ASX Quarterly Wrap: New REE targets, an iron ore mine restart and a potash project sale

It’s the quarterly season again as the ASX market announcements page becomes increasingly flooded with update lodgements.

To save you the trouble of trudging through it all, we’ve wrapped up the highlights from some of the reports that caught our eye.

MOUNT RIDLEY MINES (ASX:MRD)

Drilling this quarter flagged two new priority prospects (Jody and Marvin)
Mia confirmed as a priority target for the project’s first drill out
Four previously identified prospects

The REE explorer completed a total of 234 aircore holes for 11,144m of drilling targeting clay-hosted rare earth element mineralisation at its Mount Ridley project in WA.

Drilling results from 175 holes drilled in 2022 identified two new prospects: Jody and Marvin, and confirmed Mia as the company’s first target for resource drilling.

Assays from Mia included 6m at 6,648ppm TREO from 57m including 2,726ppm MagREO.

Test work on 19 samples is in progress and subject to results, and a POW for infill drilling of Mia has been approved (once heritage and flora surveys are complete) to bring the drilling density down to a 400m x 400m grid pattern.

Separate POWs have been applied for and are currently being assessed, to enable drilling up to 9km north and up to 10km south of the Mia Prospect and as far south as the Marvin Prospect.

VARISCAN MINES (ASX:VAR)

Strong drilling results at San Jose mine and Buenahora
$1.85m capital raise attracts new major shareholder
An initial mineral resource estimate is planned

The company is continuing to evaluate mining restart potential at the San Jose zinc mine in Spain, posting some solid results during the quarter confirm thick, high-grade, sulphide zinc-mineralised lenses in the same style of mineralisation as the historic mine, including:

22m at 8.16% Zn + 0.23% Pb;
6m at 16.02% Zn + 0.71% Pb; and
9 m at 5.45% Zn + 0.07% Pb.

The company also secured a $1.85m capital raise which attracted a new major shareholder in natural resources-focused investor Zinc GroupCo who subscribed for $1.3m.

The company says ZincCo will support it to complete its planned concept study to assess the restart potential of the mine, with the immediate plan to publish a higher confidence Mineral Resource Estimate (MRE).

Cash at bank at the end of the quarter was $1.18 million.

CUFE (ASX:CUF)

JWD mining operations recommenced
Four shared cargoes totalling 71,341wmt exported
US$2,000,000 prepayment facility from offtake partner Glencore

The company recommenced mining at its JWD iron ore project in WA off the back off improved iron ore pricing, with four shared cargoes totalling 71,341wmt on a 100% JV basis exported during the quarter, despite a rainfall event in late March/early April resulted in flooding which the closed the mine access road to haulage for two weeks.

The company released an initial JORC resource at the Yarram iron ore project and an upgraded JORC resource at the Orlando copper deposit of 12.7Mt at 55.4% Fe using a 48% Fe cut-off, and 2.88Mt at 1.3% Cu and 1.4g/t Au based on a 1.0g/t Au equivalent, respectively.

“We are using those resources to feed the mine planning process across both sites, which will in turn establish the disturbance footprint required for our environmental approvals,” MD Mark Hancock said.

CuFe also secured a US$2,000,000 prepayment facility with JWD offtake partner Glencore International AG to fund working capital for the JWD restart with a US$400,000 repayment made against the facility during the quarter.

Cash available at the end of the March 2023 quarter was $3.6m.

DANAKALI (ASX:DNK)

Completion of sale of 50% Colluli interest
Looking for new potash and critical metals projects
Plans to distribute 90% of proceeds to shareholders

DNK wrapped up its sale of its 50% interest in the Colluli Mining Share Company (CMSC) to Sichuan Road and Bridge Group Co. for the Sulphate of Potash Project in Eritrea for US$166 million in upfront cash and deferred payments.

The company says its looking for suitable projects for investment of a portion of the funds received from the transaction in potash and critical metals (e.g. copper, lithium, gold, cobalt, tin and nickel), and may consider a diversified portfolio of exploration and development assets as part of its strategy.

DNK also plans to distribute approximately 90% of the net proceeds to DNK shareholders, however no formal decision has been made.

If the company does not identify a suitable new project, the shares of DNK will remain suspended from the ASX.

Consolidated cash on hand was A$170m as at 31 March 2023.

PEEL MINING (ASX:PEX)

PFS work for the South Cobar project is continuing
Underground mining studies and mineral resource update completed
$250,000 grant from NSW Government received

Pre-feasibility study (PFS) work for the company’s South Cobar project is continuing, with underground mining studies completed and the Mineral Resource Estimate (MRE) update released of 20Mt containing 216kt copper, 322kt zinc, 151kt lead, 22Moz silver, and 204koz gold.

Notably, around 14Mt (or 70%) of the MRE, including approximately 152kt of contained copper (or 77%) is in the Indicated Resource category.

During the quarter the company also received the first instalment of $250,000 towards the cost of the PFS from the NSW government Critical Minerals and High-Tech Metals Activation Fund.

“On the exploration side, Induced Polarisation (IP) surveys were completed at Wirlong and Iris Vale NE with promising results,” CEO & MD Jim Simpson said.

The company had $13.6m cash at bank at the end of the quarter.

CARAVEL MINERALS (ASX:CVV)

EPA environmental approval process underway
Independent metallurgical review highlighted flowsheet improvements
Lycopodium appointed lead engineer for the DFS

During the quarter the company kicked off borefield development to support a groundwater model for the environmental approval process and establish a water supply for its Caravel copper project in WA.

Plus, an independent metallurgical process review has identified “substantial opportunities” to enhance project value and confirmed the suitability of the process flowsheet ahead of the start of engineering for the DFS, CVV says.

The key outcomes included an incremental increase in process plant capacity of ~10% to 30Mtpa, the inclusion of a Molybdenum Recovery Circuit (MRC), the deferral of the Coarse Particle Flotation (CPF) circuit and an update to the overall process plant copper recovery. Based on these changes, forecast annual copper production increases from 60ktpa to ~65ktpa at steady state, supplemented by ~0.9ktpa of molybdenum production as saleable by-product.

Lycopodium Minerals was selected as the lead engineer for the DFS – which is scheduled for delivery in the first half of 2024.