Resources Top 5: A big gold takeover bid and Jerko Zuvela’s magic touch

+1Mozpa miner B2Gold will acquire neighbouring 668,000oz Mali gold explorer Oklo
Galileo says ‘Callisto’ discovery includes rhodium, which currently sells for $US15,500/oz
South African gold mine developer West Wits Mining locks in $75m financing facility

Here are the biggest small cap resources winners in early trade, Friday May 27.

OKLO RESOURCES (ASX:OKU)

+1Mozpa miner B2Gold will acquire neighbouring 668,000oz Mali gold explorer OKU for an implied 17.25c per share.

That’s a 127% premium to OKU’s last closing price, and premium to any closing share price over the past 12 months.

The implied consideration breaks down into 0.0206 B2Gold shares and A$0.0525 cash per Oklo share.

While long term shareholders would be taking a haircut on the deal, post-coup Mali is a fairly risky jurisdiction for a junior to be operating in.

The OKU board – which unanimously recommends the transaction – says the deal is “mutually beneficial”.

“The B2Gold proposal was welcomed by the Oklo directors and comes at an opportune time for Oklo shareholders to crystallise value and de-risk their investment in the company,” OKU Simon Taylor says.

“Whilst the Oklo team continues to see significant potential in the Dandoko Project and the region generally, Dandoko is at an inflection point and this transaction removes the risks associated with project development, future capital raisings and other risks faced by a junior gold explorer in a foreign jurisdiction.

“Considering B2Gold’s compelling offer along with the risks involved in Oklo pursuing a ‘go it alone’ strategy, the board has resolved that the opportunity to combine with a well-funded, substantial multi-asset gold producer represents a highly attractive outcome for Oklo shareholders.”

RAGUSA MINERALS (ASX:RAS)

(Up on no news)

Our new regular at Ressie Top 5 is now up an impressive 125% since buying some early stage lithium ground in the Northern Territory earlier this week.

The acquisition will see RAS create a ‘supergroup’ project area “comparable to neighbours Core Lithium (ASX:CXO) and Lithium Plus (ASX:LPM)”, RAS chair Jerko Zuvela says.

Zuvela is also director at gold-lithium minnow Discovery Alaska (ASX:DAF) – which also made strong gains this week — and managing director of near-term lithium miner Argosy Minerals (ASX:AGY).

Busy guy.

READ: Argosy Minerals’ Jerko Zuvela on why its near-production lithium project is built… different

GALILEO MINING (ASX:GAL)

GAL says the ‘Callisto’ discovery includes rhodium, one of the rarest and most valuable precious metals in the world currently selling for $US15,500/oz.

Assays from discovery hole NRC 266 show rhodium values up to 0.094g/t with average values across the 33m interval of 0.05g/t, GAL says.

“With step out drilling expected to commence next week we will now be including rhodium in the assay suite for any further sulphide rich intersections,” managing director Brad Underwood says.

“Based on the six drill holes completed so far at Callisto we anticipate more sulphide intersections in the next drill program and are hopeful that an increase in sulphide content will be matched by an increase in metal content.

“We are excited to be starting drilling again so soon after the recent discovery announcement and look forward to updating the market with results as they become available.”

Most global rhodium production is used in catalytic convertors, which control emissions in ICE and hybrid vehicles.

$315m market cap GAL is now up ~800% since first announcing the discovery at Callisto on 11 May.

WOOMERA MINING (ASX:WML)

(Up on no news)

Exploration across WML’s portfolio of WA lithium, gold and base metals projects will kick up a gear over the next six months.

A 10-hole, 1,700m drilling campaign wrapped up May 13 at the flagship ‘Mt Venn’ nickel-copper-PGE project, with results expected in 4-6 weeks.

Ground electromagnetics (EM) will now be completed at the ‘Wyloo Dome’ JV in the Ashburton prior to RC drilling to test gold targets.

Also in the June quarter, drilling and early stage geochemical (soil) sampling will get underway at WML’s lithium projects ‘Ravensthorpe’ and ‘Lake Dundas’.

The $15m market cap stock is up 15% year-to-date. It had $2.4m in the bank at the end of March.

WEST WITS MINING (ASX:WWI)

The goldie has secured an up to $75m ‘standby’ financing facility to provide working capital as it advances the 4.28Moz Gold Witwatersrand Basin project (WBP) in South Africa toward production.

This deal – which will see shares allotted to the financier every time WWI uses cash — is separate to the core debt funding program to finance the project construction.

The placements will also be at 95% of the VWAP of shares during the placement period, which seems pretty good.

“We are pleased to secure the agreement with North American investor SBC Global Investment Fund which provides the company flexibility to manage capital requirements whilst focusing on the longer strategic financing for development of the WBP,” WWI chair Michael Quinert says.

“The agreement extends the company’s reach into the North American market with the investor having a clear view of the strong upside potential offered by WWI’s marque 4.28Moz gold project.”

A DFS showed its first stage, the ‘Qala Shadows’ mine could deliver 663,000oz over a glacial 17-year mine life, with a 5.5-year payback period on its US$50 million development costs and peak steady state production of 53,000ozpa over a 10-year period.

The broader WBP would produce 1.57Moz of gold over a 25-year life of mine, with average steady state production of 80,000ozpa over an 18-year period, according to a scoping study.

$50m market cap WWI is flat year-to-date.