Resources Top… 4: Galileo, Galileo, Galileo, Figaro, Magnifico-o-o-o-o
I see a little silhouetto of a surge in Galileo Mining, the sun around which the stock-picking universe is circling this morning after the Creasy backed explorer popped up unannounced to deliver a maiden resource for its Callisto PGM discovery.
Unlike the unique, and larger, Gonneville find Chalice Mining (ASX:CHN) made to draw the Aussie market’s attention to palladium and platinum (known as platinum group metals) a few years ago, Callisto is more conventional.
Located near Norseman in WA’s Eastern Goldfields, where gold was mythically uncovered by an unruly horse of the same name in 1894, Galileo says Callisto is the first discovery in WA in the style of the platreef deposits which dominate global platinum supply in South Africa.
Callisto is far more modest than Chalice’s monstrous Julimar deposit. Floated from tenements held for a long time by billionaire prospector Mark Creasy, the exuberance that sent the stock soaring to over $1.50 last year has since subsided.
It’s down over 50% in 2023, but a more than 20% surge this morning shows the resource update has brought investors running back in.
The maiden indicated and inferred mineral resource estimate including 17.5Mt of ore at 1.04g/t 4E — that is palladium, platinum, gold and rhodium, 0.2% nickel and 0.16% copper for a 2.3g/t palladium equivalent or 0.52% nickel equivalent grade.
All up, that’s 585,000oz of 4E, 35,000t nickel, 28,000t copper, with 8Mt or 46% of the resource inside the indicated category (high enough confidence to be converted to reserves at the right commodity price) with a grade of 2.5g/t PdEq or 0.58% NiEq.
Galileo tabled the resource from 147 drill holes for almost 40,000m of drilling, but says it remains constrained by pit optimisations.
The explorer already boasts a valid mining lease within 15km of Norseman and controls around 255km2 of prospective ground around the find, and is still drilling for similar discoveries in the PGM province 5km to the north and 4km to the south.
“The nature of the mineralisation at Callisto is analogous to the Platreef deposits in South Africa where several deposits occur over a strike length of tens of kilometres. Applying this knowledge, we will broaden our search for more discoveries starting with the prospective areas at our North and South Callisto prospects,” GAL MD Brad Underwood said.
“Ultimately, we believe this search space will encompass the full 20km of the prospective host rocks at the Callisto trend and the further 12km of prospective strike length at the Mission Sill prospect where similar geology has been intersected in drilling.
“We believe the potential for new discoveries within our project area is high and will be undertaking extensive drill campaigns aimed at generating new discoveries.
“The next drill program will test targets at both South and North Callisto prospects and is scheduled to commence in late October. We very much look forward to getting these drill campaigns underway in this exciting new mineral province.”
South Africa’s platreef deposits supply around 75% of the world’s platinum, 40% of its palladium and over 80% of its rhodium, highlighting the potential of the style of mineralisation and the supply security concerns over the commodities, used in catalytic converters in internal combustion engine cars as well as electrolyser membranes in green hydrogen production.
Mark Creasy controls around 28% of Galileo, valuing his share at ~$16m, while IGO (ASX:IGO) also holds a significant stake of over 8%.
(Up on no news)
Our intrepid columnist Barry FitzGerald is kind of a legend around these parts and his Garimpeiro column is must read stuff for the resources investor.
We’ll chalk it up to good fortune though that his latest profile subject Leeuwin Metals (ASX:LM1) is on an absolute tear today, up 26% before midday on no news outside of the annual report that’s been sitting in investors’ inboxes since Wednesday.
The Glencore backed nickel and lithium explorer is among the large crowd of companies sinking the drill bit into hallowed turf in Canada in the hunt for battery metals, focused on the relatively overlooked territory of Manitoba.
Its big games are the Cross Lake lithium project, which happens to auspiciously include some ground known as “Spodumene Island”, along with the William Lake nickel sulphide project.
It’s all around 120km south of Thompson, one of Canada’s famous nickel districts.
“William Lake sits on the southern extension of the famous Thompson nickel belt and was explored in the past by some big names in the nickel game. It is considered advanced because of the database that comes from the 174 diamond holes drilled in the past,” Garimpeiro himself notes.
“Advanced all right, but there has been little on the exploration front since for many years, something Leeuwin is now turning around to its advantage using all of the latest whizz-bang exploration techniques, and with Glencore proving technical input to boot.
“Recent drilling identified a new high-grade zone extending from a known mineralisation over a 2km trend. Best results included 6.5m grading 2.56% from 439.2m and followed on from an earlier assay from another drill hole of 21.9m at 1.02% nickel.”
IMI is on the hunt for large-scale lithium, nickel, and gold deposits in the Pilbara and the Goldfields of WA.
Like many ASX explorers it has struggled for traction in 2023, down 55% since hitting a peak above ~30c/sh December last year.
It’s also been quiet on the news front following a busy first half, which included results from maiden drilling at the Tambourah South lithium project, a maiden nickel, copper, zinc drill program at Hillside, and a gold drilling program at Victor Bore, Great Northern and Barlow’s Gully in the Goldfields.
IMI also pulled up some anomalous rare earths in drilling at Victor Bore, which is near a number of significant projects including Lynas Rare Earths’ (ASX:LYC) Mt Weld mine.
While these programs have been promising, they lack the spectacular results and/or sexy nearology that investors crave in these trying times.
So, what’s coming up?
In August, IMI said more drilling was planned at Tambourah South before the end of the year to test the most promising lithium-pegmatite targets.
Assay results are pending are also from that June drill program at Hillside.
Syrah Resources picked up a tidal wave of interest last week after a year of struggles at its Balama graphite mine after UBS ratcheted up its long term outlook for battery grade flake graphite to US$850/t.
As of Friday, 94% carbon 100 mesh graphite was picking up US$568/t out of China.
The miner and hopeful US anode materials producer is down over 70% this year, falling well below our $500 million Monster or Mouse hurdle.
But recent market movements have given hope. It has secured commitments for a number of low cost loans and grants from the US Government to support the Balama mine in Mozambique and its planned expansion of the Vidalia anode materials plant in Louisiana, from which it plans to supply Tesla with local Yankee Doodle Dandy battery materials for its EVs.
It also expressed increased confidence in the natural graphite market today in a statement refuting media commentary that it was stockpiling rather than selling its material.
“Syrah Resources Limited notes that the Australian Financial Review published an article
on Sunday, 1 October 2023, which incorrectly stated that the Company ‘continues to mine and stockpile rather than sell output’,” Syrah said.
“A production campaign has been undertaken at Syrah’s Balama Graphite Operation in Mozambique and natural graphite sales and shipments were completed, during the September 2023 quarter. Ongoing strength in global electric vehicle sales has seen increased anode production in China and improved natural graphite demand recently.
“Further information on Balama production, as well as natural graphite sales and shipments, will be released with the Company’s September 2023 Quarterly Activities Report on Tuesday, 17 October 2023.”
An interesting read that’ll be.