Investors are becoming increasingly clued in about the potential of kaolin and halloysite if Pinnacle’s heavily oversubscribed $4.5m initial public offering is anything to go by.

The company had raised the funds through the issue of 22.5 million shares priced at 20c each, giving it a market capitalisation of $7.275 million and an enterprise value of just $2.475m thanks to its tight capital structure with just 36.375 million shares on issue.

Proceeds from the IPO will be used to execute Pinnacle Mineral’s (ASX:PIM) targeted exploration and development plans across its target portfolio, which consists of the advanced Bobalong and Holly kaolin projects in Western Australia and the White Knight and Camel Lake kaolin-halloysite projects in South Australia.

Kaolin is used in the paper and ceramics industries, although new applications are always being discovered.

Halloysite is used in the existing ceramic, pharmaceutical and cosmetic markets and, increasingly, in the battery and nanotechnology sectors.

“We aim to ‘hit-the-ground-running’ on fieldwork, commencing with resource definition drilling at the advanced Bobalong kaolin project,” executive director Robert Hodby said.

“This will be complemented by field programs across all projects, which will help ensure a strong stream of material news flow.”

Kaolin and halloysite projects

Bobalong consists of two granted exploration licences covering 116.61sqkm and is the most advanced asset with drilling and a scoping study completed at the Bill’s Middle and Tambellup East targets.

This previous work has indicated the potential to produce a high-value product that could be suitable for direct shipping ore export via the port of Albany about 133km to the south.

Pinnacle plans to start resource definition drilling imminently along with bulk sampling for product testing.

The nearby Holly project covers 268sqkm and includes historical drilling by CRA in 1995 that identified kaolin over a 10km by 4km area with depths of up to 35m.

Targeted drilling is planned upon completion of land access agreements.

White Knight and Camel Lake are both early stage projects that are adjacent to Andromeda Metals’ (ASX:ADN) high-grade kaolin-halloysite discoveries.

Both projects have an extensive exploration history with extensive recorded kaolin that was never followed-up.

 

 

 

This article was developed in collaboration with Pinnacle Minerals, a Stockhead advertiser at the time of publishing.

 

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.