Arc Minerals (LSE:ARCM) rose 1.9pc to 2.6p on Monday morning after announcing that it has completed the construction of a demonstration pilot plant at one of its copper/cobalt licences in Zambia. The business said the plant was completed under budget at its part-owned Kalaba prospect and has been successfully commissioned with the initial production of copper/cobalt sulphide concentrate.

Kalaba is a copper-cobalt licence covering nine of 30 high priority targets ranked by a previous JV operated by Anglo American. It is found near First Quantum’s Sentinel and Kansanshi and Barrick’s Lumwana mines. The project has an existing near-surface estimated copper-cobalt oxide resource of 16.59Mt at 0.94pc copper and a historical exploration target of 150Mt. This makes it one of the most significant projects of its type in Zambia.

Kalaba is owned by a private company called Zamsort, which is in turn 66pc owned by Arc. Alongside this equity position, Arc has issued a convertible loan to Zamsort that converts into an additional c.5pc stake.

Arc is now finalising detailed oxide resource tonnages, grades, and mining line with the completion of the block modelling of Kalaba’s overall oxide resource. The block model assessment of the ore body will be the basis for a review of operational and mining strategy at the site. This will include the cost-benefit potential of upgrading the oxide ore feed into the plant aimed at materially reducing consumption of acid and related input costs.

Arc said that initial production at its demonstration plant would incur no mining costs because feed will be drawn down from an existing stockpile of 10,000ts at 2pc copper. Finally, the organisation said it is also looking at the potential of using the plant to enhance revenue streams through the production of separate copper and cobalt sulphide precipitates.

Arc’s executive chairman Nick von Schirnding said: ‘I am very pleased to report that we delivered on our commitment to complete the construction and commissioning of the small-scale demonstration pilot plant at Kalaba. We have now completed the plant under budget - for less than half a million dollars.  It is also an important step regarding Zamsort's previous commitments in terms of its exploration licenses. In the meantime, we have made major progress regarding our next phase of exploration and our newly identified targets. A more detailed update on this will be made shortly.’

In February, Arc announced that it had identified two ‘potentially game-changing’ new targets on Zamsort’s acreage in Zambia. The business released the initial results of an airborne geophysical and soil sampling programme at the copper-cobalt licence owned by Zamsort.

The work revealed seven new anomalies, the largest of which are Cheyeza West and Lumbeta. Cheyeza West contains a 3km-by-3km anomaly outlined by very high copper values in the soils enclosed by the wider 10km-by-8km Cheyeza anomaly. Furthermore, a co-incident electromagnetic anomaly over the core has indicated conductivity within the host rock.

Meanwhile, the Lumbeta target stretches for 11km and is associated with the crest of a fold. According to Arc, these formations can act as mineralisation traps and form high-grade deposits

Arc expects to release a more detailed update ‘shortly’ once it has assessed the results of the programme thoroughly with its external exploration consultants.

Von Schirnding said Cheyeza West and Lumbeta are close to ten times the size of Kalaba.

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

The Author has not been paid to produce this piece by the company or companies mentioned above.

Catalyst Information Services Ltd, the owner of MiningMaven.com, has not been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and Catalyst Information Services Ltd are not responsible for its content or accuracy and do not share the views of the author. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

Canadian cobalt developer Global Energy Metals (TSX-V:GEMC) has launched a private fundraise to support a phase one exploration programme at its two projects near Tesla’s Gigafactory in Nevada.

The firm, which announced plans to co-list in London earlier this year, said on Thursday that it had arranged a non-brokered, private placement with strategic investors for gross proceeds of up to $500,000. It will issue a maximum of 10m units comprising one $0.05 share and one three-year warrant exercisable at $0.10. Elsewhere, the business said it had also approved the settlement of up to $181,50 of debt by issuing shares at $0.05 each to certain creditors.

Global Energy said its placing proceeds will be used to advance its Lovelock and Treasure Box projects ‘immediately’. The two properties are located in Churchill County, around 150km east of the Tesla Gigafactory in Sparks, Nevada. Lovelock covers around 1,400 acres and is said to have produced 500ts of cobalt and nickel mineralisation between 1883 and 1890 when it was last in operation. Global Energy believes exploration work and modern drilling techniques could unlock a large amount of potential value at the site.

Treasure Box, meanwhile, is adjacent to Lovelock and hosts mine workings from limited copper production, which occurred until early into the 20th century. A historical diamond drill hole at the asset reportedly intersected 1.52pc copper over 85ft, with mineralisation beginning at surface.

Nevada progress

Last month, Global Energy announced that it had made its first option payment towards acquiring an 85pc stake in both Lovelock and Treasure Box. It issued 384,627 of its shares to the projects’ current owner Nevada Sunrise and paid $20,000 to the underlying vendor.

Speaking to MiningMaven in February, Global Energy’s chief executive Mitchell Smith said the acquisition gives the business a low-cost entry to an exciting jurisdiction close to the world’s largest battery factory:

‘Some of the grades at these sites are exceptional. Historically, grades were reported as high as 14-15pc cobalt, which is just unheard of. It shows there is a real opportunity in this significant land package covering two past producing mines. Given our proximity to Tesla, this could really provide us with unique access to the growing demand for domestic cobalt supply in the US.’

In its March update, Global Energy also said it is reviewing exploration plans for Lovelock and Treasure Box. It said its first-stage exploration programme would assist it with an ongoing, extensive review and reinterpretation of historical data at both sites.

‘There has been a tremendous amount of attention placed on the US for it to stop being merely a bystander in the global battery arms race and start developing more domestic supplies of battery metals such as cobalt, nickel and copper to supply its homegrown battery factories, including Nevada-based Gigafactory 1,’ said Smith. ‘The Lovelock and Treasure Box projects are prime examples of US-based battery metal projects that are very prospective and strategically located in close proximity to a domestic end-user with a large appetite for the critical materials used in EV and energy storage technology.’

Global Energy focuses on offering security of supply of cobalt, which is a critical material in the rapidly growing rechargeable battery market. It is building a diversified global portfolio of assets in the sector, including project stakes, projects and other supply sources.

The business’s flagship asset is the Millennium Project in the world-renowned Mt. Isa region of Queensland, Australia. It executed the final agreements to take a 100pc interest in the project in November.

Millennium is a multi-zone, near-surface cobalt-copper sulphide system with several kilometres of potential strike length. It is located near established mining, transport, and processing infrastructure and offers easy access to a very skilled workforce.

The growth-stage site contains a defined zone of cobalt-copper mineralisation. Here, a 2016 JORC Resource estimate identified 3.1MMts of inferred resources containing 0.14pc cobalt and 0.34pc copper with gold credits.

Global Energy is now looking at ways to increase the size of its deposit. Results from a first phase exploration campaign at two zones called Millennium North and Millennium South exceeded grade and thickness expectations. The firm will now carry out a second phase of drilling to examine both areas further.

Alongside Millennium, Global Energy has acquired two further discovery sites called Mt. Dorothy and Cobalt Ridge. These are collectively known as the ‘Mt. Isa projects’. The areas expand Global Energy’s Australian land position by nearly twenty times but have yet to be exploited. Exploration to date has returned high-grade cobalt intercepts at both, allowing Global Energy to line up numerous targets for further investigation and test work to define a resource.

Finally, the business currently owns 70pc of the Werner Lake cobalt mine in Ontario Canada. It joint venture partner Marquee Resources is enjoying much success in its ongoing exploration campaign at the asset.

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

Catalyst Information Services Ltd, the owner of MiningMaven.com, owns a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

Catalyst Information Services Ltd, the owner of MiningMaven.com, has been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and Catalyst Information Services Ltd are not responsible for its content or accuracy and do not share the views of the author. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

African Battery Metals (LSE:ABM) has been on something of a roller coaster ride over the last few months. After its shares were suspended at the end of 2018, in the face of financial uncertainty, a successful refinancing programme allowed the company to return to trading in February with no debt and a healthy cash runway. Alongside this newfound financial security, the organisation has also undergone a significant management restructuring that has seen industry veterans Paul Johnson and Andrew Bell both become executive directors.

As it stands, African Battery’s shares sit at 0.4p to give the business a modest valuation of just £1.33m. In this two-part interview, Johnson talks us through Bell and his plans to build on this base by using the firm’s strong core offering to create value for both new and existing shareholders.

New beginnings

African Battery’s significant transition began in December last year with the suspension of its shares pending clarification of its financial position. In an accompanying statement, the company revealed that it had been unable to secure equity finance with its largest shareholders despite ‘protracted discussions’.

Following this considerable setback, the firm took a significant step forward at the end of January when it revealed a restructuring and refinancing package. This was centred around a £1m fundraise at 0.5p per share with two-year warrants attached. This would enable it to pay off all of its material creditors, leaving it debt free with a cash runway of at least 12 months. 

Critically, the arrangement also proposed that African Battery’s then-CEO Roger Murphy and executive director Matt Wood would step down from the firm’s board. Meanwhile, well-known AIM figures Andrew Bell and Paul Johnson would both join as executive directors and take part in the placing. Johnson is an experienced public company director who has previously served as chief executive of Metal Tiger, Metal NRG, and China Africa Resources. He has also been chairman of ECR Minerals and non-executive director of Greatland Gold, Papua Mining, and Thor Mining. Bell, meanwhile, has worked in the natural resources sector since the 1970s and is perhaps most recognised as chairman of Red Rock Resources and non-executive director of Jupiter Mines.

Johnson tells us that he and Bell’s engagement with African Battery arose from their long-standing interest in its operations. As a result of this awareness, the pair were keen to look at ways of fixing the firm’s financial situation as soon as they heard of its suspension:

‘African Battery has always had a healthy amount of interesting news flow,’ Johnson tells us. ‘When it announced that it had suspended, it seemed obvious to us to look into what problems existed and whether they were fixable. These days, AIM operating companies with some cash, no debt, and some potential forward momentum in operations can be highly valuable. We pretty quickly concluded that we could resolve the company’s issues, and felt that this represented a great opportunity.’

Johnson says he also feels that current market conditions represent an opportune moment to get exposure to battery metals. Indeed, once obscure materials like copper, cobalt, nickel, lithium, and manganese are now being hailed as the ‘new precious metals’ due to their use in the next generation of batteries. These have many applications, but their most notable us is arguably in electric vehicles (EVs).

Alongside supply-side limitations, many expect the anticipated, global shift towards EVs over coming years to lead to an explosion in the price of elements associated with their construction. For example, the market for cobalt alone is expected to double over the next four years and quadruple by 2028 due to an unsteady supply pipeline for the metal and its use in around three-quarters of EV batteries.

‘You just have to look at all the facts about battery metals like forward supply/demand dynamics and underlying factors that would drive demand to see an opportunity,’ Johnson explains. ‘There has not been growth in mining, exploration, project development, and new mines for these metals, and that is affecting supply. Meanwhile, as everyone knows, battery metal demand is increasing dramatically and is expected to continue rising.

This is really an unusual situation. We have actually got supply and demand factors that could hit prices positively at the same time. For example, do I think copper is going to stay at its current, depressed price forever? I doubt it. Likewise, nickel looks to be on a significant, overall, rising trend. I think we are set for an excellent growth period and this is the perfect place for us to be.’

Operational review

Several weeks after the refinancing was announced, Johnson and Bell’s proposals were passed by shareholders, prompting the pair’s appointment and the restoration of trading in African Battery’s shares. Since joining, the two executive directors have been busy completing a thorough strategic and operational review of the business.

On the financial side, this has seen them cut corporate costs to minimal levels and amend boardroom pay to ensure directors’ salaries are transparent and reflect both performance and African Battery’s cash position. Elsewhere, in early March, the business announced that it has now paid all material creditor balances through cash or share settlement. As such, it no longer has ‘material debt’ and substantial working capital.

Meanwhile, on the operational side, the pair are also conducting a review of each of African Battery’s existing project interests. To date, the company has committed to proceeding its 70pc-owned and operated Kisinka copper-cobalt project in the Democratic Republic of Congo (DRC). This decision followed a visit by Bell in February, which included meeting with project vendors and local technical advisers.

The company is now liaising with its geological team to prepare a next-stage exploration programme for Kisinka. This will be optimised using previous exploration data, and modifications have been made to earlier plans to maximise cost efficiency. Meanwhile, the organisation has now made all outstanding project payments to Kisinka’s vendor and completed all the changes required to comply with the DRC’s new Mining Act.

After reviewing historical data, African Battery has also committed to continuing its work in Cameroon. Through its subsidiary Cobalt Blue Holdings, the company holds four nickel cobalt licences in the country either adjacent to or within 50km of the Nkamouna/Mada project. This is the most significant undeveloped cobalt resource outside the DRC and has a NI 43-101 compliant resource of 323Mt at average grades of 0.21pc cobalt, 0.61pc nickel, and 1.25pc manganese. Cobalt Blue also holds two licence applications at Ntam Est and N'Gaoundere.

African Battery is now devising a forward work programme for Cobalt Blue’s assets that will prioritise the highest-profile targets as determined from work undertaken and reviewed to date. In an announcement, Johnson said the business would like to begin its work as soon as possible so it complete before heavy rains expected after June.

Bell and Johnson are now completing a review of African Battery’s final interest in Côte d’Ivoire. Through its subsidiary Regent Resources Interests, the business can earn into 70pc of the Lizetta II chrome, nickel, cobalt exploration licence in the country. An independent assessment of the project, which is based near the country’s commercial capital, has confirmed its potential to host cobalt, nickel, and chrome mineralisation of economic potential. It has also proposed an initial field programme consisting of historical data compilation, geological mapping, geophysical surveys, trenching, and RC drilling.

Johnson tells us that he and Bell are using a three-stage process to review African Battery’s existing portfolio:

‘The first stage of this process is to look at each project and its potential. Here, we want to work out if the asset can, on its own basis, engage the market, create value, and be a decent addition to African Battery’s portfolio. Then, if we do decide to proceed with a project, we will announce this to the market,’ he says. ‘Following this, the second stage is to review how best to take the project forward. We look at where we can spend the money in a way that creates the most value for shareholders. This could be on something like an exploration programme or a development programme. Once we have worked out the best approach possible, we will then announce this to the market. Finally, the third stage is to get on with the planned work and start taking the project forward.

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

The article expresses the views of the Author solely and does not necessarily express the views of MiningMaven.com and Catalyst Information Services Ltd or their connected parties who are not responsible for its content or accuracy

News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance. Readers are recommended to seek the advice of appropriate professionals when considering investments in small capital.

Last month saw leading car maker BMW reveal plans to stop buying cobalt for its electric vehicles (EVs) from the Democratic Republic of Congo (DRC) in 2020/21. As it stands, the DRC provides around 60pc of the world’s cobalt supply, meaning the critical battery metal’s price is influenced heavily by the geopolitically unstable nation’s ongoing turmoil. With this in mind, could the promise of additional vehicle manufacturers following in BMW’s footsteps favour cobalt miners operating in more stable jurisdictions?

Changing plans

As reported by electrive.com, BMW board member Andreas Wendt announced the company’s plans to halt cobalt purchases from the DRC in an interview towards the end of March. He said the firm made its decision because cobalt demand has already decreased somewhat due to technical developments. It expects this dynamic to continue.

What’s more, Wendt added that there remains ‘enough [cobalt] deposits that have not yet been explored’. As such, the organisation expects to replace its Congo cobalt supply with materials and resources from other jurisdictions around the world.

The decision comes several months after BMW announced a collaboration with chemicals giant BASF, battery maker Samsung SDI, and development agency GIZ to improve cobalt mining working conditions in the DRC. The firms said that they were exploring ways to improve working and living conditions in areas where cobalt is extracted using manual labour.

Companies with operations in the DRC are currently facing challenges in the areas of environment, health and safety, and human rights when cobalt is extracted through artisanal mining. This dangerous practice makes up around 15-20pc of Congolese cobalt production. There are also concerns around the use of child labour in the nation, while the cost of doing business has also increased thanks to a recent mining code change that saw royalty costs shoot up to 10pc.

Market fluctuation

Cobalt prices have staged a massive rally in recent years due to an anticipated increase in the use of EVs around the world. Given that around three-quarters of electric vehicle batteries currently contain cobalt, the market for the metal is expected to double over the next four years alone and quadruple by 2028.  To express this another way, 62pc of global cobalt demand is likely to come from battery manufacturers by 2020, up from 51pc in 2016 and 20pc in 2006.

Despite the continuation of this long-term trend, prices of the metal have slumped recently. Indeed, they have fallen from $25/lb to $13.61/lb in the first three months of 2019 alone. This has been driven by numerous factors, including a slightly slower-than-expected uptake of EVs, a rush to mine as much cobalt as possible, and a change in subsidies in China - responsible for half of global EV sales.

However, the price has arguably been most depressed by a large amount of new supply coming online from the DRC. The cobalt market’s current reliance on the country became clear in November when prices soared after Glencore abruptly halted sales of the metal from the country after discovering uranium at its key mine.

If more carmakers were to follow BMW in cutting off their ties to DRC’s cobalt market, then it raises the question of where supply is going to come from – especially if EV demand explodes as predicted. Indeed, there are still very few companies operating as a pure play on the metal.  As it stands, 98pc of the world’s cobalt arises as a by-product of mining for other metals.

Aside from the price increases associated with supply threats, this dynamic would make the cobalt assets held by junior miners outside of the DRC look more attractive to both buyers of the metal and larger miners. In this situation, many firms could stand to benefit.

Key players

One example is Global Energy Metals (TSX-V:GEMC), which is currently preparing to build upon its strong UK shareholder base by co-listing in London. The firm is developing a diversified global portfolio of cobalt assets, including project stakes, projects and other supply sources.

The business’s flagship asset is the Millennium Project in the world-renowned Mt. Isa region of Queensland, Australia, where it executed the final agreements to take a 100pc interest last November. It is also in the process of acquiring an 80pc stake in two Nevada-based cobalt sites called the Lovelock Cobalt Mine and the Treasure Box Project. These are located just 150km east of Tesla’s Gigafactory. Finally, the business currently owns 70pc of the Werner Lake cobalt mine in Ontario Canada.

Also building a foothold in the cobalt space within the Canadian market is Forum Energy Metals (CVE:FMC). Although the firm’s most prominent focus is on the uranium and copper markets, it has entered Idaho’s cobalt belt with the acquisition of the Quartz Gulch exploration property. Its goal is to discover near surface mineral deposits by both exploring its 100pc-owned properties and developing strategic partnerships and joint ventures.

Another example is Kavango Resources (LSE:KAV), which listed in London last July. The business focuses on locating magmatic, massive sulphide orebodies in Botswana, with a particular focus on a 450km-long magnetic anomaly called the Kalahari Suture Zone (KSZ).

Last month, Kavango revealed that the first hole drilled at its Ditau prospect in the KSZ had encountered a 200m zone of intensely altered rock holding a 70m area containing significant sulphide alteration. This presented indicative cobalt values of up to 0.9pc and a weighted average of 0.2pc cobalt alongside elevated copper, zinc, lead, and nickel values. The company called the result ‘extremely encouraging’ and ‘suggestive of mineralisation at depth’.

Another firm looking to increase its battery metal exposure is African Battery Metals (LSE:ABM), which recently returned to trading with a refinanced balance and new management team after a period of difficulty. The firm, which is now led by industry veterans Paul Johnson and Andrew Bell, owns cobalt-prospective in the Cameroon and Côte d’Ivoire as well as the DRC. It is also on the hunt for new opportunities as it looks to take advantage of today’s poor funding climate for vendors.

Other outfits with exposure to cobalt include Phoenix Global Mining (LSE:PGM), which holds two prospective cobalt properties in Idaho, and Horizonte Minerals (LSE:HZM), which owns Vermelho nickel-cobalt project. Names such as Greatland Gold (LSE:GGP), IronRidge Resources (LSE:IRR), Keras Resources (LSE:KRS), and Mkango Resources (LSE:MKA) also have exposure to the metal in their portfolio.

The tactic of using battery metals to get exposure to the ‘EV boom’ is likely familiar to investors by now, given the unavoidable hype that has surrounded the sector for some time. However, if BMW’s decision to ditch the DRC catches on it could provide an exciting, fresh twist to the narrative that may work in favour of many of the businesses mentioned above.

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

The Author has not been paid to produce this piece by some of the companies mentioned above.

Catalyst Information Services Ltd, the owner of MiningMaven.com, owns a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

Catalyst Information Services Ltd, the owner of MiningMaven.com, has been paid for the production of this piece by some of the companies mentioned above.

MiningMaven.com and Catalyst Information Services Ltd are not responsible for its content or accuracy. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance.

On Monday, Emmerson PLC (LSE:EML) revealed a metallurgical test work programme was underway at its Khemisset Potash Project in Morocco. The programme will be carried out by the Saskatoon Research Council (SRC) under the supervision of one of the world’s leading potash experts, Don Larmour. After reviewing the existing Scoping Study, Larmour was able to highlight opportunities to optimise the project’s design. As a result, the company has managed to significantly reduce the projected capital expenditure and operating costs for Khemisset. The $7.5m saving identified by Larmour is achievable by utilizing storage and loading facilities at the Port of Casablanca.

The scoping study for Khemisset confirmed that it has the potential to be among the lowest capital cost, highest margin potash projects in the world. Now Emmerson, in consultation with Larmour, is preparing a full Feasibility Study for the project.

The project has a large JORC Resource Estimate of 311.4Mt @ 10.2% K2O with significant exploration potential to extend the resource. The Scoping Study completed in November 2018 suggested a post-tax Net Present Value (NPV10) of US$795 million for the project with an Investment Rate of Return (IRR) of 29.8pc.

Khemisset is ideally located in Morocco with a strong growing local market in addition to good access to Europe, Brazil, and the vast potential of the African continent.

MiningMaven recently spoke about the project with Hayden Locke, Chief Executive Officer of Emmerson, in our 100th episode of the MiningMaven podcast.

Locke, commenting on today’s announcement, said:

"The commencement of metallurgical testing is another important de-risking step towards our goal of becoming a highly profitable potash producer. The results of the Programme will be used to confirm, adjust and optimise the process flow sheet in the upcoming Feasibility Study.

"The results of the Met Testing will also form a key part the technical due diligence any debt or financial partners will perform when assessing the financeability of the Project.

"Don and SRC have an extensive history working together and we expect that the programme will be completed to a very high standard which will be beneficial to the long-term future of the Project.

 "We look forward to continuing to deliver on our many development objectives and timelines during this transformational year for the Company as we advance the world-class Khemisset Project towards production."

Author: Stuart Langelaan

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

The Author has not been paid to produce this piece by the company or companies mentioned above

Catalyst Information Services Ltd, the owner of MiningMaven.com, has not been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and Catalyst Information Services Ltd are not responsible for its content or accuracy and do not share the views of the author.  News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

Thor Mining (LSE:THR) was trading at 0.8p on Wednesday after announcing plans to expand its operational portfolio through two acquisitions.

The business said is looking to acquire Pilbara Goldfields and Hammersley Metals, which collectively hold interests in two granted licences and seven licence applications at various stages of advancement. These assets are prospective for gold and uranium and cover a total of 764km2 in the Pilbara region of Western Australia and the Northern Territory of Australia.

To purchase the companies, Thor will pay £450,500 through the issue of 53m new shares at 0.85p each. These are subject to a six-month lock-in. Furthermore, following shareholder approval, the vendors will receive 26.5m Thor warrants to subscribe for 26.5m of the company’s shares at 1.3p each. These will have a three-year lifespan. Finally, the vendors will receive an additional 22.5m Thor shares if any of their projects enter commercial production.

To support the development, Thor has undertaking strategic financing raising £400,000 by issuing more than 47m new shares at 0.85p each. These shares are accompanied by three-year warrants exercisable at 1.3p. ‘With existing cash at bank, the strategic financing provides a valuable addition to Thor’s working capital,’ the firm added.

Thor will now conduct further work on both Pilbara and Hammersley’s licence application interests before reporting back to the market over the coming weeks.

In Wednesday’s update, Thor said it pursued the deal because much of its portfolio is beginning to reach the crystallisation stage. Indeed, the business has advanced its 100pc-owned Molyhil tungsten and molybdenum project to mine construction-ready status. It is currently in a commercialisation process to secure project-level finance for the mine construction phase. Meanwhile, the company’s Kapunda project interest (up to 45pc) is being divested into a new company called Enviro Copper, as announced earlier this month.

Once these two transactions have completed, Thor said its exploration interests will be limited to its 40pc-owned Bonya tungsten, copper, and vanadium project. As such, executive chairman Mick Billing said the new firms will give it access to a new round of exploration opportunities in Australia.

‘I am extremely pleased to announce today's Strategic Australian acquisitions which add gold and uranium into the Thor Mining Australian portfolio,’ he added. ‘The company is seeing the maturity of its Molyhil project as we move toward the mine construction and production phases. Likewise, with Kapunda as announced the company is moving its interest into a new vehicle with a listing strategy on a recognised stock exchange.

‘In anticipation of the above crystallisation process the Company needs to access new Australian opportunities and the Strategic Acquisitions announced today enable us to take a material step forward in this regard. Alongside this the Strategic Financing further bolsters our working capital and provides a considerable extension to our cash runway. Thor is active in multiple areas and we anticipate further news updates to the market in the near-term. I look forward to updating the market across the above areas over the coming weeks.’

Elsewhere, Thor announced that it is currently undertaking standard director due diligence before appointing a new external non-executive director. This individual will assist the firm with its transition and development.

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

The Author has not been paid to produce this piece by the company or companies mentioned above.

Catalyst Information Services Ltd, the owner of MiningMaven.com, owns a position in the stock(s) and/or financial instrument(s) mentioned in the piece.

Catalyst Information Services Ltd, the owner of MiningMaven.com, has not been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and Catalyst Information Services Ltd are not responsible for its content or accuracy. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance.

 

Ecuador-focused resources firm SolGold (LSE:SOLG) dipped 3.7pc to 38.7p on Tuesday despite revealing progress at its flagship Cascabel project and developments in its bid for Cornerstone Capital Resources.

SolGold said the preliminary economic analysis for Cascabel’s Alpala deposit is now at a ‘very advanced stage’ and is slated for release following peer review and quality assurance procedures. However, the firm noted that preliminary mine plan assessments and metallurgical data have been more complicated than initially anticipated, resulting in ‘unavoidable but necessary’ delays.

Alpala lies upon the northern section of the prolific Andean Copper Belt, the base for nearly half of the world’s copper production. According to SolGold, the project area hosts mineralisation of Eocene age, which is the same age as numerous Tier 1 deposits along the belt in Chile and Peru.

Elsewhere, the business said it is continuing to engage 11 drilling rigs onsite across the wider Cascabel area in Northern Ecuador. These are carrying out resource extension drilling at a rate of 10,000m a month, focusing on higher-grade mineralisation to the North West and South East of Alpala. Furthermore, the company is conduction sterilisation and geotechnical drilling of the proposed plant site and decline route.

Finally, SolGold provided an update on its bid for TSV-listed Cornerstone Capital Resources, first announced in January this year.

Cornerstone owns the final 15pc of Cascabel that is not owned by SolGold. The latter believes that moving the operation into one entity will have ‘tremendous economic upside, further de-risk the ownership structure and present a simplified and highly attractive value proposition for investors’. The business has offered Cornerstone’s shareholders the opportunity to convert each of their shares into 0.55p of a SolGold share, which it has calculated as an immediate premium of around 20pc.

In Tuesday’s update, SolGold said it is finalising formal documentation for its Cornerstone bid, which it expects to complete shortly. The business said the process had taken longer than expected due to ‘taxation and other considerations to ensure the most advantageous treatment of Cornerstone shareholder’ and the need to translate the bid into French. However, it added that the withdrawal or failure of its bid could have a negative or depressing effect on the illiquid cornerstone market.

‘Should the bid be successful, all Cornerstone shareholders will benefit greatly from consolidation of the project to increase focus and attention on the SolGold capital structure,’ SolGold went on to add. ‘SolGold's award-winning management team are applying the exploration expertise, regional familiarity and blueprint throughout the country, based on the Company's extensive exploration portfolio secured pursuant to its 2014 first mover advantage in Ecuador as a serious copper-gold porphyry explorer.’

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

The Author has not been paid to produce this piece by the company or companies mentioned above

Catalyst Information Services Ltd, the owner of MiningMaven.com, has not been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and Catalyst Information Services Ltd are not responsible for its content or accuracy and do not share the views of the author.  News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

Asiamet Resources (LSE:ARS) rose 4.3pc to 6.9p on Monday morning after continuing its hot news streak with the upgrade of its Beutong copper-gold resource in Indonesia.

The firm revealed a 2019 mineral resource assigning the asset a measured resource of 34Mt at 0.67pc copper, 0.13g/t gold, 1.68g/t silver, and 90ppm molybdenum. Meanwhile, its indicated resource has been set at 56Mt at 0.58pc copper, 0.12g/t gold, 2.07g/t silver, and 104ppm molybdenum.

Finally, Beutong’s inferred resource now hits 419Mt at 0.45pc copper, 0.13g/t gold, 1.14g/t silver, and 125ppm molybdenum. All-in-all, this translates to total resources of 2.43Mt copper, 2.11Moz gold, and 20.9Moz silver.

Beutong is a sizeable high-quality copper, gold, silver, molybdenum deposit outcropping at surface that boasts production licence tenure and is based near existing infrastructure. The upgrade follows an infill drilling programme completed last year that improved Asiamet’s geological understanding of the asset.

What’s more, the prospect appears to offer plenty of upside potential, remaining open to the east, west, and at depth. Indeed, the deepest drilling completed at Beutong to date has intersected porphyry mineralisation to around 800m below surface and 200-300m below the depth of drilling used to delineate its resource.

Alongside this, Asiamet has modelled strong copper, gold, and molybdenum grades near a sizeable magnetic body below current drilling. It believes this offers ‘excellent potential’ for the discovery of a high-grade ore similar to well-known porphyry systems like Wafi Golpu and Cascabel, owned by Newcrest and Solgold respectively.

Asiamet is now planning to complete further drilling campaign to grow the Beutong deposit well beyond the current resource, test the potential for a high-grade core, and explore early stage development opportunities.

The company’s chief executive Peter Bird, added: ‘Junior companies with large, well located development stage copper inventories such as Asiamet are rare and extremely well positioned to benefit from widely forecast stronger copper prices. 

‘The 2018 drilling program has improved our geological understanding of the deposit and this updated Mineral Resource Estimate in accordance with JORC 2012 provides strong support for the integrity, size, scale and upside potential of the project.  Future drilling campaigns will be directed to expanding the Resource, testing the potential for a high grade core at depth, and exploring early stage development options for the project.’

The upgrade at Beutong comes just days after Asiamet revealed that strong drilling results have taken it another step closer to completing a bankable feasibility study (BFS) for its BKM copper deposit in Indonesia. The business said that the latest round of assay results received from infill and geotechnical drilling have confirmed its expectations for the deposit. It added that they also ‘further strengthen’ resource models at the site.

Highlights from the latest results include a hole called BKM31550-06 that delivered 19m at 1.16pc copper from a depth of 72.5m. This included 5m at 1.43pc copper from 82.5m depth and 2m at 2.61pc copper from 89.5m depth. Another hole called BKM31550-09 included 27m at 0.67pc copper from 57.5m depth. This featured 3m at 2.15pc copper from 80.5m depth.

Asiamet has now completed 37 resource evaluation holes and four geotechnical holes for 5,665m of diamond core drilling. It has received assays results for 32 holes, with the remaining nine expected before the end of the month. Once the company gets these, it will update its resource models at BKM, using this to generate first ore reserves for the BKM copper project.

The BKM BFS is expected to precede the delivery of a final feasibility study by the close of H1 2019 and first production by the end of the year. Asiamet has already carried out a preliminary economic assessment at BKM, which gave the site an after-tax NPV10 of $204m and after-tax IRR of 39pc. This calculation was based around a 25ktpa copper cathode heap leach operation to be carried out over an initial eight years.

BKM’s NPV alone dwarfs Asiamet’s current £66.2m (c.$87.6m) market cap considerably. What’s more, this figure doesn’t include the ‘district-scale potential’ Asiamet expects to be on offer in the area surrounding the project. This point was highlighted last month when institutional investor JP Morgan took advantage of a slump in Asiamet’s share price amid the resource market downturn to increase its stake to 9.37pc.

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

The Author has not been paid to produce this piece by the company or companies mentioned above

Catalyst Information Services Ltd, the owner of MiningMaven.com, has not been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and Catalyst Information Services Ltd are not responsible for its content or accuracy and do not share the views of the author.  News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

Kavango Resources (LSE:KAV) sat at 2.9p on Monday morning after revealing ‘extremely encouraging’ initial drilling results at the Ditau prospect on its Kalahari Suture Zone (KSZ) project in Botswana.

The firm said the first hole drilled at the site encountered a 200m zone of intensely altered rock holding a 70m area containing significant sulphide alteration. This presented indicative cobalt values of up to 0.9pc and a weighted average of 0.2pc cobalt alongside elevated copper, zinc, lead, and nickel values. Kavango’s chief executive Michael Foster said this is ‘suggestive of mineralisation at depth’.

The core from the hole – which is called DitDDH1 – will now be sent to an accredited international laboratory for geochemical analysis and assay. Kavango will release final assay results when they become available.

The business has now begun drilling a second hole called DitDDH2 on a second conductive body based 1.8km east of its first target. Elsewhere, Kavango has now drilled a water well at Ditau to facilitate drilling and remove the need to cart water over long distances.

Foster added: ‘This hole is already advancing to plan and is benefitting from the new water well. We will continue to announce further drilling results from Ditau in a timely fashion.’

Kavango holds 15 prospecting licences covering 9,231km2 of ground in Botswana, including most of the 450km long Kalahari Suture Zone (KSZ) magnetic anomaly in the southwest of the country.  Here, it is exploring for copper, nickel, and platinum group element-rich sulphide orebodies. Kavango’s co-founder Mike Moles recently authored a piece for MiningMaven on how these formations occur and why the firm is keen to locate them, which can be found here.

The KSZ is yet to be examined using modern drilling techniques. However, Kavango argues that it has a similar geological setting to the giant Norilsk copper/nickel deposits in Siberia. Speaking last year, Moles said that Kavango only needs to find one sulphide deposit on the KSZ deposit to demonstrate its prospectivity and that the Norilsk model is applicable.

The business announced that it was launching an initial 1,000m drill programme at Ditau at the end of January. This has been designed to intersect two ‘very compelling’ coincident geophysical and geochemical base metal conductor/anomalies.

The anomalies extend north-south for at least 4km and are coincident with zinc in soil anomalies at the surface. Zinc acts a pathfinder for potential base metal mineralisation at depth because it is the most mobile of the base metal elements.

Meanwhile, the company has mobilised the second phase of an airborne electromagnetic survey over its remaining licences in the KSZ. The airborne EM survey detects and prioritises potential locations for these sulphide deposits, which Kavango can then follow up with more detailed groundwork and drilling.

Flying for the second phase of the survey began towards the end of February and is expected to take between four to six weeks to complete. It will cover up to 2,062 line-kilometres in the Hukunstsi area of Botswana.

 

A map showing Kavango’s licences in Botswana’s Kalahari Suture Zone

 

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

The Author has not been paid to produce this piece by the company or companies mentioned above.

Catalyst Information Services Ltd, the owner of MiningMaven.com, has not been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and Catalyst Information Services Ltd are not responsible for its content or accuracy and do not share the views of the author.  News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

Chesterfield Resources (LSE:CHF) recently came to market to provide investors with an opportunity to access the vibrant copper market through the formerly-thriving mining jurisdiction of Cyprus. Fresh from the firm expanding its land package considerably on the back of strong gold prospectivity, executive chairman Martin French talks us through what investors can expect over coming months in this exclusive Q&A session…

Can you tell me about the formation of Chesterfield Resources?

We started as a group of investors looking for exploration opportunities in copper. We believe the current supply/demand dynamics within the market for the metal present an excellent opportunity for investors.

Cyprus has always looked like a fantastic opportunity to me. The word “copper” even comes from the Latin word for Cyprus – Cyprium. Historically, the island has always been significant for the metal. Not many people know, it was a big producer in the 1960s and early 1970s. However, following the Turkish invasion of 1974, the industry was stopped in its tracks.

This was also around the time that the Vietnam War was drawing to a close, meaning that copper demand has begun to decline. Alongside this, explorers and producers began to discover large porphyry systems in Latin America. All this has meant that the industry’s needs were met elsewhere. Essentially, we felt this indicated that an area that was once a very vibrant producer of copper had been mothballed for 45 years. It looked like a great area to approach.

Chesterfield’s particular opportunity arose because we discovered that third parties did not hold many of the licences covering previously-copper producing areas. The government still owned them. This gave us an opportunity to go out and acquire an expansive licence area with relative ease.

So, against this backdrop, has your interest in revitalising Cyprus’s copper industry been reciprocated by the island’s government?

For some time, there have been two main industries in Cyprus. One is the tourism sector, which caters in particular to the British. The other is financial services. However, over recent years, the latter has come under an increased compliance restrictions from EU regulators. This is creating some pressure on the Cypriot financial services industry.

I think Cyprus now wants to diversify from its traditional, hallmark economic drivers. The fact that companies like Chesterfield are coming in to revive the island’s mining industry ought to be attractive from the government’s point of view.

Handily, the strong links between the UK and Cyprus – which have arisen mainly thanks to the area’s booming tourism industry – are working in our favour. Indeed, Cyprus’s legal system is based on English Common Law, two RAF bases are actually British Overseas Territories, and – for what it’s worth – they even drive on the ‘wrong’ side of the road (like us Brits do). All of these connections have made it a great country in which to operate – perhaps even more so than jurisdictions like Spain and France, where some of our peers are targeting. As it stands, from a mining perspective, Cyprus is a relatively benign place. We have found the mining regulatory authority very helpful.

Although there were a few miners that attempted to enter the territory during the last resources boom, no one has really come into the area as we have. We have acquired quite a large land package, and – speaking globally - this is very unusual given the area’s previous prospectivity. So we have a significant first mover advantage. Going forward, however, we hope and expect other resource firms to join us in the area.

Can you tell me about the assets, and what made you pursue them?

At the moment, the ground we have in the Troodos area is brownfield exploration. We are exploring for mineral deposits as well as studying historical dumps for other revenue opportunities. We did around 3,000m of preliminary drilling before Christmas within the areas in which we had been permitted to work. Fortunately, much of this is based in the vicinity of significant, historical mines.

Cyprus is well known for hosting volcanogenic massive sulphide (VMS) ore deposits. So much so, that geology students often go out to the island to study its rock structures. With this in mind, the real surprise for us was that we hit surprisingly high levels of gold, as well as copper. We have also discovered more recent epithermal systems, which we did not expect. This, therefore, means that mineralisation is hosted in at least two types of systems, which is very exciting.

Our work so far has mainly taken place at our Troodos West licences, and we are starting to generate a large number of targets here. We have also begun to receive permits at the grants we applied for in Troodos North, which we announced last month. We will now be working to generate targets here before drilling them and exploring what they can offer.

As it stands, there is one target in particular that could represent a near-term revenue project for us. This is a pit called Limni. It was refilled with about 10MMts of waste material, and we are fairly sure that it contains a large amount of copper in water solution. When it rains heavily, the pit even starts to overflow with this bright blue liquid – as sure a sign of mineralisation.  We are looking to drill into Limni and see if we can extract this and should be talking more about that soon. It is an exciting possibility for us.

A map of Chesterfield’s holdings in the belt surrounding Cyprus’s Troodos Mountains

You also recently announced a substantial expansion of your exploration programme; can you talk me through this?

Of course, this was launched mainly off the back of the strong results we received from our early drilling – the gold levels really marked a step-change in the pace of our activities. Initially, we applied for permits over around 60km2 of land, principally covering Troodos West and North, but as our drilling results started to look so strong, we decided to up the ante.

We have applied for licences that will essentially more-than-triple our mineralisation exploration land package in the highly prospective belt surrounding the Troodos mountain range. Once you submit a licence in Cyprus, no-one else can apply for it. Provided these are granted, we will become the dominant player on the island in terms of exploration acreage – we are very much gunning the engines. We will take this land package and start to explore it straight away. There really is a lot you can do very quickly with remote sensing and archival data to begin generating target lists.

Obviously, we cannot drill until we have the permits, so the immediate plan is to focus on the licences that we already have permited. We hope to start drilling again mid year, but this could come even sooner because our contracted drill is held in our facility, meaning it is easily accessible.

Alongside this, we will be exploring our additional land and, as can be seen in our recent newsflow, we have been hiring new staff to support our larger operations. Notably, this includes First Quantum veteran Michael Parker, who has joined us as chief operating officer. Mike was instrumental in two huge discoveries for First Quantum and was the organisation’s country manager for the DRC and then Peru. He is an extremely experienced and senior individual, and a company of our size would not normally expect to be able to hire a person of that calibre.

This sounds like a large amount of work; can you talk me through Chesterfield’s cash situation?

Of course, as it stands, we have around £1.6m in the bank, meaning we are pretty well funded. Of course, the degree to which this can stretch is dependent on the amount of drilling we decide to do. Regardless, I feel quite confident in saying that we have sufficient funds for our activity in 2019.

So, what is the long-term plan?

We are in Cyprus to make commercial discoveries, and we are very confident that we can do that. We have exploration techniques that were not available to companies operating in the region back in the heady days of the 60s and 70s, and we also have a vastly improved knowledge of the area’s geology.

Alongside this, drilling was very slow and expensive back in the days when Cyprus’s mining industry was booming. Miners tended to rely on finding mineral expressions at the surface and following them down. They were not really exploring and  drilling in the way we think of it these days.

Furthermore, there are quite a few areas where we can see mineralised structures going under cover. In volcanic regions, these formations tend to go under basalt and old lava flows. In the past, these would have gone entirely un-noticed by operators due to technological restrictions.

This combination of greatly-improved geological understanding and massively-improved exploration techniques means that, in our eyes, we are approaching the asset as if it were new with the knowledge that it is already prospective.

Author: Daniel Flynn

The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.

The Author has not been paid to produce this piece by the company or companies mentioned above

Catalyst Information Services Ltd, the owner of MiningMaven.com, has not been paid for the production of this piece by the company or companies mentioned above.

MiningMaven.com and Catalyst Information Services Ltd are not responsible for its content or accuracy and do not share the views of the author.  News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance

 

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