamoa-Kakula copper mine in the DRC.
- Kamoa-Kakula hosts the world’s fourth largest and highest-grade copper resource with a NI 43-101 resource of 1,387mt grading 2.74% copper.
- Ivanhoe forecast the mine to see production of 600,000tpa end 2024 making this the world’s third largest copper mine ranking just behind Collahuasi and Escondida.
- Anglo American agreed to spend US88.5m with Arc Minerals last week on by way of an earn in agreement with including a cash consideration of up to $14.5m which will help Arc to contribute to their share of the exploration.
- The discovery at Kamoa has led to the identification of a new mineral province with potential for multiple copper discoveries to the west of Solweizi in Zambia.
- The region already hosts First Quantum’s Sentinel copper/nickel mining complex
- The ‘Western Foreland’ is defined as the contact between ancient basement and younger Katangan aged rocks with copper found at Kamoa in the younger Katangan aged rocks.
- The dramatic discovery at Kamoa has caused a rethink of Copperbelt exploration along the Kansoko Trend which runs south-west from Kamoa into the West of Zambia
- Zamare is also working on five, 100% owned, Licences in Zambia totalling 1,121 km2:
- Murundi: ground is adjacent to the giant Mufulira underground Copper mine in the Copperbelt, Rio Tinto are funding 100% of the work program at Murundi which lies adjacent to an existing Rio Tinto held license and work program
- Ntambu: close to and along trend from First Quantum’s Enterprise nickel and Sentinel copper mines. Zamare has a Technical Cooperation Agreement with First Quantum Minerals (TSX:FQM) who have been hugely helpful in their assistance,
- Dongwe: consisting of three licences in an area with current artisanal mining. Zamare assayed 15.8% copper and 0.57% gold from an artisanal pit at Dongwe in late 2020. Moxico are exploring a block adjacent to Zamare in the Dongwe area
Conclusion: Zamare is operating relatively early stage exploration programs on a number of prospective licenses.
The current round of exploration should work up a number of targets for drilling potentially later this year.
*SP Angel acts as broker to Zamare
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 – – 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
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*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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