Resources Top 5: A hat-trick of vanadium, gold and nickel winners
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Here are the biggest small cap resources winners in early trade, Wednesday June 23.
(Up on no news)
This South African vanadium project developer has been a dark horse performer in 2021, up ~110% year-to-date.
Yesterday, $30m market cap VR8 released a study on its flagship 18,500 tonnes per annum ‘Steelpoortdrift’ project (50%, heading toward ~74% ownership).
Highlights include a post-tax net present value (NPV) (100%) of $US1.2 billion, average annual cash flow of $US139 million, and very low operating costs of $US3.08/lb V2O5.
Current prices in the opaque market are bouncing around the $US8/lb to $US9/lb mark.
$200m in Steelpoortdrift construction costs will take just 25 months to pay back, VR8 says.
“The PFS has once again confirmed our belief that the Steelpoortdrift project is well positioned to become a significant high volume and low cost producer in the market,” VR8 chief exec Eugene Nel says.
“It’s also given the company a perfect platform to now progress the project further through more detailed design studies and ultimately construction and production.”
“With a number of potential optimisation opportunities having been identified during the PFS, we are confident that future studies will be able to progressively build on the foundations laid by the PFS,” Nel said.
The company has returned thick, high grade results – like 8m at 2.8% nickel – from drilling at its ‘Jejevo’ nickel DSO (direct shipping ore) project in the Solomon Islands.
All 26 holes hit nickel laterite mineralisation, the company says. A JORC resource assessment is now underway.
Nickel laterite ores from DSO operations – a low cost way to get into production — provide feedstock for nickel pig iron production suitable for Chinese stainless steel producers, Pacific Nickel Mines says.
Few alternative sources of nickel laterite ore globally exist outside Indonesia (higher jurisdictional risk) and the Philippines (lower grade) to satisfy demand from the domestic Chinese RKEF producers, the company said.
The $10m market cap explorer is up 20% in 2021 so far.
Venus (30% ownership) and JV partner Rox Resources (ASX:RXL) (70%) have increased ‘Youanmi’ gold project resources by 39% to 1.7 million ounces.
This includes the near surface, high grade ‘Grace’ discovery, which is now 109,000 ounces at an average gold grade of 7 g/t.
The $16 per ounce discovery cost is well below the industry average, Rox says.
“On the back of the resource upgrade, we will be commencing the Youanmi Mine Feasibility Study,” Rox managing director Alex Passmore says.
“Drilling will continue at Youanmi with a focus on the ongoing conversion of inferred material into indicated categories for both the Deeps and Near Surface Resources and extension of the Youanmi Deeps along strike and down dip.”
In addition, “regional grass roots exploration drilling will continue on our extensive tenement interests with the intent of making new discoveries in the area”, the company said.
Rox is up ~4% in early trade.
Small gold producer Troy has approval from the Guyana government to develop the 290,000oz ‘Smarts’ underground mine, part of the Karouni project.
The Smarts mine is expected to be the primary ongoing source of mill feed at Karouni, once it comes into production.
This approval is a pretty big deal. Permitting of the underground mine had been under way for some time, the company says.
“One key challenge for Troy is that there has never previously been an underground mine developed in Guyana and, hence, the Mines Department (GGMC) has no experience in this area,” it says.
Troy produced 2,140oz of gold in April.
(Up on no news)
This Chinese-backed shell is now up 230% since signing a deal with a mysterious Singapore consultancy called Cloud Securities in early June.
Cloud Securities – which doesn’t even appear to have a working website — ostensibly “specialises in assisting mining and exploration companies with their business development”.
As part of the deal, Cloud has agreed to bring to Zeus a minimum of three new mining projects for their perusal within 12 months of executing the agreement.