• Larvotto Resources recently raised $3.4m in a royalty, equity and offtake (REO) deal to accelerate lithium exploration
  • Copper-gold focused Resolution Minerals raised $1m to acquire a ~5% stake in a US focused hard rock lithium explorer
  • Also up on no news: Future (palladium, nickel), Burgundy (diamonds) and Peak (rare earths)

Here are the biggest small cap resources winners in early trade, Tuesday October 18.

 

LARVOTTO RESOURCES (ASX:LRV)

(Up on no news)

LRV recently raised $3.4m in a royalty, equity and offtake (REO) deal to accelerate lithium exploration at the 690sqkm Eyre project in WA.

Eyre is under-explored for lithium, but recent work by project developer Liontown Resources (ASX:LTR) in the area has gained significant attention, LRV says.

The REO was inked with Canadian-based Lithium Royalty Corp (LRC) which will acquire a newly created 1% gross revenue royalty payable if any lithium is extracted or sold from Eyre.

They will also subscribe for ~11m new shares at an issue price of $0.18 to raise $2m – a small 10% discount to 10-day VWAP — and acquire a 20% life of mine offtake right for lithium from Eyre for an extra $700,000.

LRC also holds royalty investments in big lithium players like Core Lithium (ASX:CXO), and Sayona Mining (ASX:SYA).

The remaining $1.8m of the equity investment is being taken by Waratah Capital, which manages over CAD$4bn in assets and is the founding sponsor of Lithium Royalty Corp.

$11m market cap LRV is up 30% on its December 2021 listing price of 20c per share.


 

PEAK RARE EARTHS (ASX:PEK)

(Up on no news)

PEK’s main focus is the NdPr-rich Ngualla rare earths project in Tanzania and the Teesside refinery in the UK.

There is the expectation that demand for magnet rare earths, the main two being neodymium and praseodymium (NdPr), will increase rapidly alongside growth in the EV and wind power sectors.

PEK’s vertically integrated project is currently the subject of a BFS update – the most advanced of all project studies – which should be released imminently, the company says.

“It is expected that the BFS Update will be finalised and announced during the next 6-8 weeks, together with an update on the status of negotiations on a Framework Agreement and potential offtake marketing arrangements,” the company said August 31.

Do the maths.

In February, Chinese rare earth company Shenghe Resources acquired a 19.9% interest in PEK at A$0.99 per share: a 24.5% premium to the last closing price.

The $100m market cap stock is down 45% year-to-date.

RESOLUTION MINERALS (ASX:RML)

(Up on no news)

Earlier this month the copper-gold minnow raised $1m to acquire a ~5% stake in Midwest Lithium, a US focused hard-rock lithium explorer currently acquiring assets in South Dakota.

“The company is very excited to be able to take this opportunity to invest in a quality hard-rock lithium asset in a top mining jurisdiction,” RML managing director Steve Groves says.

“Along with the upcoming drilling program at the Wollogorang copper project, it is another step in advancing our new energy metals strategy and creating tangible value for RML shareholders.”

RML’s projects include Wollogorang and Benmara in the Northern Territory (copper), and 64North in Alaska (gold).

The explorer has inked a couple of JVs over Wollogorang and Benmara with copper producer, Oz Minerals (ASX:OZL), which will pour in up to $9m in exploration funding over the next five years.

The $18m market cap stock is up 40% year-to-date.


 

BURGUNDY DIAMOND MINES (ASX:BDM)

(Up on no news)

BDM is one of only three diamond stocks on the ASX.

The aspiring end-to-end diamond company – from mining though to retail — owns the Ellendale Project in WA, mothballed in 2015 and famous for its brilliant yellow stones.

In September, it recovered its first stone from Ellendale, a little 1.51ct beauty.

BDM also has the Naujaat project in Canada and exploration projects in Botswana and Peru.

The company recently launched the “ultra-luxury” diamond brand, Maison Mazerea, and inked a profit share deal with independent jeweller Solid Gold Diamonds.

BDM managing director Peter Ravenscroft said all the pieces are now in place to grow the diamond business, from discovery to design.

“We are starting to generate revenue from our sales agreements and, while it’s still early days, the runway for growth and ongoing, increasingly lucrative diamond sales is genuinely exciting,” he said October 13.

The $75m market cap stock is flat year-to-date.


 

FUTURE METALS (ASX:FME)

(Up on no news)

FME has just started a new exploration drilling program at its flagship 6.9Moz Panton platinum group metals (PGM)-nickel project in northern WA.

“A number of high-quality targets have already been generated from the review of historical data and the ground EM survey currently underway, with the diamond drill rig set to start testing these in the coming days,” boss Jardee Kininmonth said October 11.

“Additional targets are expected over the coming weeks on the back of the EM survey team covering the entire basal contact and the Keel Zone, as well as from the completion of the gravity and magnetics modelling.”

The drilling is expected to run until late December, it says.

The $41.5m market cap stock is down 26% year-to-date.

Featured Companies

You might be interested in