Share Talk Weekly Mining Sector News Round-Up, Sunday 2nd October 2022

Another busy week across the mining resources sector, here is our weekly recap.

Author @ABMckinley

Eurasia Mining (LON: EUA) Mkt Cap £150m – Interims highlight increased production at West Kytlim with M&A discussions over a potential transaction ongoing.

Interim Results for the six months ended 30 June 2022

  • *West Kytlim operations commenced on schedule with three wash plants up and running following the winter prestripping season.
  • Works on connecting the site to the grid continued including the installation of an electric draggling and a power line to site progressing through the summer months.
  • A total of 434,000m3 PGM bearing gravels were processed at the site through to 31 August 2022.
  • Production increased to 167kg raw platinum (FY21: 113kg) reflecting higher processed volumes with the material shipped to a secure location in Ekaterinburg for later refining.
  • The team decided to stockpile the concentrate given strong cash position in anticipation of stronger realisable prices in the market.
  • The Company estimated that 167kg PGM concentrate has a net realisable value of c.£3m (platinum only).
  • Exploration drilling along with geological mapping, soil and stream sediment sampling carried at the adjacent 24.5km2 potentially extending life of mine at West Kytlim.
  • The DFS work for the Monchetundra open pits at West Nittis and Loipishnune is well advanced and on schedule for completion and subsequent submission to local authorities before YE.
  • M&A discussions regarding a potential sale of Russian assets are ongoing and carried predominantly with Russian, Indian and Chinese non-sanctioned counterparties.
  • To date there has been no significant impact on the Group’s activities as a result of the ongoing updates to the UK and EU sanctions legislation.
  • Financially, PAT amounted to £3.9m (H1/21: -£1.5m) reflecting revaluation of assets and liabilities with an appreciation in the RUB leading to a net gain of £6.1m in H1/22.
  • Admin costs contained at £1.3m (H1/21: £1.2m).
  • Sales totalled £0.1m (H1/21: £0.4m) reflecting lower volumes.
  • FCF was -£7.1m (H1/21: -£2.5m) reflecting higher charge for working capital amid an increase in unsold inventories as well as higher capex during the period.
  • Closing cash balance stood at £13.6m with £0.7m in debt and lease liabilities (Dec/21: £22.0m and £0.5m)

The first half of 2022 has seen significant progress at our West Kytlim mine, as described in the Operations Update below. Eurasia’s plan to install grid power to site to reduce the carbon output associated with overburden stripping, while also reducing operational expenditure and improving efficiency, is advancing well and our electric dragline, which is currently being assembled, is aimed to significantly improve the stripping programme this coming winter.

Great Western Mining Corporation PLC (AIM: GWMO) will establish a new Nevada precious metals production plant in Nevada with Muletown, an affiliate partner of Tipton Trucking.

The new venture will be called Western Milling. It will be owned jointly by both companies. The first project will be a gravity separation plant built on land leased to Muletown, near Mina.

Western Milling’s first stage will produce precious metals out of tailings and spoil heaps and stockpiles of pre-mined material.

The venture will purchase material from third parties at a second stage. There is no comparable facility in the area.

Kibo Energy PLC (LSE: KIBO) announced plans for a spin-off of its renewable/clean generation projects into a new business via an IPO. Kibo stated that it hopes the new company to be called Ultimate Sustainable Energy Ltd. (USE) will be listed on AIM. Funds from the IPO will be used to develop renewable/clean energy generation and other projects.

Kavango Resources PLC, (LSE: KAV) stated that its infill soil sampling was able to increase the target resolution at its Kalahari Copper Belt license PL082/2018 in Botswana. This is ahead of drilling. The metals explorer expanded its existing target zones in PL082/2018 and added another (Middle Zone).

The Company has signed a contract with Mindea Exploration and Drilling Services Pty (“Mindea”) for the first phase of drilling on licence PL082/2018. Kavango’s technical team believes this prospecting licence (“PL”) is a possible analogue to Khoemacau’s Banana Zone deposit.

Kavango Resources chose thirteen priority exploration areas from four prospecting licenses it holds in the Kalahari Copper Belt, (KCB), Botswana.

According to the group, the goal is to discover copper/silver deposits that are economically viable.

Emmerson PLC (AIM: EML). is well-positioned to profit from the fertiliser market according to analysts at Shore Capital, Liberum.

Shore Capital stated that the potash development company has the “full funding” to finish the detailed engineering work, permit and project financing processes and make a decision on construction.

Phoenix Copper Ltd (AIM: PXC) has increased its investment in its Empire Mine. Drilling continues at the site despite the economic downturn.

Chairman Marcus Edward-Jones stated that “the outlook has deteriorated” at least in the short term. “Copper, sterling and silver have been both extremely volatile and are currently at 30% below their highest levels for the year.”

Power Metal (AIM: POW) Molopo Farms Complex Project, Botswana – Major Drill Target T1-3. stated that results of an electromagnetic survey at Molopo Farms in Botswana’s T2-3 target have revealed a “large and significant geophysical conductor”.

According to the statement, the conductor is open in all directions and coincides strongly with a magnetic body that was identified by ground and airborne magnetic survey.

Oriole Resources PLC, (AIM: ORR) found multiple gold anomalies at the Fare prospect of the Senala Gold Project in Senegal. The results indicate that the area may be home to a “stand-alone” resource.

Fare’s gold assays on 2,551 samples revealed “multiple structurally controlled anomalies” that were not within the footprint previously identified, according to a statement by the gold exploration company.

Cornish Metals Inc. (AIM: CUSN) stated that it had completed more than 10,000 meters of drilling at the United Downs project, which “reaffirmed management’s belief in a potential to develop a resource mineral.”

According to the company, its four main targets were tested by drills and all four returned results that warranted further drilling.

Kodal Minerals PLC (AIM: KOD) Bougouni Project DMS Development Opportunity. The company is currently in discussions to finance its Bougouni Lithium project in Mali.

The capital cost to accelerate the development through dense media separation (DMS), an option that allows for accelerated development, is estimated at US$65mln. If fully funded by equity, the payback time will be two months.

The company calculated that this would result in a capital development cost of US$557mln or US$420mln after-tax. It also forecasts that this will generate revenue of US$1.05bn. This is based on a price of US$2,080 for a tonne of lithium. This price is well below current spot prices of US$5,000.

Greatland Gold PLC (AIM: GGP) has released a 3-D interactive model of the key Havieron project in Australia.

The Havieron project 3D interactive model is available to view on the Company website or by clicking this link. The model is for illustrative purposes only and uses previously reported JORC mineral resource estimates and drill results up to 8 September 2022. Any future Havieron production is subject to a positive Feasibility Study and decision to mine.

KEFI Gold and Copper PLC (AIM: KEFI) celebrated the progress made in 2022’s first half, which included the £8mln equity crowdfunding in April, which cleared its outstanding liabilities and “reinforced the momentum of its projects towards first gold pours towards 2024.”

At the end of June, it had £2.3mln in cash. All project participants signed an umbrella financing agreement for the Tulu Kapi Gold Project in Ethiopia.

Tertiary Minerals plc (LON: TYM), announced the start of a detailed soil sampling programme at the Jacks Copper Project (“in Zambia, where Tertiary has now earned a 90% joint venture interest from local Company Mwashia Resources Ltd.

The soil sampling programme at Jacks is targeting extensions to the known copper mineralisation as well as areas defined during wide-spaced soil sampling by FQM as having high Cu:Sc ratios which can indicate the presence of copper sulphide minerals in potentially economic concentrations.”

Alien Metals Ltd, (AIM: UFO) reported interim results and said that it had made “significant progress”.

Roderick McIllree, the new executive chairman, stated that “this half-year has seen significant progress across many projects with numerous exciting developments within our portfolios of precious and base metal commodities.”

Pure Gold Mining Inc, (LSE: PUR) announced that it has filed the previously-announced NI43-101 resource update for PureGold Mine in Red Lake, Ontario.

According to SRK Consulting Canada Inc (Canada), Inc., the August 2018 estimate showed that 1.65 million ounces at 7.4 grams per tonne, (g/t) were in the indicated category and 0.37 million ounces at 6.3 g/t, in the inferred.

Wishbone Gold Plc (AIM: WSBN, AQSE: WSBN) announced it has completed a 3D magnetic inversion model on the Anketell Gold-Copper Project (Figures 1-3) on which the company has taken an option.

The Anketell Gold-Copper Project is located ~85km north of the Company’s Red Setter Gold-Copper Project in the Patersons Range area in Western Australia.

Jangada Mines (AIM: JAN), an AIM-quoted natural resource company, achieved its first half performance thanks to the continued development of its 100%-owned Pitombeiras ferrovanadium mine in Brazil.

The company completed the current phase of its drilling program, posting a total mineral resources estimate of 8.26 metric tons (Mt), which is a 45% increase over the previous interim period.

After successful operations testing and regulatory clearance, Anglo American PLC (LSE: AAL) has begun commercial copper operations at Quellaveco in Peru.

Quellaveco will produce on average 300,000 tonnes of copper equivalent volume per year over the first ten years of its operation.

Thor Mining PLC, (ASX:AIM: THR) informed investors that drilling had begun at the Wedding Bell project and Radium Mountain project, both located in the historic Uranium-Vanadium mining district of southwest Colorado.

Thor stated that it will be a maiden drill campaign of 2,000 m. It is focused on Section 23 prospects, Groundhog, and Rim Rock.

Nicole Galloway Warland, Managing Director of Thor Mining, commented: Commencement of drilling at the Wedding Bell Project is a significant milestone for Thor. We look forward to testing these shallow, high-grade targets, especially Section 23, where Thor will be the first company to access and drill test this highly prospective area.

Vast Resource PLC (AIM: VAST). stated that it will raise £656,000 by placing 164mln shares at an average price of 0.04p each share. Due to delays in exporting the latest concentrate shipment due to shipping availability, the money raised will support the company’s operations over the next weeks.

Blencowe Resource PLC (LSE: BRES) stated that it has begun the Definitive Feasibility Study, (DFS), for its Orom-Cross graphite flagship project in Uganda.

This follows the “outstanding” results of the Prefeasibility Study (PFS), which was presented to the market in July. The DFS is the final step in major studies before the company decides to mine.

Emmerson PLC, (AIM: EML) has reached an agreement with Global Sustainable Minerals Pte Ltd, Gold Quay Capital Pte Ltd, to extend the commitment period to the previously announced US$40mln convertible note subscription to 30 September 2023. This will provide continued financing support for the development of the Khemisset Potash Project in Morocco.

Separately, Peel Hunt announced a retail offering of shares via REX. This proprietary technology platform is owned by Peel Hunt. A subscription to US$6mln with GSM for 6p per share was also announced.

Author @ABMckinley

The opinions expressed here are those of the author

Disclaimer: This blog is provided for general information and It does not constitute investment advice, not buy or sell shares, warrants or bonds in any companies written about within the blog. Information is taken from publicly available sources and any comment is that of the author.

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