Ground Breakers: Big miners slide into pity party on hump day
Prices of a swag of base metals tumbled overnight while iron ore futures softened, presenting more challenges for ASX 300 miners already staring glumly at poor economic data out of locked down China.
Copper fell to its lowest price point since the end of 2021, shaving 3.7% to drop to US$9410/t, nickel lost 2.5% to US$30,975/t, zinc dropped below the US$4000/t mark with a 3.5% slide and aluminium came off 4.6% to US$2911/t.
Singapore iron ore futures came off more than 2% yesterday and are in the red again today, paying US$142.80/t.
Unusually for their crazed 2022 performance second tier lithium stocks were hammered, with market darlings Sayona Mining (ASX:SYA) and AVZ Minerals (ASX:AVZ) dropping 8.87% and 7.83% respectively. Ioneer (ASX:INR), which owns a sedimentary hosted lithium deposit at Rhyolite Ridge in the USA, fell 4.76%.
AVZ’s dip came after it announced the ministerial decree to award the mining licence at its Manono lithium and tin project in the Democratic Republic of the Congo to Dathcom Mining SA, a subsidiary of which AVZ holds a 75% interest.
Manono is one of the world’s largest pegmatite projects, containing the large and high grade Roche Dure resource.
“The receipt of the Ministerial Decree to award the Mining Licence is leading to a watershed moment for AVZ and our partners, with the official award of
the Mining Licence from CAMI expected in a matter of days,” AVZ managing director Nigel Ferguson said.
“This paves the way for AVZ to start developing what is arguably one of the most important new mining projects in the world that will significantly contribute to the global green energy transition, while also uplifting the lives of the Congolese people who will contribute and receive sustained benefits from the Project for many decades to come.”
Bellevue (ASX:BGL) is around a year away from tasting those sweet gold bars from its namesake mine in WA.
The project near Leinster was famously picked up for a pittance by Bellevue a few years ago back when it was a reformed coal explorer known as Draig Resources.
With a new management team the project owners tested a theory that gold actually existed beyond a fault thought to have stopped the flows of high grade gold through the mine.
That has paid off in spades. The mine now boasts 9.8Mt at 9.9g/t for 3.1Moz of the precious metal. That is very high grade for this day and age, when most of the really good stuff has already been mined.
New drill results are pretty tidy, including 6.7m at 16.5g/t from 477.7m and 4.7m at 7.2g/t from 538.7m at the Deacon North ore body.
While the overall resource hasn’t grown substantially, Bellevue has increased the grade and size of its indicated resource from 1.4Moz at 11g/t to 4.6Mt at 11.2g/t for 1.7Moz.
That’s important because the indicated resource is the portion that can be converted to economic ore reserves in a mine plan, the stuff that can actually be mined out.
“This increased Indicated Resource is expected to lead to increased Reserves and a longer mine life compared with the already-impressive metrics in the FS2 study,” Bellevue managing director Steve Parsons said.
“Work on the optimised Reserve and mine life is well advanced and we expect to complete these studies within weeks.”
Bellevue has a probable ore reserve of 1.04Moz at 6.1g/t gold, with an initial 8.1 year mine life based on life of mine production of 1.56Moz at 6g/t.
Its first five years of operations is expected to deliver 200,000ozpa at costs of $992 an ounce.