SP Angel Morning View -Today’s Market View, Wednesday 13th November 2024

Gold prices tick higher as focus shifts to CPI following bond sell-off

MiFID II exempt information – see disclaimer below

Atalaya Mining (ATYM LN) – Guidance maintained for 2024 production, costs and capex

Blencowe Resources (BRES LN) – Drilling mobilisation underway in Uganda

Europa Metals Limited (EUZ LN) – Disposal of the Toral project in Spain

Great Western Mining* (GWMO LN) – Sampling results from West Huntoon copper porphyry prospect

KEFI Gold and Copper* (KEFI LN) – Saudi Arabia JV strategic update

Largo (LGO CN) – 3Q24 financial results highlight cost optimisation efforts amid weak vanadium prices

Oriole Resources* (ORR LN) – Issue of options in lieu of cash bonus

Power Metal Resources* (POW LN) – Uranium JV update as drilling planned for 1Q25

Sovereign Metals* (SVML LN) – Sovereign completes mining trials at Kasiya rutile and graphite project in Malawi

Lithium prices extend gains as additional Australian supply comes offline

• Carbonate prices have ticked higher, at $10,400/t in China, whilst spodumene prices are now up $40/t from recent lows to $780/t.
• Prices remain depressed but have been showing signs of life in recent weeks.
• The move follows Liontown’s announcement it plans to slow development of Kathleen Valley.
• Additionally, MinRes announced last night that it was placing Bald Hill on care and maintenance.
• Bald Hill was set to produce 120-145kt this year.
• Mount Marion and Wodgina spodumene mines, in which MinRes holds a 50% interest respectively, have similar FOB costs to Bald Hill.
• Bald Hill marks the fifth project in Australia that has seen output cut/production halted in Australia this year.
• Meanwhile, Rio’s Jadar mine in Serbia continues to face in-country opposition.
• Brazilian spodumene prices currently sit at $800/t CIF China, whilst 6% Zimbabwean prices at $750/t CIF China.

Gold prices ($2,606/oz) tick higher as focus shifts to CPI following bond sell-off

• Gold prices have climbed marginally, having been hit by a sudden slump following Trump’s election.
• This triggered profit taking, with a stronger dollar and higher US Treasury yields also weighing on bullion appetite.
• Focus turns to today’s CPI data, where a hot reading could add pressure to the US bond market and push the dollar higher.
• Speculative money is retreating from gold, with ETF holdings sliding and net long positions being cut.
• Alternatively, the sharp sell-off in Treasuries recently could leave them vulnerable to a reversal on a weaker inflation reading.

Copper – TcRcs to fall below US$50/t and 0.05c/lb with Reuters highlighting expectations of US$20-US$35/t driven by concentrate supply issues

• Expanding smelter production in China is driving strong demand growth though some may pull back on their buying if manufacturers see falling orders.
• We still view expanding EV production along with government projects for new wind, solar and nuclear power as driving demand for copper in China.

Economics

US – Inflation numbers are due later today with estimates for CPI rate to remain unchanged in October.

• Headline and core measures are expected to come in at 0.2%mom and 0.3%mom, respectively, in line with September.
• YoY readings are expected at 2.6% and 3.3% (Sep: 2.4%yoy and 3.3%).
• Markets odds of a 25bp cut in December is currently standing at ~66%, down on pre presidential election results last week.
• Markets are also seen forecasting two rate cuts in 2025, down from three estimated previously and four indicated by the latest FOMC dot plot.

US dollar index strengthens to Dollar Index 106.13 vs 105.75 yesterday following Trump win

• The media seems obsessed with the impact of Trump policies.
• To us, Trump is a ‘dealmaker’ and we reckon the market should ignore the rhetoric and focus on the deals to be done.
• This time round Trump better understands the levers and workings of government.
• This time round the world better understands how to work with Trump.
• Its all about enabling Trump to do deals and look like a hero back home – just like every other political leader but with more noise!

China – China has just bailed out local government to the tune of CNY 10tn but with relatively little impact to its currency

• While many will see this as a zero-sum game, others may be surprised at the scale of the refinancing.
• If the UK government had bailed out our Local Authorities to this extent we reckon Sterling would have taken a ‘Liz Truss’ type hit.
• Fortunately for China, and maybe for the rest of the world, China is able to set its currency within a ‘Managed Floating Exchange Rate Regime’.
• If the Chinese CNY had collapsed Chinese goods would have become even cheaper than they already despite higher CNY metals prices within China.
• While cheaper Chinese goods also export a degree of deflation to the rest of the world the growing divide between Chinese wages in local and US dollar terms maybe cause for concern.
• The prospect of more US Tariffs on Chinese goods is pushing Chinese manufacturers to expand overseas. We can expect transfer pricing issues to emerge.

Car ramming kills 35 as fears for widespread unrest grow (FT)

• An incident outside a sports stadium on Monday in the southern city of Zhuhai is one of a number of apparently random car ramming incidents (FT)
• President Xi has called on the authorities to learn from the incident and to “strengthen at-source risk prevention and control . . . and do our best to protect people’s lives and social stability”.
• Knife attacks are also on the rise with four teachers from a US college knifed in a park.

UK – Food inflation driven by rising supermarket sales

• Supermarket sales rose 2.3% to £11.6bn in October as food inflation combined with preparations for Halloween and Christmas.
• Black Friday sales also started early at some retailers following a similar pattern to ‘Singles Day’ sales in China which were reported to start on 14^th October.
• Shoppers were recorded making 480m shopping trips, a four-year high with four shops a week per household helped by better weather in the latter half of the month.
• Unfortunately, the rise in food inflation combined with the stronger US dollar will not help the Bank of England reduce rates.

Currencies

US$1.0603/eur vs 1.0623/eur previous. Yen 155.19/$ vs 153.91/$. SAr 18.110/$ vs 18.055/$. $1.274/gbp vs $1.280/gbp. 0.652/aud vs 0.654/aud. CNY 7.225/$ vs 7.236/$.

Dollar Index 106.13 vs 105.75 previous

Precious metals:         

Gold US$2,606/oz vs US$2,602/oz previous

Gold ETFs 83.7moz vs 83.5moz previous

Platinum US$948/oz vs US$954/oz previous

Palladium US$950/oz vs US$965/oz previous

Silver US$30.8/oz vs US$30.4/oz previous

Rhodium US$4,675/oz vs US$4,675/oz previous

Base metals:   

Copper US$9,116/t vs US$9,175/t previous

Aluminium US$2,555/t vs US$2,551/t previous

Nickel US$15,915/t vs US$16,080/t previous

Zinc US$2,920/t vs US$2,943/t previous

Lead US$2,013/t vs US$2,025/t previous

Tin US$29,810/t vs US$29,950/t previous

Energy:           

Oil US$71.9/bbl vs US$72.0/bbl previous

Natural Gas €43.2/MWh vs €43.0/MWh previous

Uranium Futures $77.7/lb vs $76.8/lb previous

Bulk:   

Iron Ore 62% Fe Spot (cfr Tianjin) US$100.1/t vs US$100.4/t

Chinese steel rebar 25mm US$515.7/t vs US$517.2/t

HCC FOB Australia US$205.3/t vs US$208.0/t

Thermal coal swap Australia FOB US$144.0/t vs US$143.5/t

Other:  

Cobalt LME 3m US$24,300/t vs US$24,300/t

NdPr Rare Earth Oxide (China) US$58,687/t vs US$58,600/t

Lithium carbonate 99% (China) US$10,381/t vs US$10,089/t

China Spodumene Li2O 6%min CIF US$780/t vs US$770/t

Ferro-Manganese European Mn78% min US$985/t vs US$985/t

China Tungsten APT 88.5% FOB US$343/mtu vs US$340/mtu

China Graphite Flake -194 FOB US$440/t vs US$440/t

Europe Vanadium Pentoxide 98% US$4.8/lb vs US$4.8/lb

Europe Ferro-Vanadium 80% US$25.6/kg vs US$25.55/kg

China Ilmenite Concentrate TiO2 US$309/t vs US$309/t

China Rutile Concentrate 95% TiO2 US$1,156/t vs US$1,154/t

Spot CO2 Emissions EUA Price US$66.6/t vs US$66.6/t

Brazil Potash CFR Granular Spot US$280.0/t vs US$280.0/t

Germanium China 99.99% US$2,865.0/kg vs US$2,875.0/kg

China Gallium 99.99% US$440.0/kg vs US$440.0/kg

Battery News

US installed battery storage reaches 20GW

• The US has installed 20GW of battery storage to the power grid, with 5GW being installed in the first seven months of the year.
• According to the US Energy Information Administration, capacity could double to 40GW by the end of 2025.
• Battery storage has already proven effective in preventing power outages in states like California during extreme heat waves.
• It is unclear exactly how the re-election of Donald Trump will affect plans, but it is definitely not a good thing.
• Trump will likely withdraw the US from the Paris agreement again and it is likely that the $370bn set aside in the Inflation Reduction Act for clean energy support will be scaled back significantly.

Metal thieves targeting EV chargers in spate of thefts in Sheffield

• Council owned EV chargers have been the target of a spate of thefts with thieves targeting cables for scrap metal.
• The city council has said that just two of its 27 council owned chargers were in use following the damage.
• The cost of replacing the cables can run into the hundreds of pounds and is not covered by the council, but it cannot reasonably expect the supplier to replace cables that keep getting stolen.

VW and Rivian launch $5.8bn joint venture

• Rivian Automotive and Volkswagen Group have formally launched their joint venture with a potential $5.8bn deal to bring next-generation electrical architecture and software for both automakers’ electric vehicles based on Rivian’s current technology.
• The two automakers had agreed to develop EVs together with VW expected to invest $5bn.
• The German automaker has boosted its investment by a further $800m, giving Rivian a lifeline that will ease concerns over its cash burn.
• VW are aiming to launch vehicles in 2027 using technology fine-tuned by the JV.
• The companies also aim to develop an all-new software-defined vehicle with more advanced technologies, which they ultimately aim to license to other automakers.

Waymo removes waitlist for autonomous taxi service in Los Angeles

• Waymo, the autonomous ride sharing service has removed the waiting list for rides in Los Angeles, the same step it has made in Phoenix and San Francisco.
• The company secured a record $5.6bn investment round, led by parent company Alphabet.
• Waymo recently announced that it was conducting 150,000 paid trips and driving over 1m miles cumulatively every week.

Company News

Atalaya Mining (ATYM LN) 329p, Mkt Cap £503m – Guidance maintained for 2024 production, costs and capex

• In its Q3 and nine-months year-to-date results Atalaya Mining reports a quarterly profit of €1.49m for the nine months to 30^th September (2023 – €11.14m) bringing the total for the year so far to €17.64m (2023 – €31.45m) and a closing net cash balance of €40.59m.
• The financial results reflect the production of 11,901tonnes of copper during the quarter at a cash cost of US$3.01/lb and an all-in-sustaining cost of US$3.39/lb bringing the year to date total to production of 34,149t of copper in concentrate at a cash cost of US$2.96/lb and an all-in-sustaining cost of US$3.26/lb (2023 – 38,892t at cash cost of US$2.76/lb and an all-in-sustaining cost of US$3.07/lb).
• Average copper grades of the 4.3mt of ore treated during the quarter were 0.33% lower than the equivalent quarter last year (Q3 2023 – 3.9mt at 0.38% copper) reflecting “pit sequencing” however the processed tonnage “represents strong plant performance above nameplate capacity of 15 million tonnes per annum”.
• Atalaya Mining is retaining its current 2024 production guidance while commenting that it “is expected to be at the lower end of the 45,000 – 50,000 tonne guidance range, as previously announced” while costs are “expected to be at the high end of the guidance ranges of $2.80 – 3.00/lb … [on a cash basis] … and $3.00 – 3.20/lb copper payable” on an all-in-sustaining (AISC) basis.
• AISC costs exclude the “one-off investments in the tailings dam and ongoing waste stripping at the San Dionisio area” which are classed as “non-sustaining capital investment … [which is] … expected to be at the low end of the €64 – 73 million guidance range”.
• Operationally, the company confirms that it is continuing waste removal at the San Dionisio deposit in preparation for future mining stripping 3.1mt during the quarter while at “San Antonio, an infill and step-out drilling programme is expected to begin in the coming months”.
• Progress at San Dionisio and San Antonio reflect Atalaya Mining’s strategy to substitute higher grade ore from the San Dionisio deposit for ore from the Cerro Colorado deposit maximising the 15mtpa nominal processing capacity of the plant at Riotinto.
• The company also confirms that its “50 MW solar plant was connected to the substation at the end of October 2024, allowing for phased energy production to begin in the coming weeks“.
• “Once fully operational, the 50 MW solar plant is expected to provide approximately 22% of Riotinto’s current electricity needs, thereby reducing the Company’s carbon footprint”.
• Commenting on the results, CEO, Alberto Lavandeira, welcomed what he described as a “solid” financial performance and said that Atalaya Mining is “pleased with the plant’s strong throughput, which helped to offset lower grades. Absolute costs remained consistent with plans”.
• He also confirmed progress at “Masa Valverde in advance of the potential start of ramp development”.
• Mr. Lavandeira also affirmed the company’s belief “in the fundamentals for copper, given the challenges associated with building large new mines in remote regions around the world”.

Conclusion: Atalaya Mining is delivering strong performance from its 15mtpa plant at Riotinto with over 12mt processed over the first 9 months of 2024.  Progress continues with its strategy to substitute higher grade ore feed from satellite deposits for part of the current Cerro Colorado ore in order to maximise the capacity of the plant.  Solar power is expected to become a key component of the mine’s energy mix following connection of the new 50MW plant at the end of last month.

Blencowe Resources (BRES LN) 3.95p, Mkt Cap £9.9m – Drilling mobilisation underway in Uganda

• Blencowe Resources reports that it has started mobilisation for a 6,700m resource drilling campaign at its Orom Cross graphite deposit in Uganda.
• The company says that the drilling is “the final major workstream required for the completion of the Definitive Feasibility Study” for the project and that it will help deliver “ a significant expansion of the JORC Standard Resource and Reserves for Orom-Cross”.

• Drilling is expected to take “approximately 2-3 months … [and lead to a] … revised JORC Resource … after drilling and assays are completed”.

• The Ugandan Government granted the project a 21-year Mining Licence in 2019.
• Drilling will “target extensions to the existing Northern Syncline and Camp Lode deposits as well as upgrading the overall Resource classification … [and will also include] … a step-out campaign to outline additional resources in a nearby target zone”.
• Initial JORC resources, covering “only ~2% of the total tenement area” at Orom Cross are an “Indicated & Inferred Mineral Resource of 24.5Mt @ 6.0% TGC (Total Graphite Content)”.
• The company describes Orom Cross as “a potential world class graphite project both by size and end-product quality, with a high component of more valuable larger coarse flakes within the deposit”.
• Executive Chairman, Cameron Pearce, expressed confidence that “this programme will significantly extend our JORC Resource and Reserve base and we will be working closely with our technical partners to deliver the best results possible in the shortest timeframe, feeding directly into the DFS”.
• He also said that Blencowe Resources is “especially excited to be drilling a new deposit which may ultimately deliver further higher grade tonnes into our project.  Higher production volumes will make a substantial difference to the NPV within the DFS modelling”.

Conclusion: Additional drilling at Orom Cross advances the DFS and could generate a larger resource inventory potentially enhancing the project’s economics.  We await the outcome of the drilling and revision of the mineral resources with interest.

Europa Metals Limited (EUZ LN) 2p, Mkt Cap £2m – Disposal of the Toral project in Spain

• Europa Metals confirms the completion of its previously announced disposal of its Toral zinc / lead /silver project in the Spanish region of Castilla y Leon to Canadian-based Denarius Metals Corporation for 7m shares in Denarius.
• The company also confirms that it is continuing to progress its previously announced plans to acquire Viridian Metals Ireland and its wholly-owned Tynagh lead/zinc/copper/silver project in Ireland.
• Europa Metals explains that following the disposal it “is now an ‘AIM Rule 15 cash shell’ and, as such, the Company shall have six months to make an acquisition or acquisitions which constitute a reverse takeover under AIM Rule 14 after which the shares would be suspended”.
• The Tynagh mine was worked as both surface and underground operations during the 1970s and hosts waste ‘tailings’ from this era which Europa Metals has previously described as at “an equivalent grade to what is being mined underground elsewhere today” comprising a CIM compliant “4.0mt@6.1% combined Zn+Pb, 1.4 Oz/t Ag (44g/t Ag), 18.95% BaO” plus “2.7mt@1.7% combined Zn+Pb, 0.4 Oz/t Ag (13g/t Ag), 9.5% BaO”.
• The company has also alluded previously to a “possible 3.0mt of non-compliant resources” at Tynagh.

Conclusion: The disposal of the Toral project in Spain leaves Europa Metals on a six months timetable to complete its plans to acquire Viridian Metals Ireland and process tailings from historic mining at Tynagh. We await developments.

Great Western Mining* (GWMO LN) 0.03p, Mkt Cap £2.3m – Sampling results from West Huntoon copper porphyry prospect

1. Great Western, the copper and precious metal explorer and processor in Nevada, provides exploration results.
2. The team has been targeting a potentially large-scale copper porphyry prospect called West Huntoon.
3. They have identified an anomalous copper zone over 2km² x 3km² with overlapping magnetic and chargeability anomalies alongside granite outcrops.
4. The Company has taken 47 soil samples, with 9 as infill. Results recorded median values of 157ppm Cu.
5. The exploration team also highlights that the anomalous samples ‘run to the edge of overlying cover, beyond which samples the potentially mineralised rocks are no longer accessible.’
6. The team believes the anomalous zone trends towards the Company’s M2 copper resource.
7. This corroborates findings from the IP surveys at West Huntoon, which showed chargeability under the edge of the valley sediments.
8. Additionally, the Company took six grab samples from the southwest area of the prospect, where they had identified a mineralised vein structure 1m long by 30cm wide at outcrop.
9. One selective sample from the vein structure recorded 16g/t Au, 207g/t Ag and 2.37% Cu.

*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 £38m – Saudi Arabia JV strategic update

• The Company agreed with its JV GMCO partner, ARTAR, to offset outstanding $10m due for its share of exploration costs in return for a 10% interest in GMCO.
• The Company will now hold 15% in GMCO, down from 25%.
• GMCO was sole funded by ARTAR over the past 12 months including exploration and FS related works at Jibal Qutman and Hawiah as well as a series of regional targets in Saudi Arabia.
• GMCO spent $80m to date on the portfolio of project to date.
• The Company decided against a pro rata contribution to maintain its interest in GMCO given current low Group valuation and deeming a potential equity raise to be overly dilutive.
• The team is considering different options for a potential sale of the remaining interest.
• Any sale of the remaining interest the Company expects to be based on open market valuation which may be at a significant premium to the latest deal which was based on historical cost only.

*SP Angel act as Nomad and Broker to KEFI Gold and Copper

Largo (LGO CN) C$2.8, Mkt Cap C$185m – 3Q24 financial results highlight cost optimisation efforts amid weak vanadium prices

• The Company released quarterly 3Q24 financial results for its vanadium operations at the Maracas Menchen Mine in Brazil.
• 3Q24 production totalled 3.1kt V2O5 (SepQ23: 2.2kt) marking the strongest quarterly output in seven years.
• Sales came in at 2.0kt V2O5 (SepQ23: 2.4kt).
• Realised prices averaged US$6.3/lb, down 25%yoy, as the market remained in oversupply in Asia and Europe.
• Latest data from Vanitec shows that the oversupply is now gradually reducing in early signs of improvement in market outlook.
• Cash costs ex royalties ($/lb sold) averaged $3.1/lb (SepQ23: $5.4/lb) reflecting management cost optimisation initiatives including a reductio in haulage distances, a drop in the number of contractors and a review of all contracts.
• Revenues amounted to US$29.9m (SepQ23: $44.0m).
• Adjusted EBITDA -$1.2m (SepQ23: -$1.6m).
• Mining related EBITDA excluding downstream LCE division and vanadium LPV fund totalled $3.4m (SepQ23: $2.7m)
• PAT amounted to -$10.1m (SepQ23: -$11.9m).
• The Company continued discussions with Stryten Energy regarding a non binding LOI for its downstream vanadium business, Largo Clean Energy, to establish a 50/50 JV in the US.
• The Company recently signed a $23.5m vanadium secured loan allowing access to additional liquidity at the time of depressed demand and vanadium prices.

Oriole Resources* (ORR LN) 0.31p, Mkt cap £12m – Issue of options in lieu of cash bonus

• Oriole have issued directors 166.7m options exercisable at 0.33p to directors.
• The exercise price reflects a 14% premium to the 30-day VWAP to 12^th November.
• Remuneration Committee Chairman, David Pelham, notes that ‘whilst a cash bonus would be the normal award, the individuals concerned agreed to conserve cash in the Company.’
• The remuneration reflects the successful delivery of the BCM agreement

*SP Angel acts as Broker to Oriole Resources

Power Metal Resources* (POW LN) 13p, Mkt cap £14.5m – Uranium JV update as drilling planned for 1Q25

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• Power Metals provides an update on their Badger Lake uranium prospect in the Athabasca Basin.
• The Property is subject to the recently signed JV with UCAM ltd and lies 35km from the Arrow and Triple R deposits.
• The Uranium-focused JV plans to conduct airborne geophysical surveying and an Ambient Noise Tomography ground geophysics survey to delineate drill targets.
• ANT has been used by other regional uranium explorers and developers, including Forum Energy Metals, ATHA Energy, and IsoEnergy.
• ANT uses multiple seismic detectors to pick up subtle changes in faulting, alteration and other structural geological effects.
• The JV notes particular success using ANT in the Athabasca and Thelon Basins.
• The accelerated plan is then to drill a multi-hole programme in February-March 2025.
• The JV has commissioned Axiom to conduct magnetic and electromagnetic surveys over Badger Lake from tomorrow.
• Magnetic surveys will support understanding of basement geology, with previous exploration ‘unable to provide a definitive conductive axis.’
• The JV is also set to receive radon, soil and biogeochemical sampling results, which from Badger Lake, which will also support drill target delineation.
• CEO, Sean Wade, explained that the JV’s exploration budget was believed to be the second largest “in the Athabasca Basin area” and that “In order to maximise our chances of discovery, we will continue to undertake the necessary sampling and surveying work before we commence drilling”.

Conclusion: The recently formed Joint Venture is well-funded for exploration and have decided to accelerate the programme at Badger Lake, with geophysics being conducted to delineate drill targets. Drilling is being targeted for 1Q25.

*SP Angel acts as Nomad and Broker for Power Metal Resources

Sovereign Metals* (SVML LN) 37.66p, Mkt Cap £225m – Sovereign completes mining trials at Kasiya rutile and graphite project in Malawi

(Sovereign currently holds 100% of the Kasiya project. Malawi has 10% free carry right. Rio Tinto acquired an initial strategic interest of 15% for A$40m mid 2023 and has recently invested a further A$19.2 to move up to 19.9%)

STRONG BUY – Valuation 55p

• Sovereign Metals report the conclusion of hydraulic and dry mining trials at the Kasiya project in Malawi
• The trials show the friable and soft ore at the Kasiya project are efficiently mined by simple dry mining with diggers and by hydraulic, high pressure, water monitoring·
• Dry mining can be mined to a depth of 20m using standard mobile excavators and trucks
• Hydraulic Mining is more involved requiring substantial water dams, boreholes, pumps and piping for high pressure water and wet ore as it is slurried to the first stage of mineral processing at site.
• Backfilling of the open pit is underway and will provide data for the land rehabilitation plan which is being overseen by the Rio Tinto- Sovereign Technical Committee.
• Land rehabilitation demonstrations are underway with the backfilling of the 120x110m test pit which was mined to a depth of 20m.
• Backfilling should finish in December.
• Sovereign has built a series of small rehabilitation pits to demonstrate multiple rehabilitation processes for land restoration with the same or better agricultural yields.
• ESG: The idea is to determine optimal rehabilitation and to show local communities how well the land can be rehabilitated for agricultural use after mining.
• The work will feed into the Kasiya EIA ‘Environmental and Social Impact Assessment’.
• Malawi: Food insecurity is a major issue in Malawi due to the impact of recent cyclones and droughts. The Sovereign-Rio Tinto team have helped raise crop yields with participating farmers through drought conditions.
• A recent award-winning film, Tobacco Slave’ chronicling the lives of Malawian tobacco farmers working under a contract system was recently shortlisted at the WHO 5^th Health of All Film Festival.
• We see the work being done with local farmers around the Kasiya project as setting a template which would serve to lift the nation out of its current state of food insecurity.
• Pictures in Sovereign’s press release show the high-pressure monitoring of ore in the trial pit followed by the benches created by the dry-mining trial and an ariel view of the water pond used to supply the high-pressure water monitor.

Conclusion:  Careful optimisation of the mining method and planning for rehabilitation should go far in terms of creating longer-term value for the Mali government, Sovereign, RioTinto and the local communities in the Kasiya mining area.

*SP Angel act as Nomad and broker to Sovereign Metals. The analyst has recently visited the Kasiya mine site. We highly recommend the Malawi coffee beans sold in Lilongwe airport.

 LSE Group Starmine awards for Q3 commodity forecasting:

No.1 in Precious Metals: SP Angel mining team awarded No 1. ranking for Previous Metals forecasting in LSEG Quarterly Starmine Award for Reuters Polls Q3 2024

No.2 in Base Metals: SP Angel mining team awarded No 2. ranking for Base Metals forecasting in LSEG Quarterly Starmine Award for Reuters Polls Q3 2024

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

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*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.

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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