SP Angel Morning View -Today’s Market View, Thursday 28th September 2023

Gold extends losses as higher oil and stronger US goods orders lift the dollar

MiFID II exempt information – see disclaimer below

Ango Asian Mining* (AAZ LN) – BUY – TP Under Review – Micon environmental review conclusions

Atlantic Lithium* (ALL LN) – STRONG BUY – Annual report following delivery of DFS and submission of Mining Lease application

Celsius Resources* (CLA LN) – Approval of the feasibility study for the MCB project

Cornish Metals* (CUSN LN) – Start of wet-commissioning of the water treatment plant at the South Crofty mine

Hummingbird Resources (HUM LN) – Interim results as Kouroussa steady state production looms

Phoenix Copper* (PXC LN) – Interim results highlight financing developments for the Empire pit and exploration progress at Navarre Creek & Red Star

Sovereign Metals* (SVML LN) – STRONG BUY – Kasiya rutile project shows robust economics in Pre-Feasibility Study

Strategic Minerals* (SML LN) – Cobre maintains profitability despite dip in US economic growth

Wishbone Gold* (WSBN LN) – Interim results highlight drilling at the Red Setter and Cottesloe projects, WA

IGTV: Copper will still move up despite a gear shift down in carbon-zero targets  https://youtu.be/jbywf2hmEU8?si=yxJcwGiE1_V121Ok

VOX:    https://audioboom.com/posts/8372001-john-meyer-discusses-heat-pumps-the-energy-transition-plus-bluejay-jay-kodal-kod-savannah-sav


*SP Angel almost invariably acts as nomad or broker or nomad and broker to companies mentioned in the above videos and podcasts. We speak more about these companies as we have a good understanding of their business and can talk with a greater degree of confidence. As ever, however, it should be noted that our views do not take into account the circumstances and needs of any particular investor or investor type. So enjoy the talks, but please do your own research, including other companies not mentioned by us but operating in the same areas, and get professional advice where appropriate.

Gold extends losses as Treasury sell-off intensifies and dollar pushes higher

  • Gold prices fell lower to $1,876/oz.
  • The sell-off marks the steepest daily decline in two months yesterday.
  • The dollar pushed past its 10-month highs and yields climbed to their highest in 16 year.
  • The 10-year pushed past 2007 levels to 4.65%.
  • Durable goods data from the US showed a rally in business momentum expectations.
  • Focus turns to today’s GDP data for Q2 and weekly jobless claims. PCE data on Friday will be crucial for gold bulls.

Copper recover from weakness despite dollar strength weighing on Chinese buying appetite

  • Copper prices weakened to $8,070/t yesterday before climbing back to $8,170/t this morning.
  • LME copper stockpiles pushed higher to 167kt, their most elevated level since May 2022.
  • Analysts point to high copper import levels in August to China at 340kt, their highest level this year.
  • However, cumulative imports of 2.29mt this year down by 8% yoy and net imports down 10%. (Reuters)
  • Codelco announced today that it expects production declines to stabilise next year, with a slight recovery.
  • The Chilean giant expects this year to be the Company’s worst, with production seen to increase to 1.7mt by 2030.
  • Codelco’s production this year is forecast at 1.3mt.
Dow Jones Industrials -1.14% at 33,619
Nikkei 225 +0.18% at 32,372
HK Hang Seng +0.63% at 17,577
Shanghai Composite +0.16% at 3,107



  • Economic sentiment falls to 93.3 from 93.6
  • Employment expectation indicator rose from 102.2 to 102.7
  • Economic uncertainty indicator rose from 19.8 to 21.5

US Durable Goods

  • Orders rise 0.2% to US$285bn vs expectations of a -0.4% mom decline.
  • Ex-defense orders fell -0.7% mom


US$1.0512/eur vs 1.0573/eur previous. Yen 149.32/$ vs 149.05/$. SAr 19.194/$ vs 19.053/$. $1.215/gbp vs $1.215/gbp. 0.637/aud vs         0.638/aud. CNY 7.305/$ vs 7.305/$.

Dollar Index 106.57 vs 106.23 previous.

Commodity News

Precious metals:

Gold US$1,877/oz vs US$1,897/oz previous

Gold ETFs 88.1moz vs 89moz previous

Platinum US$893/oz vs US$910/oz previous

Palladium US$1,230/oz vs US$1,247/oz previous

Silver US$22.54/oz vs US$23/oz previous

Rhodium US$4,100/oz vs US$4,100/oz previous

Base metals:

Copper US$ 8,143/t vs US$8,110/t previous

Aluminium US$ 2,254/t vs US$2,233/t previous

Nickel US$ 18,950/t vs US$18,570/t previous

Zinc US$ 2,519/t vs US$2,487/t previous

Lead US$ 2,158/t vs US$2,166/t previous

Tin US$ 25,610/t vs US$25,650/t previous


Oil US$97.2/bbl vs US$94.6/bbl previous

  • Crude oil prices edged higher after the EIA reported a 2.2mb w/w US crude draw, offset by small builds to gasoline and distillate stocks, with refinery utilisation falling by 2.4% to 89.5%.
  • European energy prices edged lower as EU natural gas storage levels rose 0.9% w/w to 95.2% full (vs 86.8% 5-Yr average), with all EU nations reporting storage levels above 90% full to lift overall storage to 1,084TWh.
  • TotalEnergies announced the $400m sale to Petronas of a 40% interest in Block 20 in the offshore Angola Kwanza Basin, which is expected to take FID on the development of the Cameia and Golfinho fields by YE23.
  • TotalEnergies announced a dry well on the Nara prospect offshore Namibia during its CMD presentation yesterday, while also outlining a plan targeting FID by YE24 and first oil in 2028 on its Suriname discoveries.

Natural Gas €40.650/MWh vs €38.750/MWh previous

Uranium UXC US$70/lb vs US$65.50/lb previous


Iron ore 62% Fe spot (cfr Tianjin) US$115.8/t vs US$115.0/t

Chinese steel rebar 25mm US$539.7/t vs US$483.2/t

Thermal coal (1st year forward cif ARA) US$129.5/t vs US$129.5/t

Thermal coal swap Australia FOB US$161.5/t vs US$163.0/t

Coking coal swap Australia FOB US$324.0/t vs US$322.0/t


Cobalt LME 3m US$33,420/t vs US$33,420/t

NdPr Rare Earth Oxide (China) US$70,976/t vs US$71,319/t

Lithium carbonate 99% (China) US$21,012/t vs US$21,012/t

China Spodumene Li2O 6%min CIF US$2,290/t vs US$2,290/t

Ferro-Manganese European Mn78% min US$1,020/t vs US$1,026/t

China Tungsten APT 88.5% FOB US$305/mtu vs US$305/mtu

China Graphite Flake -194 FOB US$645/t vs US$645/t

Europe Vanadium Pentoxide 98% 6.6/lb vs US$6.6/lb

Europe Ferro-Vanadium 80% 29.25/kg vs US$29.25/kg

China Ilmenite Concentrate TiO2 US$316/t vs US$316/t

Spot CO2 Emissions EUA Price US$86.1/t vs US$86.6/t

Brazil Potash CFR Granular Spot US$350.0/t vs US$350.0/t

Battery News

EU new car sales up 21% in August, EVs exceed 20% share for first time

  • Double-digit percentage gains were observed in major markets like Germany (+37.3%), France (+24.3%), and Italy (+11.9%).
  • From January to August 2023, new EU car registrations grew by 17.9%.
  • EVs exceeded a 20% market share in August, surpassing diesel for the second time this year.
  • Hybrid-electric cars held a 24% market share, while petrol cars’ market share decreased to 32.7%.
  • Hybrid-electric car registrations expanded by 29% in August, with significant growth in Germany (+59%), France (+38.7%), and Spain (+21.5%).
  • The EU diesel car market continued to decline in August (-6%), with a market share of 12.5%.
  • Overall, BEV sales increased by a significant 62.7% from January to August.

Ford pauses $3.5bn battery plant construction amid ongoing autoworkers’ strike

  • The carmaker announced on Monday that it would halt work and limit spending on construction for the plant, where it will build batteries with licensed technology from CAL.
  • Ford said the pause in works would remain in place until it was sure it could operate the plant competitively.
  • United Auto Workers union continue to strike at the three major US carmakers, including Ford.
  • The deal announced in February between Ford and CATL had previously drawn criticism from Republican lawmakers.

Company News

Ango Asian Mining* (AAZ LN) 61p, Mkt Cap £70m – Micon environmental review conclusions

BUY – TP under review

  • The Company reports on findings of the Micon environmental review of the tailings management at Gedabek operations.
  • No technical issues with the current tailings dam or the proposed location for the new tailings storage facility were found.
  • Soil samples returned no cyanide identified over analytical detection limits with low concentrations detected in four water samples of total 35 collected, although, those were within IFC Environmental guidelines.
  • No issues with air quality were identified.
  • The report concludes that opposition to the proposed new tailings storage facility was the result of a “lack of proactive communication between the site management team and the local community, longstanding issues regarding land allocation and mineral rights, and the failure to follow accepted international protocols for public consultation”.
  • As a result, one of main recommendations included creating a dedicated community relations department for proactive stakeholder engagement.
  • The audit involved three Micon employees visiting operations between 25 and 27 July accompanied by IQLIM Environment Analytical, a local environmental engineering company, that collected soil and groundwater samples.
  • Additionally, air quality was tested using portable equipment measuring levels of gas, dust, noise, vibration and radioactivity.
  • The Company engaged Mine Environmental Management to accompany Micon and IQLIM during their site inspections along with Knight Piesold, a Company’s tailings dam consulting engineers.
  • Samples collected from the site were duplicated and tested in a separate accredited laboratory.
  • The review was commissioned following protests by local residents earlier in July over construction of a second tailings dam next to the existing facility.
  • The Board is in close contact with authorities and local communities regarding review findings and next steps towards resumption of milling operations at Gedabek.

Conclusion: Results of the review highlight no structural issues with existing tailings dam and the proposed new site supported by soil, air and water samples collected. Nevertheless, Micon recommended the Company to improve on its local community engagement and environmental monitoring procedures to minimise social and environmental risks in the future. We believe conclusions of the review significantly de risk planned resumption of operations while, ultimately, strengthening relations between all stakeholders including local community, authorities, employees and shareholders.

*SP Angel acts as nomad and broker to Anglo Asian Mining

Atlantic Lithium* (ALL LN) 25p, Mkt Cap £157m – Annual report following delivery of DFS and submission of Mining Lease application

(Piedmonth can earn into up to 50% of the Ewoyaa lithium project through the expenditure of around 70% of the project capex)


  • Atlantic Lithium reports its full year results ending June 30th 2023.
  • The company held a cash position of A$15.3m at year end and has since received a US$32.9m investment commitment from the Ghana Mineral Income Investment Fund to develop Ewoyaa.
  • Piedment has committed to fund the first US$70m and 50% of an additional development spend of the total $185m CAPEX requirements.
  • Atlantic has launched a mine build team in Perth and Ghana and appointed Aaron Maurer as Head of Operational Readiness.
  • DFS project economics:
    • Throughput: ~2-2.7mtpa
    • Total mined ore 30.6mt
    • Spodumene concentrate production ~300,000tpa  (SC5.5 and SC6)
    • The production ‘target’ is higher than for the DFS due.
    • Assumption US$1,587/t with $1,200/dmt long term pricing for SC6% FOB Ghana Port
    • NPV8 post-tax: US$1.5bn
    • IRR: 105%
    • Payback: 19 months
    • Free cash flow: US$2.4bn life-of-mine
    • EBITDA: US$316mpa
    • Revenue US$550mpa and $6.6bn life-of-mine
    • C1 Op costs US$377/t
    • AISC US$610/t
    • Capex: US$185m
    • LOM: 12 years
    • LOM revenues increased to $6.6bn
  • Mineral resource for DFS:  35.3Mt grading 1.25% Li2O including ore reserves of 25.6mt grading 1.22% Li2O.
  • The resources is based on a total 137,153m of drilling with 47,000m completed last year.
  • Going forward, Atlantic awaits the award of the Mining Lease, which management hopes will be granted shortly, progressing the project towards permitting.

*SP Angel acts as Nomad to Atlantic Lithium. Two mining analysts from SP Angel recently visited the Ewoyaa mine site in Ghana and drove onto Takoradi to check the quality of the road to port. Our intrepid analysts also visited the Ministry of Minerals Commission and MIIF, the Ghana Minerals Income Investment Fund.

Celsius Resources* (CLA LN) 0.63p, Mkt Cap £13.5m – Approval of the feasibility study for the MCB project

Click Link for SP Angel research report PDF note – MCB project NPV@8% US$463m, IRR of 34.3%


  • Celsius Resources has announced that it has now received official approval of its plans to develop the MCB copper/gold project in the Philippines, clearing the last of the permitting steps required for obtaining a Mineral Production Sharing Agreement (MPSA) and the issue of a mining permit.
  • The company’s plan envisages development of an underground mine to develop the 338mt resource at MCB over a 25 year mine life and produce a copper/gold concentrate.
  • Initial investment of US$253m is expected to deliver an after-tax NPV8% of US$464m and IRR of 31% at a copper price of US$4.00/lb (~US$8,800/t) and a gold price of US$1,695/oz.
  • The plan is to process an average of around 2.3mtpa of ore at an average grade of 1.14% copper and 0.54g/t gold during the initial 10 year of the project delivering cash costs of cash costs of US$0.73/lb net of gold credits.
  • Executive Chairman, Julito Sarmiento, confirmed that the issue of the Declaration of Mining Project Feasibility (“DMPF”) for the MCB Project “is one of the key final milestones in the … permitting process” and said that “we are anticipating the mining permit to be delivered within a short period of time”.
  • Celsius Resources will now require finance to develop the MCB project, however, there is a global scarcity of development ready copper projects and a growing awareness of impending demand growth to supply carbon reduction technologies which recently saw the US Department of Energy add copper to its ‘Critical Minerals’ list.

Conclusion: After completing the permitting process, Celsius Resources is now expecting to secure an MPSA and delivery of a mining permit for its MCB copper/gold project in the near future.

*SP Angel acts as broker to Celsius Resources.

Cornish Metals* (CUSN LN) – 11.25p, Mkt cap £60m – Start of wet-commissioning of the water treatment plant at the South Crofty mine


  • Cornish Metals reports that commissioning of the water treatment plant at South Crofty is now underway.
  • The plant has a design treatment capacity to treat 25,000m3 per day of water from the historic mine workings prior to discharge of treated water into the nearby Red River.
  • Cornish Metals explains that the plant uses the proven High Density Sludge (“HDS”) process technology to treat raw mine water and meet the Company’s permitted standards for discharge … [and that] … Commissioning and building of the high density sludge bed is expected to take up to three weeks, with full dewatering of the mine anticipated to commence in October”.
  • The company explains that commissioning of the water treatment plant takes place in several stages:
    • Fill all the reaction tanks with water and check for leaks;
    • Electrically test each of the motor and control circuits, commission the reagent addition modules, supplied as package plants from third party suppliers, and receive first fills of all reagents; and
    • Start running the plant and treating the water to allow a bed of thickened (high density) sludge to build up within the plant. This sludge building step is an essential part of the HDS process and is required to achieve the permitted water quality standards for discharge. During the sludge building process, the raw water from the mine is treated through the plant and then re-circulated back into the mine. Not until the plant is fully operational and performing to the required standards will any treated water be discharged to the Red River”.
  • CEO, Richard Williams acknowledged the hard work and dedication of the project team and its contractors in taking the water treatment plant from a conceptual flowsheet design through to a fully constructed plant over the last year.

Conclusion: Commissioning of the water treatment plant at South Crofty will allow de-watering of the old mine to start as a key step towards a resumption of mining which is currently the subject of a feasibility study expected to be completed by the end of 2024.

*SP Angel acts as Nomad and Broker to Cornish Metals. An SP Angel analyst formerly worked in the South Crofty tin mine in the 1980s and holds shares in Cornish Metals.

Hummingbird Resources (HUM LN) 9.95p, Mkt Cap £60m – Interim results as Kouroussa steady state production looms

  • Hummingbird reports its interim results for the period to 30th June 2023.
  • The Company reports sales of $98.6m vs $66.3m for the period last year.
  • 51.15koz were sold over the period vs 35.7koz sold same period last year.
  • Average gold price sold at $1,927/oz vs $1,859/oz same period last year.
  • Total group ASIC profile of $1,170/oz.
  • Adjusted EBITDA of $33m for the period vs a loss of $9.3m same period last year.
  • CAPEX of $41.5m for the period vs $31.9m same period last year on the back of the completion of construction of the Kouroussa Gold Mine.
  • Net Debt less gold inventory value of $119.3m.
  • Following the 30th June, Hummingbird has agreed a funding package with Coris Bank of $55m to support the ramp up of production at Kouroussa.
  • $77m is due in loan repayments in FY24, $61m due in FY25 and the balance of $15m is due by the end of 2028.
  • Updated reserves show 4moz and 6.95moz in resources.
  • Progressing underground development of Komana East at Yanfolila, expecting FY23 production a 80-90koz at an AISC of <$1,500/oz.
  • First gold pour at Kouroussa in June 2023, shipping c.1koz Au since then.
  • Steady state production at Kouroussa and full commercial production expected next year.

Phoenix Copper* (PXC LN) 18.25p, Mkt Cap £20.9m – Interim results highlight financing developments for the Empire pit and exploration progress at Navarre Creek & Red Star

(Phoenix holds 80% of the Empire mining property in Idaho)


  • In its interim results for the six months to 30th June, Phoenix Copper reports a loss of US$0.63m (2022 – US$1.05m loss).  Cash at 30th June amounted to US$2.75m.
  • The loss reported today includes a non-cash foreign exchange gain on sterling denominated assets of $96,172 (2022: foreign exchange loss of $503,593), and a charge of $18,992 (2022: $36,623) relating to non-cash share-based payments.
  • Chairman, Marcus Edwards-Jones confirms that Phoenix Copper is continuing to “make good operational progress at our Empire project in Idaho, both in terms of the development of the initial open-pit mine and the exploration of the surrounding mineralised district” with progress on the metallurgical test work for the Empire open-pit and the completion of a 60-hole drilling campaign at Navarre Creek.
  • Mr. Edwards-Jones also commented on the company’s plans to fund the development of the Empire open-pit “with minimal additional dilution to shareholders … [and said that] … With this objective in mind, we are currently finalising the documentation to create a class of authorised bonds in a total amount of $300 million, and to admit them to trading on The International Stock Exchange (“TISE”) in the Channel Islands, as a prelude to closing an initial tranche to raise up to $80 million.
  • He confirmed that Phoenix Copper has “been in discussion with a number of interested parties for some time, and we are hopeful that we can finally close the book in the near future  … [and while he cautions that ] … there can be no certainty until the bonds have been issued and settled, we are confident that the issue will close and that the Company will have access to the relevant construction funding when required.
  • Commenting on the exploration reverse-circulation drilling at Navarre Creek, Chief Executive, Ryan McDermott said that initial results from the 28 holes (3,300m) completed so far “are anticipated from late Q3 this year”.
  • He also highlighted the drilling results from the Red Star prospect which tested magnetic anomalies and showed that “assay values for copper, silver, lead, and zinc were consistent with previous drilling programs and he confirmed that “While our primary focus is on the engineering and development of the Empire Open-Pit Mine, a plan is being constructed for follow-up drilling at Red Star in 2024”.

Conclusion: Phoenix Copper is pursuing plans to finance the Empire pit with bonds and is also progressing metallurgical work alongside exploration at Red Star and Navarre Creek.

*SP Angel acts as nomad to Phoenix Copper

Sovereign Metals* (SVML LN) 22p, Mkt Cap £114m – Kasiya rutile project shows robust economics in Pre-Feasibility Study

(Sovereign currently holds 100% of the Kasiya project. The government has a right to a 10% free carry in the project)


  • Sovereign Metals reports results from its first Pre-Feasibility Study on the Kasiya Rutile (TIO2) / graphite project in Malawi.
  • The report shows robust returns based on production of rutile and graphite from the mine.
  • Rutile is in short supply globally and in strong demand supporting a resurgence in pricing for this premium TiO2 feedstock material.
  • Rio Tinto’s recent investment of A$40.4m into Sovereign Metals along with offers of support and expertise should help Sovereign build the Kasiya mine within the appropriate timescale.
  • Key results from the PFS:
    • NPV (8%) post-tax US$1,605m ,NPV (10%) post-tax US$1,205m
    • IRR of 28% ungeared
    • Mine life: 25 years – given the scale of the overall resource the mine life could extend to >60 years making this a multi-generational mine
    • EBITDA: US$415mpa, Revenue: US$16bn over 25 years
    • Throughput:
      • Stage 1 – 12,000,000tpa, Stage 2 – 24,000,000tpa – “Beginning to look Rio size”
  • Rutile:  Production 222,000tpa – makes Kasiya the world’s largest Rutile mine, with a growing deficit for Rutile and ilmenite feedstock
    • Head grade 1.03%, Recovery rate 100%, TiO2 product grade– Rutile 96%
  • Graphite: Production 244,000tpa – makes Kasiya also one of the world’s largest graphite mines, with demand coming from the lithium-ion battery sector
    • Head grade 1.66%, Recovery rate 67.5%, Graphite product grade 96%
  • Capex – Stage 1: US$572m – increased from the Scoping Study due to the acceleration of Stage 2 items such as the rail spur and water dam.
  • Expansion – US$652m for plants 2 & 3 funded from project cashflows, Inc. Stage 2: US$287m expansion to 24mtpa, Plant Relocation capex US$366m
  • Sustaining Capital: US$470m
  • Payback: 4.3 years
  • Operating Costs:  US$8.74/t mined (this compares with $4.3/t for hydro-mining at Kwale in Kenya)
  • Op Costs including royalties US$404/t– Freight on Board Nacala port, Mozambique
  • Assumptions – pricing:
  • Rutile price US$1,484/t – average over the life of mine
  • Graphite – US$1,290/t – average over the life of mine
  • Taxes & Royalties:  Corporate Tax Rate 30%, Rent Resource Tax (RRT) 15% after-profits

Royalty: 5% of gross revenue to the Malawi government, 2% of gross profit to the original vendor, 0.45% of gross revenue Community Development

  • Resource:  Rutile: Kasiya is the world’s largest rutile deposit and holds 18mt (1.8bnt @ 1.01%) of contained rutile on its JORC resource estimate.
    • Maiden Probable Ore Reserves: 538mt grading 1.03% rutile and 1.66% graphite for 8.9mt of contained graphite on ~30% of the total mineral resource
    • This is 10mt tonnes larger than Sierra Rutile’s Sembehun resource in Sierra Leone and 17.3mt larger than that at Base Resources’ Kwale mine in Kenya, the latter set to close in December 2024.
    • Drilling was done on a 100m x 100m grid using push tube and aircore. All the material sampled in the Kasiya basin comes from same origin
    • Graphite: the graphite is interleaved with the rutile in sedimentary layers which may be distinctly mined. The project hosts one of the largest graphite resources and if you consider the graphite to be a by-product should have the world’s lowest operating cost assuming consistency across the deposit.
  • Cash: Sovereign Metals has around A$45m cash at hand as of end-August.
  • Rio Tinto invested A$40.4m for a 15% interest in Sovereign Metals.

“Rio Tinto will provide assistance and advice on technical and marketing aspects of Kasiya including with respect to Sovereign’s graphite co-product, with a primary focus on spherical purified graphite for the lithium-ion battery anode market.”

  • Observations: Sovereigns PFS study is early stage in its nature with -20% to +25% variation assumed from the next stage Feasibility Study and hopefully mine-building reality. Operating costs are also supposed to be within +/-20%.
  • The revenue to cost ratio ranks ahead of other developed ilmenite/zircon/rutile projects in Kenya, Western Australia and Sierra Leone.
  • Rutile pricing:  Rutile at US$1,484/t looks conservative compared with the Asian Metals price of $1,915/t today
    • The rutile has been tested and checked for problematic impurities at ALS in Perth and by three potential offtakers. The material is shown to be suitable for Chloride and Sulphate plants.
  • Graphite pricing: Management have used a conservative view vs the average peer group assumed price at ~$1,600/t given the flake size distribution.
  • Recovery rates:  Sovereign’s 100% Rutile recovery rate sounds unusual but is supported by its reconciliation in sample testing which effectively shows higher grades than are reported in the resource. Graphite recoveries of 67.5% are lower as graphite is lost in favour of Rutile recovery. There is definitely room for improvement here.
  • Transport: A short rail spur will connect the Kasiya mine to the Nacala railway which runs downhill to the deep-water port of Nacala in Mozambique
  • Optimisation: There is significant scope for optimisation of the mine and mining process with the sequencing of proposed open pits and fine tuning of the magnetic separation plant for rutile and in the recovery of graphite though its processing.
  • Takeover potential:   We see a strong opportunity for Sovereign to be taken over by a major player in the mineral sands space.
    • Our view is that a reasonable takeover offer come in at a significant proportion of the projects estimated value given the ‘world-class’ nature of the mineral resource and potential to add value through further optimisation of the production process.
  • Valuation:   Taking 33% of the NPV@10% gives £331m. Dividing this by the fully diluted number of shares and options gives a value of 55p/s.
  • Recommendation:  We recommend Sovereign Metals as a Strong Buy due to the significant difference in value between its shares and the NPV@10%.
  • While our valuation only takes 33% of the NPV@10% value we see potential for further upside as details on mining and processing are firmed up.

Conclusion:  Kasiya is a rare and unusual ‘World Class’ titanium mineral deposit in a world where Rutile is scarce and highly prised as a feedstock mineral.

Rio Tinto’s A$40.4m financing follows nine months of examination and due diligence indicating potential for greater involvement going forward.

While it is possible another mineral sands producer might look to join in the financing we suspect Rio Tinto may ultimately seek to control mine and have an option to become operator of the mine within 180 days of publication of the DFS.

*SP Angel act as Nomad and broker to Sovereign Metals.  

Strategic Minerals* (SML LN) 0.15p, Mkt Cap £3.0m – Cobre maintains profitability despite dip in US economic growth

  • In its interim report for the six months to 30th June, Strategic Minerals reports an unaudited pre-tax profit of US$54,000 (2022 – US$248,000 profit) and a closing cash balance of US$129,000.
  • The company notes that it remains profitable “despite reduced sales in the period” which saw sales from its Cobre magnetite operation in New Mexico dip to 4,162t during the June quarter (2022 – 10,711t) realising US$367,000 revenue (2022 – US$666,000).
  • Strategic Minerals’ Managing Director, John Peters explained that “the dip in US economic growth , … [had an] … impact on Cobre sales , … [causing the company to maintain] … a tight control on overheads” which declined to US$457,000 in H1 2023 (H1 2022 – US$637,000).
  • Mr. Peters confirmed that Strategic Minerals “is looking to source short term funding to ensure adequate cash balances are available for planned operations, thus avoiding unnecessary dilution”.
  • Chairman, Alan Broome confirmed Strategic Minerals’ success in “reducing overheads by 13% in the first half of the year … [and said that] … in acknowledging the need to maintain prudent cash flow, the Company is seeking short-term debt financing.
  • Mr. Broome reported that the company had received a “particularly positive” response to its efforts to secure strategic investors (Joint venture/purchasers) … in relation …  [to the tin / tungsten project at] … Redmoor” in Cornwall where “an interested party …  [is] … currently accessing the CRL data room.
  • At the Leigh Creek copper project in South Australia, Strategic Minerals is working with two unrelated parties who have expressed an interest in the sulphide exploration potential of the project.
  • Also at Leigh Creek, the company has “recently been approached by a party that is proposing an alternative approach to treating the copper oxide and we are currently investigating the feasibility of this approach.

Conclusion: Strategic Minerals continues to be profitable at Cobre and is securing third party interest for its Redmoor tin/tungsten project in Corneall and its Leigh Creek copper project in South Australia.

*SP Angel acts as Nomad and Broker to Strategic Minerals

Wishbone Gold* (WSBN LN) – 2.15p, Mkt Cap £5.6m – Interim results highlight drilling at the Red Setter and Cottesloe projects, WA

See link for recent note: CLICK FOR PDF

  • Yesterday afternoon, Wishbone Gold reported its unaudited interim results for the six months to 30th June.
  • The company reports a loss of £0.67m (2022 – £0.39m loss) and a 30th June cash balance of £0.43m.
  • The Wishbone Gold announcement also highlights that the “£1.4 million financing in early August has significantly improved the company’s cash position providing funding for exploration and operations”.
  • Operationally, yesterday’s announcement highlights the expansion of the licence holding on the Cottesloe project in the Paterson Region of WA to 165km2 and where drilling following up geophysical studies was completed recently.
  • The company also confirms the identification, based on geophysics, of two target areas in its Red Setter project area, also in the Paterson Region, where a geological setting analogous to the nearby Telfer gold mine is indicated by geophysical interpretation.

*SP Angel acts as a Broker for Wishbone Gold

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


John Meyer – John.Meyer@spangel.co.uk – 0203 470 0490

Simon Beardsmore – Simon.Beardsmore@spangel.co.uk – 0203 470 0484

Sergey Raevskiy –Sergey.Raevskiy@spangel.co.uk – 0203 470 0474


Richard Parlons –Richard.Parlons@spangel.co.uk – 0203 470 0472

Abigail Wayne – Abigail.Wayne@spangel.co.uk – 0203 470 0534

Rob Rees – Rob.Rees@spangel.co.uk – 0203 470 0535

Grant Barker – Grant.Barker@spangel.co.uk – 0203 470 0471

SP Angel                                                            

Prince Frederick House

35-39 Maddox Street London

*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


This note is a marketing communication and comprises non-independent research. This means it has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of its dissemination.

This note is intended only for distribution to Professional Clients and Eligible Counterparties as defined under the rules of the Financial Conduct Authority and is not directed at Retail Clients.

This note is confidential and is being supplied to you solely for your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published in whole or in part, for any purpose.

This note has been issued by SP Angel Corporate Finance LLP (‘SPA’) to promote its investment services. Neither the information nor the opinions expressed herein constitutes, or is to be construed as, an offer or invitation or other solicitation or recommendation to buy or sell investments. The information contained herein is based on sources which we believe to be reliable, but we do not represent that it is wholly accurate or complete. All opinions and estimates included in this report are subject to change without notice. It is not investment advice and does not take into account the investment objectives and policies, financial position or portfolio composition of any recipient. SPA is not responsible for any errors or omissions or for the results obtained from the use of such information. Where the subject of the research is a client company of SPA we may have shown a draft of the research (or parts of it) to the company prior to publication to check factual accuracy, soundness of assumptions etc.

Distribution of this note does not imply distribution of future notes covering the same issuers, companies or subject matter.

Where the investment is traded on AIM it should be noted that liquidity may be lower and price movements more volatile.

SPA, its partners, officers and/or employees may own or have positions in any investment(s) mentioned herein or related thereto and may, from time to time add to, or dispose of, any such investment(s).

SPA is registered in England and Wales with company number OC317049.  The registered office address is Prince Frederick House, 35-39 Maddox Street, London W1S 2PP.  SPA is authorised and regulated by the UK Financial Conduct Authority and is a Member of the London Stock Exchange plc.

MiFID II – Based on our analysis we have concluded that this note may be received free of charge by any person subject to the new MiFID II rules on research unbundling pursuant to the exemptions within Article 12(3) of the MiFID II Delegated Directive and FCA COBS Rule 2.3A.19.

A full analysis is available on our website here http://www.spangel.co.uk/legal-and-regulatory-notices.html. If you have any queries, feel free to contact our Compliance Officer, Tim Jenkins (tim.jenkins@spangel.co.uk).

SPA research ratings – Based on a time horizon of 12 months: Buy = Expected return of more than 15%, Hold = Expected return between -15% and +15%, Sell = Expected return of less than 15%

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