SP Angel Morning View -Today’s Market View, Wednesday 4th December 2024

Metals climb as focus turns to China’s Central Economic Work Conference for stimulus guidance

MiFID II exempt information – see disclaimer below

Amaroq Minerals (AMRQ LN) – £27.5m equity raise

Anglesey Mining (AYM LN) – Addition of zinc to UK’s list of Critical Minerals

Bushveld Minerals* (BMN LN) SUSPENDED – Chairman and CEO resign

Greatland Gold (GGP LN) – Completion of the Havieron/Telfer acquisition

KEFI Gold and Copper* (KEFI LN) – New licenses prospective for copper and tantalum/lithium secured in Ethiopia

GreenRoc Strategic Materials Plc (GROC LN) – MoU for Advanced Anode Material supply in Norway from graphite mine in Greenland

Lundin Gold (LUG CN) – Exploration results form Bonza Sur

Rio Tinto (RIO LN) – Rincon DLE lithium project upgrading to 60,000t LCE in Argentina. Collaboration with Sumitomo at Winu copper gold project in Australia

Sigma Lithium (SGML US) – Production ramp up at Groto de Cirolo

Trigon Metals (TN CN) – Indicative Term Sheet for Sale of Kombat Mine

Tungsten West (TUN LN) – Appointment of Chairman

Vale* (VALE US) – Vale Day highlights shifting iron ore strategy and base metals growth pipeline

Metals climb as focus turns to China’s Central Economic Work Conference for stimulus guidance

• Copper broke through $9,000/t yesterday after China fixed a date for a key economic conference.
• This spurred optimism over an additional round of stimulus to shore up the property market.
• Iron ore rose alongside copper, with both hoping for additions to the recent US$1.4bn stimulus round.
• The tin sell-off seems to have cooled, whilst nickel is also rebounding.

Gold ($2,640/oz) holds steady after JOLTs numbers came in above expectations

• Gold prices held steady over the past 24 hours, despite South Korean chaos.
• JOLT’s ‘Job Openings and Labor Turnover Survey’ support hopes of a rebound in labour data after October’s weak NFP number.
• Consensus for NFPs on Friday suggests 218k additional jobs and a revision from last month’s 12k additions after hurricane impacts lessened.
• US Treasuries have cooled rally, after the 10 year yield fell from 4.5% to 4.17%, now back to 4.25%.
• The slide in yields has weighed on the dollar, supporting gold prices.
• Platinum and palladium have resumed their downtrend.

Uranium – Meta is seeking proposals from nuclear power developers supporting its drive in scaling up AI capacities and meeting increasing data centres’ related power demand.

• The Company is seeking to add 1-4GW of new US nuclear generation capacity (1-4 reactors assuming typical size) from early 2030s.

Bolivia accelerates DLE studies to begin extraction

• Bloomberg reports Bolivia’s state -owned YLB has signed agreements for DLE extraction.
• The Company will work alongside EAU Lithium, Argentina’s Tecpetrol and France’s Gelith Actaris.
• President Arce stated that Bolivia is open for investors and additional agreements are set to be signed over the coming months.

121 Mining Investment Conference – Investment Leaders – Alternative Finance Panel

• https://www.theassay.com/videos/panels-presentations/investment-leaders-panel-alternative-financing-strategies-whats-best-for-the-junior-market-at-this-moment/

Economics

China

• Caixin Services PMI (Nov/Oct/Est): 51.5/52.0/52.4
• Caixin Composite PMI (Nov/Oct/Est): 52.3/51.9/NA

Italy

• Preliminary Services PMI (Nov/Oct/Est): 49.2/52.4/50.8
• Preliminary Composite PMI (Nov/Oct/Est): 47.7/51.0/49.6

Spain

• Preliminary Services PMI (Nov/Oct/Est): 53.1/54.9/53.3
• Preliminary Composite PMI (Nov/Oct/Est): 53.2/55.2/53.8

France – President Macron seeks to reject vote which could overthrow his government

• Macron has offered to resign before his term ends. Maybe that’s one minute before his term ends?
• French bond futures fell on the prospect of further political turmoil.
• The situation is down to Michel Barnier’s 2025 budget proposal.
• Barnier had originally proposed a €60bn deficit reduction to satisfy Brussels but has now proposed a new budget with greater spending and fewer tax cuts.

South Korea – Parliament restores democracy to South Korea after President imposes martial law

• MPs broke into parliament to restore democratic power to South Korea on Monday.
• Jung Su-yeon, an opposition politician bravely fought off paratroopers who were trying to take the building with a fire extinguisher.
• Fortunately, the South Korean army decided not to use force to prevent proper the restoration of the political system.
• President Yoon Suk Yeol, who is facing corruption charges, declared martial law on Monday asking paramilitary forces to take parliament.
• Security forces failed in their attempt to secure the parliament building by blocking roads with tanks and buses
• The opposition will now seek to impeach the President.
• This is not the first major corruption scandal to hit South Korea which ranks 32^nd out of 180 countries according to Transparency International
• The benchmark Kospi Index closed down 1.4% after recovering slightly from a 2.3% loss earlier.
• The won is down 0.8% after having fallen as much as 2.9% earlier on Tuesday.
• Once impeached president will be suspended immediately with a new election to be held within 60 days post removal or resignation of a president.

Currencies

US$1.0501/eur vs1.0522/eur previous. Yen 150.36/$ vs 149.95/$. SAr 18.158/$ vs 18.079/$. $1.268/gbp vs $1.268/gbp. 0.642/aud vs 0.650/aud. CNY 7.270/$ vs 7.281/$.

Dollar Index 106.44 vs 106.27 previous

Precious Metals

Gold US$2,637/oz vs US$2,642/oz previous

Gold ETFs 83.1moz vs 83.1moz previous

Platinum US$948/oz vs US$957/oz previous

Palladium US$969/oz vs US$995/oz previous

Silver US$30.8/oz vs US$30.9/oz previous

Rhodium US$4,575/oz vs US$4,575/oz previous

Base metals:   

Copper US$9,106/t vs US$9,078/t previous

Aluminium US$2,616/t vs US$2,610/t previous

Nickel US$16,115/t vs US$15,950/t previous

Zinc US$3,102/t vs US$3,087/t previous

Lead US$2,076/t vs US$2,071/t previous

Tin US$28,910/t vs US$28,895/t previous

Energy:           

Oil US$73.8/bbl vs US$72.4/bbl previous

• Crude oil prices moved after the US imposed further sanctions targeting Iranian crude exports and despite the API estimating an unexpected 1.2mb w/w build (-2.1mb draw exp) to US crude inventories.
• European gas prices edged down as French nuclear reactor operating levels rose 2% w/w to 80% of 61.4MW capacity, with Gazprom reporting a stable gas supply of 42.4mcm/d (~1.5bcf/d) via the Sudzha metering station.
• Centrica and EDF announced the 1-2 year extension of the lives of its four operational advanced gas-cooled reactor (AGR) nuclear power stations with 4.6GW capacity, which are expected to add 45TWh of zero carbon electricity to the UK’s output (broadly equivalent to 330bcf of natural gas or 62 LNG tankers).
• SLB Capturi has completed construction of the world’s first industrial-scale carbon capture plant at Heidelberg Materials’ Norwegian cement facility in Brevik, which is expected to capture 0.4mtpa of CO2 annually from start-up in 2025. The Brevik CCS plant is part of the largely State-funded NOK30bn Longship CCS project.

Natural Gas €48.0/MWh vs €48.6/MWh previous

Uranium Futures $77.5/lb vs $77.3/lb previous

Bulk:   

Iron Ore 62% Fe Spot (cfr Tianjin) US$106.3/t vs US$105.8/t

Chinese steel rebar 25mm US$491.0/t vs US$491.0/t

HCC FOB Australia US$205.5/t vs US$206.3/t

Thermal coal swap Australia FOB US$135.5/t vs US$136.0/t

Other:  

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

NdPr Rare Earth Oxide (China) US$56,946/t vs US$56,798/t

Lithium carbonate 99% (China) US$10,247/t vs US$10,233/t

China Spodumene Li2O 6%min CIF US$790/t vs US$790/t

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

China Tungsten APT 88.5% FOB US$338/mtu vs US$338/mtu

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

Europe Vanadium Pentoxide 98% US$5.0/lb vs US$5.0/lb

Europe Ferro-Vanadium 80% US$26.3/kg vs US$26.3/kg

China Ilmenite Concentrate TiO2 US$301/t vs US$303/t

China Rutile Concentrate 95% TiO2 US$1,121/t vs US$1,119/t

Spot CO2 Emissions EUA Price US$64.9/t vs US$64.9/t

Brazil Potash CFR Granular Spot US$287.5/t vs US$287.5/t

Germanium China 99.99% US$2,825.0/kg vs US$2,825.0/kg

China Gallium 99.99% US$430.0/kg vs US$430.0/kg

Battery News

China’s NEV sales almost reach 1.5m for November

• According to preliminary figures from the China Passenger Car Association (CPCA), wholesale figures for NEVs in China reached 1.46m in November, a new record high.
• Sales in November were up 51% yoy and 6% from October.
• This is the fifth time China’s monthly NEV wholesale sales have exceeded 1m units, with the last three months all seeing sales over 1.2m units.
• Sales have grown rapidly in the second half the year following the introduction of subsidies for scrapping old cars and buying new vehicles through trade-in.
• China began subsidising trade-ins at the end of April to support auto consumption, and at the end of July, the subsidy amount was doubled.
• As of 18^th November, there were more than 2m applications for the subsidies.

100,000 VW workers on strike across Germany

• IG Metall union said that almost 100,000 Volkswagen workers joined strikes protesting against wage cut plans and potential closure of plants.
• VW has threatened to close plants in Germany for the first time in its 87-year history to reduce costs and boost profits.
• The automaker is struggling with weak demand, high production costs, and increased competition from Chinese rivals.

Company News

Amaroq Minerals (AMRQ LN) 91p, Mkt Cap £312m – £27.5m equity raise as Nulanaq Gold Mine ramps up in Greenland

• The Company raised £27.5m issuing 32.0m new shares at 86p.
• The raise was completed essentially at the closing price on Tuesday and represents an increase from initially targeted £20m.
• New shares account for ~8% of the enlarged share capital.
• CEO (Eldur Olafsson) and two NEDs (Sigurbjorn Thorkelsson and David Neuhauser) subscribed for £0.5m and £1.1m worth of stock, respectively.
• Landsbankinn hf. Agreed to underwrite up to £10m while committing to procure subscribers or itself subscribing for new shares for an amount equal to the difference between £10m and £20m.
• Proceeds will be used for:
  • Working capital flexibility during the Nalunaq Gold Mine ramp up;
  • Resource drilling at Nalunaq targeting an increase in the MRE;
  • Advancing the Company’s strategic minerals business, alongside JV partners, with further targeted exploration;
• The Company is considering a potential step-up listing on the Main Market from AIM.

Anglesey Mining (AYM LN) 0.95p, Mkt Cap £4.5m – Addition of zinc to UK’s list of Critical Minerals

• Anglesey Mining draws attention to the publication of the UK’s 2024 assessment of Critical Minerals.
• The Assessment, published by the British Geological Survey, updates the 2021 ‘UK Criticality Assessment’ which identified 21 minerals and expands the list to 34 minerals adding zinc, one of the commodities within Anglesey Mining’s mineral resource at Parys Mountain, to the list.
• Parys Mountain hosts a ‘Measured, Indicated & Inferred’ resource of 16.06mt at an average grade of 0.98% copper, 1.33% zinc, 0.71% lead, 15g/t silver and 0.17g/t gold

• Referring to other commodities within the Parys Mountain resource, the company also explains that “Copper (Cu) is currently on the critical minerals lists in China, USA, Canada, India, Japan and South Korea. Although not meeting their normal thresholds, it has been added this year to the Australian Critical Minerals list and has been listed on the EU critical minerals list as a “strategic mineral … [although] … Copper is not at present on the UK Critical Minerals List”.
• Expressing the view that Anglesey Mining is optimistic that “an increase in demand for those minerals will make the project more attractive to investors and will also provide stable commodity prices to support our business plan … [CEO, Rob Marsden confirmed that] … our recent focus at Parys Mountain has been to push forward with the planning and permitting for the new mining project”.

Conclusion: The expanded list of Critical Minerals recognised in the UK may enhance the profile of the Parys Mountain project

Bushveld Minerals* (BMN LN) SUSPENDED – Chairman and CEO resign

• Michael Kirkwood (Independent Non Executive Chairman) will be stepping down from the Board with immediate effect.
• Craig Coltman (CEO) is resigning from the Board but will remain with the Company during his three month notice period working together with appointed business rescue practitioners.
• The Board now consists of two non executive directors including Mr Kevin Alcock and Mr Mirco Bardella.

*SP Angel act as nomad and broker to Bushveld Minerals

Greatland Gold (GGP LN) 7.45p, Mkt Cap £744m – Completion of the Havieron/Telfer acquisition

• Greatland Gold confirms the completion of its acquisition of the 70% of the Havieron project which it does not own and the nearby Telfer gold mine in WA from Newmont Mining.

• Under the agreement, which resulted from Newmont’s acquisition of Newcrest Mining, “Greatland has paid the following upfront consideration upon Completion:
  • US$167.0 million Acquisition consideration (after estimated purchase price adjustments¹); and
  • US$167.5 million in the form of 2,669,182,291 Greatland ordinary shares issued to Newmont (Consideration Shares), representing 20.4% of Greatland shares on issue [and]
  • a US$52.4 million cash repayment of the entire outstanding balance of the Havieron joint venture loan, which has now been terminated

• Deferred payments of

• • “A$23 million in aggregate estimated purchase price adjustments¹ due 180 days after Completion”; and
  • “a maximum of US$100 million in deferred cash consideration which may be payable to Newmont on the first five years’ Havieron gold production, through a 50% price upside participation by Newmont above a US$1,850/oz hurdle gold price, subject to an annual cap of US$50 million and aggregate cap of US$100 million”.

• Describing completion of the acquisition as “a watershed moment for Greatland” Managing Director, Shaun Day, said that “Greatland’s discovery of the world class Havieron orebody in 2018 established our platform for growth.  Returning to 100% ownership of Havieron now gives us the opportunity and control to deliver the project’s full potential”
• He explained that “Telfer is an iconic Australian mine that immediately transforms Greatland into a significant producer of gold and copper, with a defined mine plan that is materially de-risked by substantial ore stockpiles, and significant mine life extension prospects. Telfer production is expected to generate significant free cash flow, which we expect will help to self-fund the completion of Havieron’s development”.
• Mr. Day thanked shareholders and the company’s bank syndicate as well as Newmont, now Greatland Gold’s “major shareholder”, for their support.
• He also acknowledged the “exceptional efforts and achievements of our Greatland team, both Board and management … [and said that] … we are pleased to be augmenting our team with an established Telfer workforce”.

Conclusion: Securing control of the Havieron project and the Telfer mine provides Greatland Gold with a stable platform to develop Havieron using the existing processing capacity at Telfer. We look forward to completion of the project Feasibility Study in H2 2025.

KEFI Gold and Copper* (KEFI LN) 0.5p, Mkt Cap £32m – New licenses prospective for copper and tantalum/lithium secured in Ethiopia

• The Company secured the Konson Critical Metals Area exploration license in Ethiopia.
• The area was previously explored by the Ethiopian Geologicla Survey and Vale before leaving the country in 2012.
• Historic exploration identified areas of copper and tantalum mineralisation warranting follow up assessment.
• The 22km2 license is located 635km SW of Adis Abab, next to the city of Arba Minch.
• The license is valid for an initial term of three years and renewable given demonstrable progress.
• Vale early-stage reconnaissance included airborne geophysics, ground geochemistry, surface mapping and rock chip sampling.
• The Company will start an initial programme including mapping, trenching and geophysics studies focusing on areas that Vale had no interest in at the time including tantalum/lithium.
• Konso’s granitic pegmatites have analogies with those of the internationally well known local Kenticha Project hosting an LCT pegmatite occurrence geologically comparable with Greenbushes, Australia and Altia No. 3, Peoples Republic of China.

Conclusion: The Company secures early stage prospective in copper/tantalum/lithium exploration licenses in Ethiopia and we are looking forward to exploration results with anticipation.

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

GreenRoc Strategic Materials Plc (GROC LN) 1.58p, Mkt Cap £3.12m – MoU for Advanced Anode Material supply in Norway from graphite mine in Greenland

• GreenRoc has signed a non-binding MOU with Morrow Batteries ASA for the collaboration and development of AAM ‘Active Anode Material’, which is essential for Li-ion batteries.
• The MoU covers the evaluation and potential development of:
  • Secured Supply of Proven Quality AAM: GreenRoc intends to supply graphite concentrate from its planned mine at Amitsoq in Greenland.
    • GreenRoc intends to produce AAM of consistent quality from its graphite mine in Greenland.
  • Hydropower: management plan to largely power its AMM plant with hydropower which is readily available in Norway.
  • AAM Specifications: management to tailor its AAM product to Morrow’s specifications and to adjust the AMM material quickly when required.
  • R&D: both parties will work to enhance battery cell capacity and durability thorough optimised material production.
  • Location: the proximity of Morrow’s gigafactory to GreenRoc’s planned European AAM plant in the  Eyde Material Park should enable close collaboration.

• Morrow started the first European LFP Gigafactory in August at the Eyde Materials Park in Norway, just 3km from the Port of Arendal at Eyde.
• The company is committed to delivering 5.5GWh of batteries over seven years to Nordic Batteries, which builds customised power storage for Å Energi, ABB, Siemens, PKA and Nysnoe Climate Investments.

• “Morrow aims to deliver sustainable, high-performance batteries by eliminating toxic solvents and reducing nickel use.  The company plans to start with LFP batteries and advance to LNMO technology on a scalable platform.”
• Morrow shareholders include Siemens, ABB, PKA, Nysnø Climate Investments, Noah AS, and Å Energi.
•  GreenRoc’s PFS on the Amitsoq graphite project in Greenland (11 July 2024) shows:
  • NPV of US$621m vs $545m – post tax
  • IRR 26.5% vs 25.3%
  • Capex $340m vs $321m
  • Opex $1,872/t vs $2,211/t
  • Production 80,000tpa of concentrate – remains the same
  • Production 39,700tpa active anode material – remains the same
  • Includes: onsite production of de-ionised water and construction of a plant for the production of nitrogen.
  • Opex could reduce to US$1,662 using NaOH instead of HF with an increase in Capex cutting post-tax NPV8 to US$601m with an IRR of 23.7%.

Conclusion:  GreenRoc’s MoU with Morrow Batteries and its move to process AMM material in Norway, close to its mine in Greenland and next to the Morrow Gigafactory should reduce transport times, CO2 and improve R&D collaboration. While the MoU is non-binding we see the deal as transformational for GreenRoc which looks set to become a significant graphite producer for Europe.

Lundin Gold (LUG CN) C$34, Mkt Cap $8.2bn – Exploration results form Bonza Sur

• Ecuadorian gold producer Lundin Gold provides an update from their Bonza Sur exploration efforts.
• The Company has been drilling in proximity to the Fruta del Norte mine.
• Drilling has reportedly extended the deposit’s length by 800m to 2.6km strike and widened to 150m.
• Bonza Sur seen as open at depth and in all directions.
• Highlights:
  • AMN -2024-156: 100m at 2.35g/t Au from 333m
  • BLP-2024-189: 124m at 1.54g/t Au from 73m
  • BLP-2024-162: 116m at 1.43g/t Au from 47m
  • BLP-2024-173: 133m at 1.22g/t Au from 32m.
• Company expects to report a separate Bonza Sur MRE by mid-year 2025.
• Lundin Gold has drilled 56.1km over 2024, targeting 65km.
• 43 drill holes over 17,315m have been drilled at Bonza Sur over the last programme.

Rio Tinto (RIO LN) 4,972p, Mkt cap £63bn – Rincon DLE lithium project upgrading to 60,000t LCE in Argentina. Collaboration with Sumitomo at Winu copper gold project in Australia

• Rio Tinto confirms that Japan’s Sumitomo Metals and Mining (SMM) has signed a Term Sheet to participate in a joint venture to develop the Winu copper/gold project in WA.
• SMM will “pay Rio Tinto $399 million for a 30% equity share of the project. This includes $195 million upfront and $204 million in deferred considerations contingent on milestones and adjustments to be agreed” with Rio Tinto retaining operational management of the project.
• Rio Tinto and SMM “have also entered into a letter of intent to develop a broader strategic partnership to work together to explore opportunities for commercial, technical and strategic collaboration across copper, other base metals and lithium”.
• The companies “will now work to finalise definitive agreements for the Winu project joint venture in the first half of 2025, along with formalising the broader strategic partnership”.
• In a separate announcement today, Rio Tinto reports an initial mineral resource and reserve estimate for its Salar del Rincon lithium brine project in Argentina.
• “Mineral Resources inclusive of Ore Reserves comprise 1.54 Mt Lithium Carbonate Equivalent (LCE) of Measured Resources, 7.85 Mt LCE of Indicated Resources and 2.29 Mt LCE of Inferred Resources. The Ore Reserves comprise 2.07 Mt LCE of Probable Ore Reserves”.
• The company explains that the “proposed project consists of brine extraction using a production wellfield, processing and waste facilities, as well as associated infrastructure. Full-scale production based on the current feasibility study is estimated to be approximately 53 kt of battery grade lithium carbonate per year for a period of 40 years”.
• Rio Tinto also says that “plans are in place to build for a capacity of 60 kt of battery grade lithium carbonate per year with debottlenecking and improvement programs scheduled to unlock this additional throughput, subject to permitting”.
• In a third announcement this morning, Rio Tinto explains that its 2024 Investor Seminar in London today “will provide updates on its strategy of investing for a stronger, more diversified and growing portfolio to ensure the long-term delivery of attractive shareholder returns”.
• Chief Executive, Jalob Stausholm, explained that “As we ramp up the Oyu Tolgoi underground copper mine, deliver the Simandou high-grade iron ore project in Guinea, and build out our lithium business through the proposed acquisition of Arcadium¹, we are underwriting a decade of profitable growth”.
• The announcement highlights progress towards:
  • Delivering “a further 5 million tonne year-on-year uplift in 2024 and 2025, a cumulative 15 million tonne uplift … [from its Pilbara iron ore operations] … over three years”; and
  • Stabilising its aluminium business and establishing “a clear pathway to deliver greater returns through growth and decarbonisation”; and
  • “Targeting annual production of 1 million tonnes of copper by the end of this decade underpinned by an increase in output from Oyu Tolgoi in Mongolia where production is expected to increase more than 50% next year”; and
  • Acceleration of production from “Arcadium in Argentina and Canada … [and ] … Advancing the Rincon 3000 starter project in Argentina which delivered first lithium last week”; and
  • Progress “at Simandou in Guinea, which remains on-track for first ore next year and to reach full capacity by 2028”; as well as
  • “Substantial progress” in delivering decarbonisation with capital expenditure expected between “$5 to $6 billion” up to 2030.

Conclusion: Alliance with Sumitomo to progress Winu extends an existing relationship with intention for longer term strategic commercial and technical collaboration in copper, lithium and base metals.

Sigma Lithium (SGML US) $13, Mkt Cap $1.5bn – Production ramp up at Groto de Cirolo

• Brazilian spodumene miner Sigma reports it’s Groto do Cirilo plant in Brazil reached continuous production of 850 continuously in December.
• The Company has sold 27,5kt spodumene concentrate to Abu Dhabi’s IRH at 8.25% of the battery-grade carbonate price on a 6%, CIF China basis.
• Company reports it has now reached annualised production run rate of 270kt, full capacity.
• That rate of production is expected to be maintained going forward.
• The Company is now aiming to replicate Plant 1 with a second plant aimed to double production to 520ktpa at CAPEX of US$100m.

Trigon Metals (TN CN) C$0.58, Mkt Cap C$25m – Indicative Term Sheet for Sale of Kombat Mine

• Trigon reported yesterday that it has received a term sheet from Horizon Corporation for the sale of its 100% interest in the Kombat copper mine in Namibia.
• The Term Sheet includes a range of US$30-50m in cash and a limited royalty.
• Horizon to loan Trigon US$5m:
  • US$500k within first seven days of a binding agreement.
  • US$2m in December 2024 subject to satisfying closing conditions, with Horizon receiving security for the loan, covering due diligence and entering binding documentation.
  • US$2.5m within 45 days of the Tranche 2 payment outlined above.
• The US$5m loan with have a term of 24 months and an interest rate of 15%pa.
• Horizon will be granted exclusivity to finalize asset sale agreement for advancement of the loan.
• Trigon will retain the Kalahari Copper Project in Namibia, alongside potential benefits from spinout of the Safi Silver Moroccan exploration projects, Silver Hill and Addana polymetallic projects.
• Kombat holds reserves of 0.75mt at 0.93% Cu for 6,953t Cu in the open pit, and 1.64mt at 3.2% Cu underground for 51.6kt.

Tungsten West (TUN LN) – 3p, Mkt cap £5.7m – Appointment of Chairman

• Tungsten West has announced that Stephen Harrison has been appointed as non-executive Chairman.
• Mr. Harrison is a former executive of Hanson plc and is “currently Chairman of Epwin Group plc, the AIM listed manufacturer of energy efficient and low maintenance building products, and a non-executive director at Castings plc, a leading iron casting and machining group”.
• He replaces the current incumbent, Mr. David Cather, who will remain on the Board in a non-executive capacity.
• Mr. Harrison said that he was “delighted to be joining the Board of Tungsten West at this exciting time, and I look forward to helping progress Hemerdon towards the recommencement of production to secure this vital supply of critical minerals in the UK”.
• Outgoing Chairman, Mr. Cather, welcomed him describing him as “a highly successful businessman whose skills and experience will be invaluable to the Project at this crucial time”
• Mr. Cather also commented that “Following Jeff Court’s appointment as CEO in October, the Company now has a highly experienced leadership team which is well placed to bring Hemerdon back into production”.
• Mr. Court thanked the outgoing Chairman for his contribution and confirmed that Tungsten West is “well placed to restart mining in 2026 … as we complete our feasibility study and capital raise”.

Conclusion: The appointment of the new Chairman follows that of a new CEO in October refreshing the leadership team as it moves towards completion of the Hemerdon feasibility study and an expected resumption of production in 2026.

Vale* (VALE US) US$9.6, Mkt Cap US$44bn – Vale Day highlights shifting iron ore strategy and base metals growth pipeline

• Vale guided to 325-335mt of iron ore production in 2025, vs 328mt in 2024.
• Iron ore C1 cash costs expected to fall below $20/t by 2026, vs $22/t this year (nominal basis), before falling to US$18-19.5/t by 2030 with an AISC of <US$50/t.
• Vale announces plans to adjust its portfolio for lower iron ore demand, adjusting specs for market scenarios and varying steel margins.
• Given lower steel margins currently, Vale will lower product quality as premiums slide.
• CEO Pimenta stated that ‘it has been hard for them (steelmakers) to transition to lower-carbon products, hard to maintain the business in a profitable way.’
• Company also guided to copper production growth, rising from 350ktpa currently to 420-500ktpa in 2030, then 700ktpa by 2035.
• Copper growth targeted from Salobo, Sossego, Voisey’s Bay/Sudbury and the ramp up of Alemao.
• CAPEX forecast at US$6.5bn in 2025, with US$2-2.5bn aimed at the base metals portfolio, and US$4-4.5bn at iron ore.
• Company has expanded their net debt target range to US$10bn-US$20bn.
• Iron and Steel Market Outlook
  • Expects Chinese steel production to fall from 1,020mt in 2024 to 970mt in 2030, whilst global production rises from 1,910mtpa to 2,100mtpa in 2030.
  • Iron ore demand to slide from 1,550mt to 1,545mt in 2030 on soft Chinese seaborne demand and rising scrap consumption.
  • Growth of southeast Asian blast furnaces and rising direct reduction feed demand from Middle East.
  • Seaborne iron ore supply expected to fall from 1,600mt in 2024 to 1,495mt in 2030, assuming US$90/t and 320mt of depletion.

*An SP Angel analyst holds shares in Vale

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

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.

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.

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