US Steel production rises as India takes up China’s surplus
MiFID II exempt information – see disclaimer below
Adriatic Metals (ADT1 LN) – Quarterly activities
Aura Energy* (AURA LN) – Andrew Grove takes over as managing director as David Woodall steps away
Base Resources (BSE LN) – Quarterly activities as mineral sands prices slide
Bushveld Minerals* (BMN LN) – Resignation of Finance Director
Caledonia Mining (CMCL LN) – Deep drilling shows depth extensions to the mineralisation at Blanket
Castillo Copper (CCZ LN) – Focus on northwest Queensland exploration projects as management changes continue
Galileo Resources (GLR LN) – Identification of exploration targets in the Kalahari Copperbelt, Botswana
Great Western Mining* (GWMO LN) – FLASH NOTE – Porphyry target shows high-grade copper, silver, and gold
KEFI Gold and Copper* (KEFI LN) – Asfingia gold discovery at Jibal Qutman, Saudi Arabia
Oriole Resources* (ORR LN) – FLASH NOTE – Oriole receives US$0.5m as signature payment from BCM for Mbe gold project
Savannah Resources* (SAV LN) – BUY, 21.1p – Project and independent legal review update
Iron ore holds steady as Vale beats guidance and China concerns mount as optimism fades
- Iron ore prices are continuing to hold steady around the $135/t mark for the 62% Fe benchmark.
- Vale saw iron ore production rise to a five year high for the quarter, following a CAPEX roll out to boost performance at aging mines.
- Despite this, prices are holding around three month highs.
- Rio Tinto remains optimistic of a China rebound, however Evergrande’s default yesterday and a fading stock market rally are fuelling concerns that the PBoC’s recent stimulus was not sufficient.
US Steel production rises as India take up China surplus
- US Steel production rose to 1,697,000t last week on 1,682,000mt the week before on a utilisation rate of 75.7% for the week ending 20th January according to the American Steel Institute.
- Steel production in China is growing, with domestic pig iron capacity and crude steel capacity both growing in 2023.
- China steelmakers are expected to bring in 82.2mt/yr of additional pig iron capacity in 2024 and 114mt/yr of additional crude steel capacity over 2024.
- However, China steel output hit a six year low last month, falling 15% yoy as steel margins remain thin/negative on high iron ore prices and weak downstream demand.
- Analysts suggest steel producers are avoiding shutting capacity over fear of losing market share and being hit by care and maintenance costs.
- Mills are also likely under reporting output given various government sanctions introduced to reduce industry footprint.
- EAF capacity is also seen to grow in 2024, expanding by 21mt/yr to 220m/t by year end, standing at 17.6% of total crude steel capacity. (S&P Global)
- Crude steel production from Jan 11th to 20th was at 20.94m tons, +3.7% MoM and +8.15% YoY, which is the highest daily production since mid Sep 2023, according to data from CISA
- Zhengzhou is offering a 50m yuan cash rebate for local car purchases by Feb 29th, aiming to stimulate holiday spending.
- The World Steel Association expects global steel demand to increase by 1.9% to 1.85bnt in 2024, with Southeast Asia and India driving the demand growth.
- Indian steel demand is expected to grow by 10& in the medium term, whilst JSW steel expects demand to jump 15% to 135mt yoy.
- The major Indian steel producer expects Indian demand to climb to 200-210mt by 2030.
- 39mt is expected to be added in new capacity by March 2027 in India. (ICRA).
- Analysts expect China steel exports to remain elevated through 2024, potentially growing beyond 2023 levels as China domestic demand remains weak on property downturn.
- China’s property sector has long accounted for c.30% of domestic steel demand.
- Green steel investment continues to accelerate, with steel decarbonisation projects tracked by BloombergNEF rising to 66, up for a third straight year.
Copper – Mine disruptions and missed targets indicate developing deficit
- A surplus of copper through 2023 surprised much of the market as European consumption and manufacturing slowed beyond expectations.
- Many mines which had a generally good year are now suffering from stoppages in Panama, Indonesia, Peru and the difficulty of meeting expectations in Chile.
- Electric Vehicle production continues to ramp up with China selling increasing numbers of EV into Asia
Iran – Geopolitical risk heats up as Biden toughens talk on Iranian-sponsored attacks in Jordan and the Red Sea
- The US is losing the little patience it had left with Iran and sounds increasingly hostile in its rhetoric.
- Israel is cleaning up Hamas fighters in Gaza and may also make a pre-emptive strike to destabilise Iran before its nemesis acquires nuclear weapons.
- Iran has already attacked Pakistan and US personnel in Syrah, Jordan and the Red Sea.
- Putin is no-doubt stirring up trouble across the axis-of-evil but may well get more than he bargains for if the US retaliates.
- Iran is goading liberal-minded Biden into action, perhaps at Putin’s behest. But Biden is also at an age where he might prefer to right a few wrongs.
- Gulf War Mk III looks like it is on the way but this time with possible support from Saudi Arabia and some other Sunni nations.
- Iranian Ayatollah’s deposed the Shah of Iran, the King of Kings and look like a threat to the Kingdom’s of most other Arab nations.
- Iran has developed an extensive network of militants but is now arming them with sophisticated drones and guided missiles.
- If the US does not strike now then it may lose the ability to prevent Iran taking over much of the Middle East while it is forced to watch from the sidelines.
- We are reminded of the saying “if you want peace, prepare for war”
- We are also reminded that one of the better ways to starve the Russian and Iranian regimes of cash is to avoid buying diesel or gasoline, so go ahead buy an EV and help deny the funds used to make the drones and missiles being fired into Ukraine and the Red sea.
Peru – Poderosa mine attacked again by illegal miners following fatal invasion in December
- In Peru, illegal, artisanal miners have destroyed a high-voltage tower serving the Poderosa gold mine highlighting a new form of disruptive protest (Mining.com)
- In December a more militant group using explosives raided the Poderosa mine killing seven security guards, three mining operators and injuring another 15.
- The police later regained control of the mine, seizing weapons and capturing seven suspects.
- The mine produces some 303,138oz of gold 191,898oz silver in 2022.
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| HK Hang Seng | -2.32% | at | 15,703 | |
| Shanghai Composite | -1.83% | at | 2,831 |
Economics
US – Dallas Fed Manufacturing Business Index 27.4 vs -10.4 expected
China – Evergrande – Could China be about to suffers its Lehman Bros moment as judge orders Evergrande liquidation
- The collapse of Evergrande is not new news but the order for liquidation now sets in train a process to sell off assets to repay creditors
- The group is reported to have $240bn of assets and significant debt which is due with $300m worth in the short term
- An analyst at Deloitte estimated a 3.4% recovery on debt in Evergrande if the company was liquidated.
- Little impact on construction projects is expected in the short term as it will take time for liquidators to be appointed.
ECB – Peter Kazimir indicates June is more probable than April for a first rate cut
- Mario Centeno is looking to start more gradual rate cuts sooner as inflation falls towards 2%
- ECB Vice President Luis de Guindos remains cautiously optimistic but much depends on the data.
- Why do we have this funny feeling the data is not going to do what the ECB committee is looking for?
Spain – Q4 unemployment falls to 11.76% from 11.84% in Q2 adding 783,000 new jobs last year (Spanish National Statistics Institute)
Germany – Expect recession as economy slows on multiple fronts
- Ifo Institute forecasts GDP by -0.2% as economy continues to contract on:
- Higher energy prices.
- Slowing demand for most products
- Weakening sales of Diesel vehicles where German industry was particularly strong
- Difficult transition to Electric Vehicles
- Possible lack of critical raw materials to meet EU regulations on European content
- Slower construction sector and cancelled contracts
- Higher interest rates slowing the economy and residential construction
- Rising levels of illness
- Rail strikes
- Unusually cold January with some disruption with snow
UK – Mortgage Approvals: 50.46k vs 52.5k expected and 49.3k previous
- Mortgage lending: 0.83bn vs 0.25bn expected and 0.01bn previous
- Net lending to individuals: 0.4bn vs 1.5bn expected and 2.1bn previous
- BRC Shop Price Index – 2.9% increase yoy vs 4.3% previous
Currencies
US$1.0817/eur vs 1.0836/eur previous. Yen 147.51/$ vs 147.84/$. SAr 18.864/$ vs 18.788/$. $1.269/gbp vs $1.271/gbp. 0.660/aud vs 0.660/aud. CNY 7.178/$ vs 7.180/$.
Dollar Index 103.54 vs 103.52 previous.
Commodity News
Precious metals:
Gold US$2,038/oz vs US$2,031/oz previous
Gold ETFs 84.1moz vs 84.2moz previous
Platinum US$931/oz vs US$916/oz previous
Palladium US$990/oz vs US$950/oz previous
Silver US$23.18/oz vs US$23/oz previous
Rhodium US$4,450/oz vs US$4,500/oz previous
Base metals:
Copper US$ 8,577/t vs US$8,506/t previous
Aluminium US$ 2,256/t vs US$2,256/t previous
Nickel US$ 16,380/t vs US$16,545/t previous
Zinc US$ 2,565/t vs US$2,563/t previous
Lead US$ 2,175/t vs US$2,163/t previous
Tin US$ 26,220/t vs US$26,675/t previous
Energy:
Oil US$82.4/bbl vs US$84.0/bbl previous
- Saudi Aramco announced it has been directed by the Ministry of Energy to maintain its maximum sustainable capacity at 12mmb/d, and not to continue increasing to 13mmb/d.
- Media reports that the US will allow a six-month suspension on Venezuelan sanctions to expire in April if opposition candidate María Corina Machado is barred from running.
Natural Gas €27.6/MWh vs €28.4/MWh previous
- The new US natural gas contract for March delivery has opened near $2/mmBtu, with weather forecasts for warmer than expected February temperatures and the month-long outage of a Freeport LNG export train.
Uranium Futures $99.7/lb vs $99.8/lb previous
Bulk:
Iron Ore 62% Fe Spot (cfr Tianjin) US$135.2/t vs US$135.2/t
Chinese steel rebar 25mm US$572.6/t vs US$572.3/t
Thermal coal (1st year forward cif ARA) US$96.0/t vs US$94.5/t
Thermal coal swap Australia FOB US$116.8/t vs US$119.0/t
Coking coal swap Australia FOB US$324.0/t vs US$324.0/t
Other:
Cobalt LME 3m US$29,135/t vs US$29,135/t
NdPr Rare Earth Oxide (China) US$55,587/t vs US$55,569/t
Lithium carbonate 99% (China) US$12,051/t vs US$12,047/t
China Spodumene Li2O 6%min CIF US$1,000/t vs US$1,000/t
Ferro-Manganese European Mn78% min US$1,055/t vs US$1,057/t
China Tungsten APT 88.5% FOB US$305/mtu vs US$305/mtu
China Graphite Flake -194 FOB US$590/t vs US$590/t
Europe Vanadium Pentoxide 98% 5.8/lb vs US$5.8/lb
Europe Ferro-Vanadium 80% 29.05/kg vs US$29.05/kg
China Ilmenite Concentrate TiO2 US$317/t vs US$317/t
Spot CO2 Emissions EUA Price US$67.2/t vs US$67.6/t
Brazil Potash CFR Granular Spot US$292.5/t vs US$292.5/t
Battery News
China energy storage capacity increases four-fold in 2023
- According to the National Energy Administration (NEA), China’s installed energy storage capacity reached 31.4GW by end 2023.
- 22.6GW of capacity was installed across the year, almost four times the capacity in 2022.
- Lithium-ion batteries accounted for 97.4% of the energy storage capacity.
- The NEA said in July that China was introducing more flexible power transmission arrangements to its national grid to avoid a repeat of the power cuts that badly affected parts of the country in 2022.
Prologium inaugurates first solid-state ceramic battery gigafactory
- The Taiwanese battery maker unveiled its first 106Ah solid-state battery, manufactured with a high-silicon anode.
- Prologium believes that its manufacturing technology can be the gateway to commercial viability of next-gen batteries.
- The factory has a planned 2GWh annual capacity and will serve as the blueprint for the 48GWh plant that has been granted approval in Dunkirk, France.
- France has included Prologium in the ‘France 2030’ industrial plan, along with the approval of its €5.2bn plant.
- The production line in Taiwan is expected to start supplying EV manufacturers this year.
Indian Government reopens bids for 10GWh battery cell scheme
- The government will retender its ambitious scheme targeting 10GWh of battery production in a move to bolster domestic manufacture of advanced battery cells.
- The Production Linked Incentive (PLI) scheme which was introduced to attract investments and promote local manufacture of batteries for EVs and battery energy storage.
- This decision to retender the scheme signifies India’s commitment to creating a robust ecosystem for battery manufacturing within the country.
Origin Energy to build 650MWh BESS at site of its main gas generator.
- The energy utility will spend $400m on a new big 650MWh big battery to be built at the site of its main gas generator in Victoria.
- Origin’s decision to build the battery at the site of its existing gas fired power station follows a pattern where big utilities are adding storage to their existing fossil fuel facilities, mostly to benefit from the energy infrastructure such as sub-stations and power lines.
- Origin has chosen US-based energy storage systems supplier Fluence to build the project.
- Site preparation is expected to begin in a couple of months and the battery will begin operating in late 2026.
Tesla sees record energy storage capacity installed in 2023
- Tesla deployed 14.72GWh of battery energy storage globally in 2023, doubling the 6.5GWh of battery storage deployments reported in 2022.
- 2023 capacity additions were more than the combined figures for 2022, 2021, and 2020.
Company News
Adriatic Metals (ADT1 LN) 183p, Mkt cap £557m – Quarterly activities
- Adriatic provides a quarterly update for the period to 31st December 2023.
- The Company expects the Vares Processing Plant to now produce first concentrate in 1Q24.
- Key infrastructure has been completed, and staff headcount up to 296 alongside 329 contractors.
- Rupice ore reserve estimate now stands at 13.8mt at 187g/t Ag, 5.2% Zn, 3.3% Pb, 1.4g/t Au, 0.5% Cu, 0.2% Sb.
- LOM now extended to 18 years at nominal throughput capacity of 800ktpa.
- Updated MRE expected 1H24.
- CAPEX final estimate increased to $189m, cash at year end stood at $44.8m, delayed Orion Mine Finance repayments to 30th December 2024.
- Expected to be fully funded for ramp up and plant completion.
*An SP Angel mining analyst has visited Adriatic Metals operations in Bosnia
Aura Energy* (AURA LN) 12.5p, Mkt Cap £78m – Andrew Grove takes over as managing director as David Woodall steps away
(Aura holds 85% of the Tiris Uranium Project, Mauritania with 15% held by ANARPAM, a Mauritanian Government entity.)
- Aura Energy has appointed Andrew Grove as Managing Director & CEO following the resignation of the former incumbent, David Woodall.
- Mr. Grove is described as having “over 30 years of managerial, technical, commercial and finance experience” including “14 years at Macquarie Bank as Division Director – Mining Finance and Risk Management … [and most recently as] … Managing Director at Chesser Resources Limited which was developing the Diamba Sud Gold Project in Senegal”.
- Thanking Mr. Woodall for his “for his work and dedication during his time at Aura” Chairman, Phil Mitchell, welcomed Mr. Grove whose “extensive West African mining, finance and corporate experience will be invaluable in developing the Tiris Uranium Project into a commercial scale uranium mine”.
- In a separate release today of its quarterly report for the 3 months ending 31st December, Aura Energy highlights the, previously announced, start of additional drilling at its Tiris uranium project in Mauritania aimed at increasing the existing, February 2023, mineral resource base of 113mt at an average grade of 236ppm U3O8 containing 58.9mlbs of U3O8 through exploration of “seven new exploration targets and estimated further resource potential of between 8 – 32 Mlbs U3O8 from extensions to the existing Mineral Resources”.
- The company confirms that “Front End Engineering Design (“FEED”) studies for the Tiris Uranium Project are well advanced and should be completed Q1 2024 and will be the next step in delivering a commercial scaled low cost ~2 Mlbs/pa uranium mine at Tiris”.
- The company also highlights the “adoption by the Swedish parliament of a new energy target, changing from “100% renewable” to “100% fossil-free” electricity, is an important part of the transition towards the use of nuclear power and uranium mining in Sweden” which increases its confidence in “the substantial economic potential … [of its] … Häggån Project” in Sweden.
- Häggån is a multi metal deposit located in central Sweden containing an ‘Indicated & Inferred’ Resource of “2.35Bt @ 155ppm U3O8” with ~0.3% vanadium pentoxide, ~210 ppm molybdenum, ~340 ppm nickel, ~465 ppm zinc and around 4% K2O. Over 90% of the resource tonnage is currently classed as ‘Inferred’ although the company has previously described a higher grade core to the deposit.
Conclusion: Aura Energy has new leadership at the CEO/Managing Director level as it presses ahead with drilling to expand the resource base at Tiris and progresses the FEED study while advancing its Swedish project at Häggån.
*SP Angel acts as Nomad and Broker to Aura Energy
Base Resources (BSE LN) 8.25p, Mkt cap £97m – Quarterly activities as mineral sands prices slide
- Base reports their operational update for the quarter to December 31st 2023.
- 3.9mt mined in December quarter, down from 4.1m mined in the September quarter.
- 38.9kt ilmenite produced, up by 100t over the quarter.
- 9.3kt rutile produced vs 9.6kt produced previous quarter.
- Sales revenue for the quarter at $589/t ($1,029/t previous quarter) vs costs of $306/t.
- Lower operating costs explained by lower unit power costs, lower unit flocculant costs and lower unit maintenance costs.
- Unit revenue lower on increased ilmenite sales.
- Mining at Kwale is expected to end in December this year.
- Cash balance at the end period stood at $78.9m with no debt.
- Toliara Monazite PFS reported over the period, showing post-tax NPV10 of $1bn, IRR of 79%, boosted by the Mineral Sands DFS2, NPV10 is boosted to US$2bn over a 38yr LOM.
- Progressing of the Toliara Project has been delayed as the Government works towards a new Mining Code.
Bushveld Minerals* (BMN LN) 1.2p, Mkt Cap £24m – Resignation of Finance Director
- The Company completed its investigation in respect of the Finance Director (Tany Chikanza) and a potential conflict of interest.
- Following investigation, both parties agreed to terminate the contract with Ms Chikanza’s leaving the Company on 31 January 2024.
*SP Angel act as nomad and broker to Bushveld Minerals
Caledonia Mining (CMCL LN) 880p, Mkt Cap £169m – Deep drilling shows depth extensions to the mineralisation at Blanket
- Caledonia Mining reports that drilling underground at its Blanket mine in Zimbabwe has shown that the Eroica and Blanket orebodies extend to at least 1,110m below surface offering potential for resource expansion to extend the mine’s life.
- The company drilled a total of 13,280m during 2023 with drilling of the Blanket and Eroica orebodies from the 750m level intersecting the zones down to “1,110 metres below surface, the lowest level of main infrastructure being developed from Central Shaft … [and drilling] … from 930 metres below surface at Blanket and from 1,110 metres below surface on AR South have intersected the orebodies below 1,110 metres, which is encouraging for Blanket’s longer-term development”.
- Among the intersections highlighted in today’s announcement, which are to be incorporated in a revision to the mine’s mineral resources estimate (MRE) during Q2, are:
-
- A 5.80m wide intersection of the Eroica ERCN Footwall structure (4.95m true width) at an average grade of 4.95g/t gold from a depth of 350.00m (1,108.4m below surface) in hole ERC750-EX23-08; and
- A 24.60m wide intersection of the BQR Hangingwall structure (13.33m true width) at an average grade of 5.92g/t gold from a depth of 173.03m (1,130.63m below surface) in hole BLK930-EX23-08; and
- A 36.00m wide intersection of the BLK2 Hangingwall structure (16.31m true width) at an average grade of 6.12g/t gold from a depth of 181.30m (1,147.30m below surface) in hole BLK930-EX23-10; and
- A 10.80m wide intersection of the BLK4-5 structure (4.27m true width) at an average grade of 8.80g/t gold from a depth of 28.60m (909.40m below surface) in hole BLK870-EX23-03; and
- A 15.00m wide intersection of the BQR structure (8.22m true width) at an average grade of 3.62g/t gold from a depth of 3.00m (1,128m below surface )in hole ARS1110-EX23-04; and
- The company explains that “drilling from June 2023 to end of December 2023 indicates that the existing Blanket and Eroica ore bodies have grades and widths which are generally better than expected”.
- Commenting on the results, CEO, Mark Learmonth, said that Caledonia Mining anticipates that “the positive grades and widths will result in an increased overall resource, which in due course should result in the extension of the existing life of the mine”.
- Investment in the mine over the last seven years extended the mine’s life into the 2030s and the forthcoming revision to mineral resources, which will be accompanied by a “revised life of mine plan … [is expected to ] … result in the existing life of mine being extended, rather than an increase in the target annual production rate”.
- The 31st December 2021 mineral resource estimate for the mine shows a ‘Measured & Indicated’ resource of 2.14mt at an average grade of 2.77g/t gold for 190koz of contained gold with an additional ‘Inferred’ resource of 5.4mt at an average grade of 3.17g/t containing 550koz.
- The revision is expected to upgrade a portion of the current inferred resource “to measured or indicated mineral resources together with the addition of new inferred mineral resources”.
Conclusion: The life of the refurbished Blanket gold mine is likely to be extended with deep drilling encountering better than expected grades and widths which are expected to increase the mine’s resource base when the company delivers a revised MRE and life of mine plan later this year
*SP Angel mining analysts have visited Caledonia’s mining operations in Zimbabwe
Castillo Copper (CCZ LN) 0.33p, Mkt Cap £4.2m – Focus on northwest Queensland exploration projects as management changes continue
- In its quarterly report for the 3 months to 31st December 2023 Castillo Copper confirms that it has now completed the strategic review of its assets, which followed management changes last year.
- Management changes continue with the news that “former Managing Director Dr Dennis Jensen tendered his resignation during the Quarter … [and that] … Mr Jack Sedgwick … transitioned from interim Executive Director to Non-Executive Director”.
- Reiterating a statement issued in October last year, the review confirmed the assets in northwest Queensland as “core” and said that improving the “geological understanding of the 20+ prospects is now a Board focus, in readiness of engaging potential strategic partners”.
- Today’s announcement does not comment on the current Board’s view on the Zambian assets which had previously been discussed as one of the company’s main areas of interest.
Galileo Resources (GLR LN) 1.08p, Mkt Cap £12.5m – Identification of exploration targets in the Kalahari Copperbelt, Botswana
- Galileo Resources reports that a recent geochemical survey has identified “three strong copper targets” on its wholly-owned exploration licence in the Kalahari Copperbelt in Botswana.
- The company says that its targets cover “a combined strike length of more than 6km … [and seem to be] … contiguous and associated with the same geological and structural features” seen in the adjacent licences held by ASX listed Cobre Limited.
- The nearby Cobre licences suggest the possibility of “a fourth possible target area … to the north of the recent discoveries and along strike of Cobre’s Tlou target”.
- Commenting on the geochemical results, Chairman and CEO, Colin Bird, said that “we look forward to drilling these targets in the near-term”.
Conclusion: The Kalahari Copperbelt is gaining increasing recognition as companies such as Sandfire Resources moves ahead with development of its 3.2mtpa Mothae open pit mine and Khoemacau Copper progresses it’s Zone 5 underground mine at Boseto. Early stage geochemical results in the area and close to other exploration projects is encouraging and we look forward to further news on Galileo Resources’ exploration plans.
Great Western Mining* (GWMO LN) 0.07p, Mkt Cap £3.8m – FLASH NOTE – Porphyry target shows high-grade copper, silver, and gold
- Today Great Western reports the results of a recent early-stage exploration programme at the West Huntoon licence block.
- The Company’s exploration team has taken ten grab samples from the West Huntoon claims in a selective fashion, targeting areas of highly oxidised copper mineralisation around the granites.
- Copper results taken from both quartz breccia and granite yielded results of:
- 5.82% Cu, 3.82% Cu, 4.85% Cu, 1.56% Cu.
- Gold results included highlights of:
- 7.3g/t Au, 5.5g/t Au, 4.5g/t Au.
- Silver results yielded highlights of:
- 2,438g/t Ag, 843g/t Ag, 108g/t Ag, 102g/t Ag, 79g/t Ag
- Molybdenum results yielded highlights of:
- 442g/t Mo, 140g/t Mo.
- The area has evidence of historic mining where artisanal workings targeted high-grade mineralised veins. The majority of these samples were not taken from the historic workings.
- As announced in November, Yerington porphyry expert Dr Lawrence Carter had visited the West Huntoon licence package in the Autumn and identified the prospective nature of the licence package for copper porphyry-style mineralisation.
- Dr Carter’s report highlighted the strong indications of a magmatic-hydrothermal system over the claim block, with the potential for a sub-cropping porphyry system unidentified to date given the tertiary volcanic cover.
- These assays support Dr Carter’s expectations, with the newly mapped granites hosting high-grade copper, gold, and silver in oxidised granites.
- Precious metals are expected to be hosted within discrete epithermal veins over the area, further adding to the claim block’s potential.
- The elevated molybdenum shown over two samples further supports the geologist’s hopes of more widespread porphyry-style mineralisation.
- Given the elevated copper, gold and silver results at West Huntoon, Great Western is now looking to accelerate towards drilling at the claim block.
- The recently announced deal with Crowne Point enables GWM accelerate a drilling programme given the pads can be positioned on private land.
- To further shore up targets for drilling, GWM will complete a thorough, non-selective grid this year to advance exploration of the West Huntoon granite and vein zones.
Conclusion: These are highly encouraging initial rock chip sampling assay results from the newly prioritised West Huntoon claim in Mineral County, Nevada. Great Western will now look to complete non-selective soil sampling over a grid to further delineate drilling targets at the prospect. Drilling will be expedited by the recent agreement with local party Crowne Point, with the GWM team able to utilise private land for drilling. The high-grade silver and gold readings highlight the target’s precious metal potential, whilst the elevated copper grades support the local porphyry expert’s excitement over a possible mineralised copper-porphyry system hosted below the tertiary volcanic cover. The West Huntoon claim block now presents itself as Great Western’s most exciting exploration prospect and we look forward to future updates, alongside the start of processing at the precious metal milling JV currently awaiting final permitting.
*SP Angel act as Broker to Great Western Mining, an SP Angel Analyst has visited Great Western’s Nevada claim blocks.
KEFI Gold and Copper* (KEFI LN) 0.6p, Mkt Cap £.31m – Asfingia gold discovery at Jibal Qutman, Saudi Arabia
- The Company released drilling results from a gold discovery of the Asfingia satellite target at the Jibal Qutman Project in Saudi Arabia.
- Selected drilling results include:
- JQD_232: 13.9m (12.7m estimated true width) at 7.9 g/t gold from 53.6m (including 1.2m at 66.6 g/t gold).
- JQD_265: 25.5m (37.5m ETW) at 1.9 g/t gold from 86.0m (including 7.4m at 5.2 g/t gold).
- The mineralisation was identified over a 350m strike length and down to a depth of 75m with the prospect remaining open along strike and at depth.
- Drilling is ongoing to define Asfingia maiden MRE to be included in the larger Jibal Qutman Project.
- The GMCO team representing a JV between ARTAR and KEFI is on the ground carrying a wider systematic exploration effort across three contiguous gold exploration licenses to identify new targets.
- Two diamond drilling rigs and 10 Saudi based exploration geologists are currently engaged at Jibal Qutman with RC rigs are due to arrive at site shortly.
- ARTAR agreed to cover ongoing exploration expenses to keep the momentum while KEFI is in final stages to finalise Tulu Kapi financing.
- Jibal Qutman DFS is targeted in mid-2024 incorporating results from the latest 13,000m infill drilling and metallurgical testwork (80-93% gold recoveries for oxide material and 70% for primary ore)
Conclusion: A gold discovery of Asfingia on the Jibal Qutman license area reflects high potential of the property and is set to expand total resource and ultimately projected life of mine. Exploration effort is supported by a local partner (ARTAR) with drilling rates set to accelerate testing new targets aiming to grow the scale of the project.
*SP Angel acts as Nomad and Broker to KEFI Gold and Copper. The analyst has previously visited the Tulu Kapi gold mine. A SP Angel corporate finance
partner recently attended a meeting of finance partners in Addis Ababa.
Oriole Resources* (ORR LN) 0.38p, Mkt cap £15m – Oriole receives US$0.5m as signature payment from BCM for Mbe gold project
- Oriole Resources report the receipt of US$0.5m from BCM International as part of the US$1m signature payment on their earn-in arrangement for the Mbe gold project in Cameroon.
- Oriole have already received $50,000 leaving $450,000 due from BCM by end February.
- The Oriole team are busy planning their next round of field exploration for the Mbe project with details to be announced shortly.
- Management recently published results from 639 in-situ pit and rock-chip samples over a 3km anomalous gold zone.
- The team identified a shear-related porphyritic unit with highly silicified and gold mineralisation.
- 155 of the samples recorded gold grades equal to or greater than 1g/t Au and 232 samples graded 0.2-0.99g/t Au.
- Including:
- Outcropping rock chip samples: 256g/t Au, 133g/t Au, 75g/t Au, 33g/t Au and 23g/t Au
- Pit sampling: 25g/t Au, 24g/t Au, 10g/t Au and 8.75g/t Au.
- BCM will now hold the right to earn up to 50% in the Mbe project through the expenditure of $4m.
*SP Angel acts as Broker to Oriole Resources
Savannah Resources* (SAV LN) 1.9p, Mkt Cap £36m – Project and independent legal review update
BUY – 21.1p
- The Company updated on Barroso Lithium Project development progress.
- The team reiterated targets for completion of DFS and permitting in H2/24.
- Strategic partner selection process is ongoing with good level of interest from groups along the battery value chain reported and a series carrying due diligence.
- DFS related work is continuing at pace with ~2,500m of RC and DD drilling across 40 holes in the first of two phases completed.
- Drilling is focused on infilling the existing resource and collecting data for geotechnical studies.
- JORC resource updates are expected to be provided deposit by deposit later this quarter.
- Consultants are working on final designs for mining, processing plant and infrastructure.
- Permitting wise, local stakeholder engagement is continuing with the Company hiring Community Relations Manager with a wealth of experience in community mediation.
- The Company expanded its workforce employing from the local community and is holding meetings and presentations with a wide range of local stakeholders to address any questions about the Project.
- Separately, the Company released an update regarding an investigation (Operation Influence) launched by the Portuguese Public Prosecutor’s Office on 7 November 2023.
- The team engaged an independent legal review of its activities since January 2017 up to end of October 2023 in relation to Operational Influencer.
- Results of the review along with additional legal opinions from Portugues legal experts confirmed no improper use of Company money or no evidence of wrongdoing by the Company reaffirming its sold legal standing.
- The review suggested that under no realistic circumstances would the Project’s execution be at risk from the investigation’s findings.
- The team said it had no further engagement with investigative authorities since 7 November 2023.
- The investigation remains ongoing.
Conclusion: DFS and permitting related work continues on site with the team reiterating targets for H2/24 completion while strategic partnership discussions are ongoing with a number of interest parties carrying due diligence. The Company is taking a proactive approach in addressing market concerns over the prosecutor’s office investigation having commissioned an independent legal review of its operations over the last almost seven years that showed strong legal standing of the group.
*SP Angel acts as Nomad and Broker to Savannah Resources
No.1 in Copper: “The winner of the 2020 Fastmarkets Apex contest for copper was the team at SP Angel comprising John Meyer, Sergey Raevskiy and Simon Beardsmore, with an accuracy score of 93.8%”
No1. In Gold: “SP Angel’s trio took the top spot for the gold price prediction throughout the year, with an accuracy score of 97.59%”
The SP Angel team also ranked 1st in Palladium, 3rd in Tin and 5th in Silver in the fourth quarter of 2020
Analysts
John Meyer – 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
Sales
Richard Parlons –Richard.Parlons@spangel.co.uk – 0203 470 0472
Abigail Wayne – Abigail.Wayne@spangel.co.uk – 0203 470 0534
Rob Rees – Rob.Rees@spangel.co.uk – 0203 470 0535
Grant Barker – Grant.Barker@spangel.co.uk – 0203 470 0471
SP Angel
Prince Frederick House
35-39 Maddox Street London
W1S 2PP
*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 |
DISCLAIMER
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.
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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%
