The next focusIR Investor Webinar takes places on 14th May with guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
Cenkos broker note - Billion Barrel Potential
An independent resource estimate at Project Icewine has assigned 1.77 billion barrels of gross mean prospective resources to the prospects in the vicinity of the Charlie-1 well (1.1bnbbls net to 88 Energy). Significantly, 1.4 billion barrels (889mmbbls net to 88 Energy) have been assigned to the Seabee Formation, where 88 Energy encountered substantial net pay and excellent oil saturations in the cores taken from this horizon during the drilling of the Charlie-1 well. At Project Peregrine, after receiving multiple bids, 88 Energy has selected a preferred bidder, with execution of the farm-out expected in the next few weeks. Planning and permitting remains on schedule for an initial exploration well at Project Peregrine in late February 2021. Project Peregrine is located south of and on trend with the ConocoPhillips Willow discovery to the north, with ERCE Equipoise assigning 1.6 billion barrels of prospective resources across three prospects.
We update our valuation, setting our price target in line with our Risked Exploration NAV (RENAV) at 2.8p, a 600% premium to the current share price, and reiterate our BUY recommendation.
Unrisked, our valuation increases to 42.5p/share, underlining 88 Energy’s huge potential.
Post-period end aggressive expansion of supply of raw material Jubilee relies on supplementing its own feed with that from third party sources. Post-period (during Covid) Jubilee signed three agreements in Zambia for copper sources fully to supply (and enable an expansion at) Sable in Zambia. These are sensible joint ventures with Jubilee building and operating an upgrade plant with repayment of the capital out of profits. In South Africa, a new plant (Windsor 8) has been added to the production stable with three year contracts on supply into the Windsor circuits signed – we see the potential for additional material being made available to Jubilee in year (and indeed potentially for further, additional plants as well).
This is just the beginning Jubilee has shown its ability to get things done, especially during Covid. We see fair value at 12p from our underlying DCF analysis, but note that forward PEs and EV/EBITDA ratios are significantly lower than those of its peers. In our opinion a company generating cash from multiple operations in a strong commodity price environment should be seen favourably by the market as it hits its production and revenue targets. Q1 FY2021 already shows the progression required.
FY 2021 estimates : Sales £142.4m / GM £76.3m / PBT £60.8m / EPS 2.1p
WHI MORNING COMMENT - Jubilee Metals
Audited annual results (year ending June 30) – real progress made
Jubilee today releases its audited annual accounts for the year ending June 30 2020. As expected, the results show the real progress made through the year. Production up, revenues up (132% to £54.8), Operating profit up (226% to £15.9m and EPS up (96% to 0.94/sh).
We have seen solid progress on the expansion in the chrome and PGM projects in South Africa and consolidation of ownership of the projects against a background of Covid – which Jubilee successfully navigated.
The year also saw robust plans for expansion in Zambia at the Sable Refinery in Kabwe. Security of supply has been achieved by three transactions which tie up dump resources all set to feed into the (to be) expanded Sable Refinery and making Jubilee a producer of scale in Zambia.
We see fair value in Jubilee at 12p and present our first forecasts for the company (FY2021E).
26 October 2020
Vast Resources plc
(‘Vast’ or the ‘Company’)
Manaila Polymetallic Mine Update
Vast Resources plc, the AIM-listed production and development company, is pleased to update the market on progress at its Manaila Polymetallic Mine (‘Manaila’) and the adjacent Manaila Carlibaba Extension Project in Romania (‘Manaila Carlibaba’).
Further to the announcement made on 30 June 2020 regarding the granting of the Manaila Carlibaba Exploitation Licence, which allows the Company to re-examine the exploitation of the mineral resources within the larger Manaila Carlibaba licence area, the Company is pleased to update the market that its application to renew the Manaila mining licence for a further period of five years, to 29 October 2025, has been duly granted. The extended mining licence covers the larger Manaila Carlibaba licence area.
14 October 2020
Xtract Resources Plc
("Xtract" or the "Company")
UK Investor Webinar
Xtract Resources Plc ("Xtract" or the "Company") is pleased to announce that Colin Bird, Executive Chairman will be providing a Company update later today at the UK Investor Webinar at 4.30pm BST.
Investors can register for free to attend using the link below:
https://us02web.zoom.us/webinar/register/6316025947751/WN_wnhlZ70rR2uhKASDa04K4Q
Further details are available from the Company'swebsite which details the company's project portfolio as well as a copy of this announcement: www.xtractresources.com
UK Investor Webinars - Zak Mir in conversation with Gabriel Grego, also featuring Xtract Resources & Jubilee Metals
Oct 14, 2020 04:30 PM
Xtract Resources is the old Xtract Energy that Executive Chairman Colin Bird rescued back in 2013 and set on a new course. The early acquisition of a Chilean gold mine failed to meet expectations but the Manica Gold mining licence in Mozambique looks to be coming good. The company has been benefiting from a growing profit share from the alluvial gold on its licence area in a neat deal where other parties fund the necessary capex.
Growing profit share from Manica alluvials and hard rock gold mining
Profit share from Manica has been growing steadily for a couple of years now but it is about to step up a gear. The same sort of model is being employed at the Fair Bride hard rock deposit where a 35,000oz pa gold operation is set to begin before the year-end. Here, Omnia is providing the $6-8 million necessary capex and Xtract will get 23% of revenue after costs.
On course for £12.5m share of annual mining profits within 12 months
More similar profit-sharing deals are about to come to fruition at Eureka (copper & gold) and Kalenga (copper), dramatically transforming Xtract’s fortunes. The board has worked hard on these deals for a while, but it does seem that all the trains are about to arrive at the station at the same time.
Blue-sky projects include Bushranger in the hot Lachland Fold Belt
This area in New South Wales is Australia’s world-class copper-gold province and elephant country. Here, Xtract has just acquired an open ended JORC resource of 350,000t of contained copper in quite a coup. ASX listed explorers with interests here have recently seen big re-ratings.
Big disconnect in the share price as our valuation shows 480%+ upside
We believe our valuation is conservative and initiate coverage of Xtract with a target price of 6.56p and a Conviction Buy stance.
22 September 2020
Vast Resources plc
(“Vast” or the “Company”)
Zimbabwe Operations Update
Vast Resources plc, the AIM-listed mining company, is pleased to update the market on its operations in Zimbabwe.
The Company is proud to announce that Mark Mabhudhu, Executive Director of the Company’s Diamond Division, has received an offer to join the Government owned Zimbabwe Consolidated Diamond Company “ZCDC” as Chief Executive Officer starting immediately. Following a period of consultation with both the Company and the relevant Government of Zimbabwe Officials, a process that included a full disclosure as part of averting any possible conflict of interest, Mark Mabhudhu has accepted this role. As a result he will leave his current role with the Company.
The Company can confirm that its highly skilled geological and technical team remain employed by the Company and that it has identified a high level COO to manage the project who shall be engaged upon confirmation of the signing of the Joint Venture.
Mark Mabhudhu’s primary role will be to focus on the diamond sector’s contribution towards the Zimbabwean Government’s 2023 $12bn mining vision which is also driven by the attendant implementation of Joint Ventures between the ZCDC and investors in the diamond sector.
The Company can also confirm that this personnel change in Zimbabwe will not pose any impediment to the finalisation of the anticipated Joint Venture Agreement between the Company’s Subsidiary in respect of the Chiadzwa Community Diamond Concession.
Further details regarding the finalisation of the Chiadzwa Community Diamond Project will be communicated to the market as and when they occur.
Andrew Prelea, Chief Executive Officer of Vast Resources PLC Commented:
“Whilst we are of course sad to see Mark (Mabhudhu) leave Vast Resources PLC, we are extremely excited that we will be able to continue to work with him in his new role within the diamond mining sector in Zimbabwe. We are confident that with Mark in his new role, the diamond mining sector in Zimbabwe will be set for a new high.
“On behalf of the Board and Mangement Team, I would like to thank Mark for all of his efforts and wish him all the best for the future and stress that he will always have an open door to return to the Company when he finalises his mandate at the ZCDC.”
Mexico’s government plans to push ahead with a proposed nationalization of the country’s emerging lithium industry within months, despite opposition.
The ruling Morena party is planning reforms to the country’s constitution and mining code to pave the way for the move, according to the senate legislative agenda for the current parliamentary session, which runs to January 2021.
The reforms aim to protect the energy metal as a “strategic national resource.”
A boom in the global electric vehicle (EV) sector is expected to push up demand for battery-grade lithium in the coming years.
While Mexico does not currently produce lithium, this is set to change in 2023 when Bacanora Lithium begins production at the US$420mn Sonora project, being advanced in a joint venture with China’s Ganfeng Lithium.
Sonora hosts one of the world’s biggest lithium deposits, at 4.51Mt lithium carbonate equivalent.
Production will begin at 17,500t/y, which will double after a US$380mn expansion.
INDUSTRY OPPOSITION
Mexico’s mining industry is staunchly opposed to nationalizing lithium, plans for which were previously raised by former environment secretary Víctor Toledo Manzur, who quit the post ahead of a reshuffle this week.
“This is an extreme plan that would completely derail the progress in building a lithium industry in Mexico to date,” VSA Capital analyst Oliver O’Donnell told BNamericas in June.
Bad news for @BacanoraL & its Chinese investor/partner, #GanfengLithium, with regards to Sonora.
#Mexico’s government plans to push ahead with a proposed nationalization of the country’s emerging #lithium industry within months, despite opposition.
https://t.co/o05QPXdtr1
https://twitter.com/CoryGroshek/status/1302616229342064641?s=19
CEO INTERVIEW: Why Jubilee Metals Group secured 2 million tonnes of copper run-of-mine material - https://t.co/2E7WJEhdY4 #JLP @JubileeMetals #mining #PGM #Chrome #Copper #Zinc #Platinum #Palladium https://t.co/d30OH0KzPT
WH Ireland note : Under the agreement with a private Zambia company, Jubilee will construct a new upgrade facility on a Brownfield site with a 600kt/a throughput capacity at a cost of $15m – to be funded from cash and debt utilising Jubilee’s strong balance sheet. The material from Project “Roan” will be sold on an arm’s length basis to Sable using standard and conventional payment terms. The new material will enable Jubilee to increase production at Sable and to reduce its operating cost to $4,000/t copper. At a current copper price of ~$6350/t copper and a stated aim of getting to 10kt/a copper this would generate a Gross Operating Profit of $23.5m from Zambia alone. This is before we factor in other third-party material
to take us to the Sable plant capacity of ~14kt/a copper cathode; before we factor
in the start of zinc-lead-(vanadium) production from Kabwe tailings; and before
we consider an expansion at Sable copper to 25kt/a to take advantage of the
previously (18/06/2020) announced Project “Elephant” copper material in the
future. Zambia is the growth engine for Jubilee over the next couple of years.
Highlights
· Jubilee executes JV Agreement targeting the production of an additional 10 000 tonnes equivalent copper units per annum
· The Project targets to commence production of first copper concentrate within four months
· JV Agreement incorporates 2 million tonnes of in excess of 2% ROM Material with the potential to increase to 4 million tonnes of ROM Material as well as surrounding copper tailings material in excess of 2.5 million tonnes
· Under the JV Agreement, Jubilee will construct a new Processing Facility targeting a processing rate of approximately 600 000 tonnes per annum producing copper concentrate for further refining at its Sable Refinery
· The total Project capital is estimated at USD 15 million, to be invested over a period of twelve months, which Jubilee targets to fund utilising its cash reserves and access to debt funding, leveraging off its existing balance sheet
· The additional copper units supplied to Jubilee's Sable Refinery holds the potential to significantly enhance the earnings margin, targeting a unit cost of approximately USD 4 000 per tonne of copper cathode, offering a potential payback of the Project capital within one year
· The Processing Facility is strategically located to access the large potential of third-party copper ore in the area
· The Project is targeted to deliver copper units well in advance of Jubilee's previously announced copper transaction in Zambia ("Project Elephant") and is significant step towards achieving Jubilee's stated goal of 25 000 tonnes per annum of copper production
Leon Coetzer, CEO of Jubilee, commented:"This JV Agreement offers tremendous earnings potential for Jubilee. The Project has been a key target for Jubilee to drive the ramp-up in our copper production while we are implementing our previously announced Project Elephant. This transaction complements the already secured large copper resource and will provide us with earnings in the near term. The earnings of this Project is further bolstered when we commence the processing of the 150 million tonnes of tailings secured under Project Elephant, allowing us to expand and fill to capacity, over the long term, our Sable Refinery.
"The combination of easily accessible large surface resources, together with a fully operational copper refinery, offers us the potential to replicate, at a larger scale, the success Jubilee is achieving with its PGM and Chrome operations in South Africa. Our exceptional in-house processing and metals recovery abilities are core to this success.
"For Jubilee to have entered into this JV Agreement so soon after announcing Project Elephant is testament to a period of intensive work by our team and I would like to thank everyone for their efforts.
"We have already completed the designs for our Processing Facility and engaged with key equipment suppliers to accelerate the implementation of Project Roan. I am confident that we are able to fund the capital required fo
United has announced that it has successfully negotiated an 18 month extension to its Walton Morant licence, offshore Jamaica, in what could be a pivotal moment for the Company. United will assume a 100% working interest, and will complete a work programme to further de-risk the high-graded Colibri prospect ahead of a drill-or-drop decision in 2022. We view the award of the Walton Morant licence as a huge endorsement of the United team and its capabilities to operate a frontier, deepwater licence. We increase our risked valuation of the Colibri prospect to US$68.3m or 7.1p per share and our Company valuation to US$162.2m or 17p per share. Unrisked, our valuation of the Colibri prospect increases to US$752.7m or 78.7p, underlining its potential. We set our price target in line with our risked NAV at 17p, a 507% premium to the current share price, and reiterate our BUY recommendation.
? The Potential to Have a Major Impact United has been awarded Tullow Jamaica Ltd’s 80% equity in the Walton Morant licence, with the PSA extended by 18 months until the 31st January 2022. As operator and 100% equity holder, United will look to further de-risk the block’s prospectivity in advance of a drill-or-drop decision by the end of January 2022. The cost-effective work programme will be driven by feedback from those companies who have engaged in the farm-out process to date, with a view to maximising United’s chances of securing a farm-out in preparation of drilling. In keeping with analogous frontier basins, we would expect United to farm down its 100% working interest in exchange for a carry on the first exploration well.
? A Working Petroleum System By definition exploration is a high-risk business, but there is compelling evidence that a working petroleum system is present in Jamaica. Eleven wells have been drilled to date, with all bar one indicating hydrocarbon shows. Re-interpretation of historic 2D and the acquisition of 2,250sq km of 3D seismic data has high-graded the 229mmbbl Colibri prospect. Colibri is optimally located to test the offshore Jamaica petroleum system and has been further supported by the recent identification of an active oil seep to the south of the structure. Success at Colibri would also significantly de-risk the follow-on potential across the rest of the basin.
#ggp
Interview w/ CEO Gervaise Heddle
https://t.co/YkR6Z2k9eq
Very very exciting
Havieron we haven’t even scratched the surface which shows this is HUGE!
North west is key focus now and given many step outs we know they’re striking #gold
Imo start of multiples journey here
June 2020 Quarterly Production Report
W Resources (AIM:WRES), the tungsten, tin and gold mining company with assets in Spain and Portugal, announces its Q2 2020 quarterly production update for the La Parrilla mine in Spain and an update on its tungsten, tin and gold projects in Portugal. The quarter was significantly impacted by the COVID-19 state of emergency in Spain.
· A total of 253,256 tonnes ("t") of Run of Mine ("ROM") ore fed to the La Parrilla plant in Q2 2020.
· Total tungsten and tin contained metal production increased by 0.5% to 47.6 tonnes during the quarter, mostly as a result of strong tin recoveries.
· Tin ("Sn") metal production was the highlight increasing 65% to 20.0 dry metric tonnes ("dmt").
· Tungsten ("WO3") metal production decreased 17% to 2,756 metric tonne unit ("mtu") (27,560 kg) during the quarter as a result of the temporary mine closure and weaker than expected plant performance.
· Combined shipments of tungsten concentrate (58.9t) and tin concentrate (40.8t) increased to nearly 100t in Q2 2020, taking total shipments to offtake partners to 89.0t of tungsten concentrate and 40.8t of tin concentrate for the half year. A further 20.4t of tungsten concentrate and 39.0t of tin concentrate has been shipped from 1 July to date.
Market update
The period under review saw a solid price performance for our PGM basket, totalling US$1 593/oz and while down compared to the previous quarter's record pricing, the weaker ZAR did translate to an increased local basket price of ZAR29 266/oz as compared to the price of US$1 822/oz (ZAR27 690/oz) for the previous quarter. The combination of the dramatic slowdown of the global economy and the reduced output from the major South Africa PGM producers has translated into a continued positive outlook for PGM pricing.
PGM sales and deliveries have returned to pre COVID-19 levels.
The average metallurgical chrome price increased by 10.9% to US$143/t from US$129/t. Market prices are trading around US$160/t. Published port stocks in China have continued to trend lower at approximately 3.5 Mt down from a high of 4.3 Mt in the first quarter of 2020.
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Groucho
Groucho
Member
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New
#THS Salient features for the quarter ended 30 June 2020
? Platinum Group Metals ('PGMs') production increased by 9.0% to 35.0 koz (6E basis) compared to the prior quarter
? PGM basket price of US$1 593/oz (ZAR29 266/oz)
? Chrome production increased by 3.6% to 321.4 kt compared to the prior quarter
? Metallurgical chrome price up 10.9% to US$143/t
? Revised FY2020 production guidance of 130 koz to 135 koz PGMs (6E basis) and 1.25 Mt to 1.30 Mt of chrome concentrates
? PGM sales and deliveries have returned to pre COVID-19 levels
https://www.londonstockexchange.com/news-article/THS/production-report-q3-fy2020/14608573
WHI note now available on #JLP website :
https://jubileemetalsgroup.com/wp-content/uploads/2020/07/FN-JLP-080720.pdf
Opportunities and Upside:
? Potential for additional resources in South Africa. Our models do not include
any additional value from the potential deals in South African chrome / PGMs that we see after the current crisis. Jubilee is in a great position to take on more tailings dams and third party offtake agreements on a case-by-case basis – the operations are set up to accept a mixture of materials and we see this flexibility as a real strength.
? Scale. A big driver in Zambia is scale. Increased production allows Jubilee to reduce operating costs. We use a fixed $2/lb production cost in our models going forward, but with scale and a contribution from the new “Roan” and “Elephant” project material we could see our operating costs fall by $0.5/lb to $1.5/lb. An additional profit margin of $0.5/lb on 25kt/yr copper production is additional cash flow of $27m/yr which we do not yet include in our models.
? Wild Card Opportunity. There are plenty of opportunities in Southern Africa. Old mining districts, remnant resources – some of scale which could warrant Jubilee entering a new country for further diversification.
? Wild Card Price Spikes. The chrome price spikes every few years. At full production the chrome revenues from production in South Africa will be significant.