Resources Top 5: All is well in the land of gold

Creasy-backed PGD flies high after identifying ‘spectacular’ gold mineralisation at the Peninsula prospect
TEM spikes on the acquisition of Lole Mining and its ‘world-class’ portfolio of gold assets
1VG, EUR, and CCZ also up

Here are the biggest small cap resources winners in early trade, Friday August 5.

PEREGRINE GOLD (ASX:PGD)

Billionaire Mark Creasy’s Yandal Investments holds Top 20 stakes in more than 20 ASX listed companies, most of them junior explorers like gold-lithium explorer PGD.

Yandal investments scooped up a 9.6% stake in PGD for $2.25m back in Feb after subscribing for 4.5m shares at 50c each, plus 1.8m options exercisable at 75c each before 2025.

At the time of writing, shares in the company are up ~57% on news of ‘spectacular’ gold mineralisation found in drill core at its Peninsula prospect, 30km west of the town of Newman in WA.

A handheld core drill, able to core 40mm diameter drillcore, was utilised to drill two vertical holes adjacent to and beneath the visible gold observed at surface.

The two holes (A and B) were drilled approximately 1.5m apart, along strike and to a depth of approximately 50cm and 23cm respectively.

Recoveries were 95% for Core A and 100% for Core B with Core A drilled on the west side of Core B.

PGD technical director George Mahri says this is ‘very rare’ for a green field exploration program to encounter mineralisation of this nature, sitting undisturbed at surface.

Not only is it a very impressive demonstration of the high-grade potential of this system, Mahri says it highlights just how underexplored the area is.

PGD is a ~$26m market cap company with ~$4.33m cash in the bank at the end of the June quarter.

TEMPEST MINERALS (ASX:TEM)

In March TEM spiked hard on a potentially very large copper discovery.

Today, shares in the company have soared after it entered a conditional agreement with Lole Mining to acquire the ‘world-class’ portfolio of gold assets including the Tolukuma Mine and Mt Penck Project in Papuea New Guinea.

This transformative deal means TEM shareholders will benefit from the additional value of a near-term production asset within a +2,000km2 exploration portfolio along strike from some of the biggest gold and copper mines in the world.

They will also remain exposed to the significant upside and potential developments from the ongoing aggressive exploration at Meleya and other projects in Western Australia.

The deal comprises a conditional multi-stage transaction where Lole will amalgamate with TEM under its ownership in Papua New Guinea on an equity-based acquisition value of roughly $25.7M.

TEM managing director Don Smith says this is a major milestone, one that places the company as a gold developer and producer with potential for a strong revenue stream.

VICTORY GOLDFIELDS (ASX:1VG)

(Up on no news)

It was only two weeks ago that 1VG made the rarest of earthly discoveries at its Mafeking and North Stanmore projects in Western Australia but given demand is set to increase five-fold by 2030, we can kinda understand why it’s getting a whole lot of loving today.

The stock shot up 50% at the time on the latest results from follow-up assays that initially reported ‘significant’ anomalous values of yttrium (Y) at the project in the Cue goldfields, about 650km due northeast of Perth.

Fusion-ICPMS assays for Rare Earth Element and Yttrium (REEY) from 25 aircore 4m composite samples report high concentrations of Total Rare Earth Oxides (TREO) that exhibit a high ratio of Heavy Rare Earth Oxides (HREO) and gold:

Average (HREO) of 419ppm
Average (TREO) of 1020ppm
Highest (TREO) concentration of 3872ppm
Intersections up to 16m and remain open
Current strike length over 1km and a width of 200m that remains open
Highest Gold intersection of 0.5g/t

“This exploration success is comparable to several global saprolite deposits that also contain the critical metal scandium,” executive chairman Brendan Clark said at the time.

“Adamas Intelligence forecasts that the value of global magnet rare earth oxide consumption will triple from $15.1bn in 2022 to $46.2bn by 2035 – which affirms the potential opportunity with this discovery.”

EUROPEAN LITHIUM (ASX:EUR)

Shares in EUR are on the run this morning after receiving a massive vote of confidence with premium automobile manufacturer BMW AG signing up to be its first offtake partner for battery-grade lithium hydroxide.

Although still at an early stage, the fact that a company of BMW’s size and influence has agreed to negotiate suitable commercial terms for the purchase of the battery chemical speaks volumes about the value of its Wolfsberg lithium project in Austria.

BMW AG sold over 2.5 million passenger vehicles and more than 194,000 motorcycles worldwide in 2021 through its BMW, MINI, Rolls-Royce and BMW Motorrad brands.

It had previously flagged that by 2030, 50% of its sales would be electric vehicles, a move that is certainly welcome in the European Union given it wants to effectively ban petrol and diesel cars from 2035.

“Securing our first offtake with BMW AG is another key milestone for the company and partnering with BMW AG is an ideal fit for EUR,” EUR chairman Tony Sage says.

CASTILLO COPPER (ASX:CCZ)

(Up on no news)

Several rounds of preliminary metallurgical test work on BH1 drill core extracted from The Sisters prospect at Broken Hill delivered ‘excellent’ results for cobalt earlier this week and surprisingly, copper and gold as well.

The best outcomes include:

Cobalt: 200ppm head-grade up to 2,500ppm post-test-work; 12x upgrade
Copper: 520ppm head-grade up to 16,000ppm (1.6%) post-test-work; 30x upgrade
Gold: 0.02g/t gold head-grade up to 3.87g/t gold post-test-work; >190x upgrade

The metallurgical test-work showed that cobalt-copper-gold liberated easily from BH1 drill-core samples to produce a potentially viable concentrate.

Moving forward, the board’s primary focus for the East Zone is to increase the confidence in the current inferred mineral resource estimate (MRE) which stands at 21,556t cobalt (64Mt at 318ppm cobalt) and 44,260t copper (63Mt at 0.07% copper).

The geology team are close to finalising optimal cobalt targets across several prospects for the inaugural drilling campaign, which will be implemented once regulatory approvals are secured.