MOD Resources

  • MOD Resources (LSE:MOD), already listed on the Australian ASX market joins the London Stock Exchange this morning. The copper exploration and development company joins the standard list of the Main Market with a Market Cap of around £62m at a share price of 25p.

  • Both MOD Resources (LSE:MOD) and Metal Tiger (LSE:MTR) were trading up on Tuesday following strong infill drilling results from the T3 copper project.

    So far, assay results have been received for 11 holes at the site, based in Botswana’s Kalahari Copper Belt and 100opc owned by MOD. These form part 60-hole programme that began in T3’s proposed open pit in January with the aim of upgrading early production into the high-confidence measured resource categories.

    Many strong intersections have been recorded, including one within hole MO-G-188D of 31.5m at 2pc copper from 85.6m downhole including 10m at 4.7pc copper from 105m downhole. Meanwhile, another hole called MO-G-192D intersected 33m at 2pc copper including 16m at 3.3pc copper from 99m.

    MOD was trading up 2.7pc to 19p on the news as at writing. Managing director Julian Hanna said the initial results demonstrate the high-grade nature of the veins within the T3 open pit.

    ‘The initial results published today from the T3 infill drilling program are very strong. They continue to support and validate the accuracy of the resource model while also identifying significant new copper intercepts within the early stages of the planned open pit,’ he added. ‘These wide, high-grade intersections are increasing our confidence in the quality and continuity of the resource. In addition, they provide encouragement of the potential to increase the current open pit resource.’

    All-in-all, MOD has so far drilled 25 of the 60 holes, utilising up to three drill rigs. It expects to complete the remaining 35 infill drill holes by the end of H1 2019, ahead of both the proposed T3 open pit ore reserve and feasibility.

    MOD said the latter remains on track for completion by the end of March 2019. A pre-feasibility study on the project gave it a base case NPV of $281m and only weeks after a resource upgrade gave it a total mineral resource estimate of 590Kt copper and 27Moz silver.

    Metal Tiger, which sold off its position in T3 last year but retained exposure through its 10.5pc stake in MOD, also rose on the news, advancing 3.9pc to 1.35p. The jump came despite a separate RNS showing that the company’s cornerstone investors Sprott had reduced its stake slightly from 13.7pc to 12.9pc.

    On the infill drilling results, chief executive Michael McNeilly said: We are pleased to report the significant infill drilling intersections from MOD’s T3 project in Botswana. The infill drilling programme is expected to allow a significant portion of the Mineral Resource to be categorised as Measured, with these initial results also providing the prospect of increasing the current open pit resource.

    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.

  • This morning, MOD Resources: (LSE:MOD) and Metal Tiger (LSE:MTR) released an update on drilling at A4 Dome in the central Kalahari Copper Belt in Botswana. The A4 Dome forms part of the T3 Expansion Project in which MOD holds a 70% working interest alongside joint venture partner, Metal Tiger.

    MOD stated the initial phase of drilling is supportive of the company’s strategy to define additional sources of ore within the T3 Expansion Project which could result in increased production through the planned T3 processing plant.

    To date only one-third of the approximately 5km long prospective area has been tested which lies only 8km from MOD’s 60Mt T3 Copper Project. Drill hole intersections included significant widths and grades of both vein and Ngwako Pan Formation (NPF) contact type mineralization.

    Independent underground mining consultants, Entech Pty Ltd, have undertaken a preliminary, conceptual underground mining study of the A4 Dome using inputs from one of Australia’s leading underground mining service providers, Barminco, a subsidiary of AusDrill. The study gives positive outcomes for a combination of room-and-pillar ore extraction of higher-grade contact mineralisation and long hole open stoping mining of the NPF contact related mineralization via a decline from surface. 

    The NPF contact is an important regional target in the Kalahari Copper Belt as it hosts substantial deposits including the 100Mt @ 2% Cu 'Zone 5' resources held by Cupric Canyon Capital, around 125km east of A4 Dome.

    MOD's Managing Director, Julian Hanna, said: "Recent drilling results from the A4 Dome, combined with the preliminary conceptual underground mining study, provide strong support to expand drilling along the dome and start developing it into a resource. If results continue to be positive, the A4 Dome has potential to provide substantial additional ore sources, which may lead to an increase in production levels through the proposed T3 process plant, only 8km from the A4 Dome."

    "While the feasibility study for the T3 Copper Project is nearing completion, and represents a robust, long-life, stand-alone mining opportunity for the Company, the nearby A4 Dome keeps delivering good results. The large scale of the A4 Dome, and the potential to utilise capital and infrastructure planned at T3, has allowed us to consider modern, highly efficient underground mining techniques as a realistic option for A4 Dome."

    A decision to progress the A4 Dome programme towards a potential mineral resource estimate is expected to be made early 2019.

    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

     

     

     

  • MOD Resources (LSE:MOD) soared 57.3pc to 22.5p yesterday after revealing an unsolicited takeover bid from a major copper miner. The ASX-listed resources firm, which dual listed in London last November, received the proposal from fellow Australian business Sandfire Resources. MOD’s largest shareholder Metal Tiger (LSE:MTR) also rose 27pc to 1.6p on the news.

    Sandfire offered to acquire 100pc of MOD’s shares at $0.38 each, valuing the firm at $113m. However, MOD said it believed the indicative proposal undervalued its assets. Despite this, it said it would be ‘willing to engage’ with Sandfire if it presents a more compelling price.

    MOD is the owner of the 60Mt T3 copper project in the centre of Botswana’s highly prospective Kalahari Copper Belt (KCB). The company is progressing a feasibility study for the project, which it expects to release by the end of Q1 2019. This is expected to help it reach a decision to mine within the first half of the year.

    The firm believes that its flagship asset presents the potential for a long-life, high-margin, open-pit copper mine with significant exploration upside. Indeed, based on its pre-feasibility study, the asset has an NPV (pre-tax) of $370m under the base case and $529m under the expansion case.

    In yesterday’s update, MOD gave many reasons for considering Sandfire’s initial offer insufficient.

    First-of-all, the company highlighted its dominant position in the KCB, which comes in at around 11,700km2 in granted licences. It called the area ‘one of the last under-explored sediment-hosted copper belts’, adding that exploration results have already indicated the potential for additional copper mineralisation.

    Elsewhere, the business pointed to T3’s prospectivity. It said it expects the project to produce a high-grade, high-quality concentrate that will attract keen interest from metal traders and smelter. It also claimed to have confidence in a range of alternative funding options for progressing T3 to production following third-party discussions.

    Finally, MOD pointed to the fact that its share price and the MOD/SFR exchange ratio are at a 2.5-year low. Extending this point, it highlighted its most recent $0.47 per share placing price.

    Managing director Julian Hanna said the proposal confirms the potential of the T3 Copper Project. However, he said ‘significantly undervalues’ the company’s assets.

    Elsewhere in Monday’s update, MOD announced that it had carried out a $10m placement with institutional and sophisticated issued. It issued the shares at $0.30 each, a 36pc premium to its last closing share price on ASX. It will now follow the placing with a rights issue to raise c.$5m from eligible shareholders. This will be priced at $0.24 per share.

    MOD said the funds would be used to complete a 2019 capital works programme. This will see it progress T3, purchase a farm on which the T3 open pit is based, complete underground mining studies, and carry out follow-up exploration work. It will also fund infill drilling to upgrade part of the early stages of T3 mine production to a JORC compliant Measured Resource category. Finally, MOD said the money would enable it to progress negotiations with numerous parties around funding T3’s future development.

    Hanna added: ‘Funding from this capital raise will enable the Company to progress the T3 Copper Project towards a development decision and conduct further drilling for additional resources. With strong ongoing support of our shareholders through a placement and a fully underwritten rights issue, we believe that the Company will have sufficient working capital to achieve our objectives.’

    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