Resources Top 5: Another ionic clay rare earths monster awakens

Victory Goldfields says North Stanmore ionic clay rare earths discovery “developing into a project of significant scale”
Lycaon Resources buys project nearish WA1 Resources’ big niobium-REE discovery
Winsome Resources to raise $6.8m at $1.67 a share – an unprecedented 98% premium to the last closing price

Here are the best performing small cap resources stocks in morning trade, Tuesday November 15.

VICTORY GOLDFIELDS (ASX:1VG)

1VG says its ionic clay rare earths discovery at North Stanmore is “developing into a project of significant scale”.

The stock listed mid-2021 with a collection of 52 historic gold mines in the Cue region of WA, but soon diversified into lithium, IOCG (iron oxide copper gold) and rare earths exploration.

It completed the pivot to ‘mostly rare earths explorer’ after announcing a ‘high value critical rare earth element discovery’ at North Stanmore (also near Cue) in July this year.

New assay results from a recently completed 118-hole AC drill program confirm REE paydirt ~4km from this initial discovery.

Notable hits include 16m at 2155ppm TREO from 21m, including:

6m at 4683ppm TREO,
2m at 9681ppm TREO, and
1m at 9746ppm TREO from 21m.

That’s high grade for a clay deposit.

The mineralisation tested so far also includes a high proportion of heavy REEs (34%) which are up to 350% more valuable that light REEs, the company says.

The deposit remains open in all directions. A new 10,000m drilling program will kick off “immediately”.

“It is a very exciting time for the company with the continuation of our rare earth element discovery at North Stanmore that is developing into a project of significant scale,” 1VG exec director Brendan Clark says.

“Rare earth element grades and critical metal ratios at this level, potentially make the discovery one of the most valuable ionic clay hosted rare earth systems compared to our peers based on our high basket price.

“Victory’s board has great confidence in these results and has fast-tracked a further 10,000m of drilling across the project in search of further REE mineralisation and to infill the previous drilling program.”

LYCAON RESOURCES (ASX:LYN)

LYN is buying a project nearish WA1 Resources’ (ASX:WA1) big niobium-REE discovery in the West Arunta region of WA.

The Stansmore carbonite project includes a regionally prominent 700m long magnetic feature analogous to WA1’s discovery and Encounter’s (ASX:ENR) nearby Worsley prospect.

Carbonatites are important sources of niobium and REEs and host all three of the world’s operating niobium mines as well as Lynas Rare Earths’ (ASX:LYC) world class Mt Weld deposit.

Historical drilling at Stansmore by BHP in 1982 intersected intrusives and strong carbonate alteration that may be related to REE-carbonatite mineralisation, LYN says.

But the mining giant was looking for diamonds and so walked away from the project. No exploration has been conducted since.

Importantly, the six shallow RAB holes drilled at Stansmore by BHP to a max depth of 12m showed prospective geology is under very shallow cover of ~ 5-10m, “which further enhances discovery potential”.

“The identification of a mineralised carbonatite intrusion by WA1 is a significant development for the West Arunta region and given the Stansmore prospect shares many similarities to WA1 and Encounter’s discoveries this is an exciting opportunity for Lycaon to explore a similar setting for rare earth carbonatites and IOCG type deposits,” LYN technical director Thomas Langley says.

In October, WA1 10-bagged after hitting thick, high-grade niobium in its first hole in the West Arunta; a remote, lightly explored, but highly mineralised region on the WA/NT border.

Niobium is mainly used to make steel better, but also has growing uses in lithium-ion batteries, intelligent glass, solar panels, 5G tech, and nuclear energy.

Ferroniobium metal (65% Nb) currently sells for ~US$45,000/t.

READ: Has WA1’s niobium-rare earths discovery unlocked a new mineral province? These ASX explorers are about to find out

COOLABAH METALS (ASX:CBH)

This explorer listed in June with two projects in the Lachlan Fold Belt (NSW) and one in Mount Isa (QLD). Results from a drilling campaign at the Gunpowder Creek project in QLD are expected before the end of November.

Today it announced it was issuing loyalty option to shareholders “to recognise the support and loyalty the company has received from its shareholders to date, many of them having committed their capital at or before the company’s initial public offer”.

The deal is one loyalty option for every two shares held by eligible shareholders at 5:00pm (WST) on Monday, 21 November 2022 at an issue price of $0.001 per Loyalty Option.

The Loyalty Options will be exercisable at $0.20 and expire on or before the date that is three years from the date of issue.

Which is a decent bet. The stock is currently at 12.5c per share.

WINSOME RESOURCES (ASX:WR1)

The red-hot lithium stock will raise $6.8m at $1.67 a share – an unprecedented 98% premium to the last closing price.

It will be raised using so-called ‘flow-through shares’ provisions under Canadian tax law. The shares will be immediately on-sold through a block trade agreement “to select high-quality domestic and offshore institutional investors”.

WR1 says flow through provisions enables it to significantly minimise dilution while ramping up exploration programs at its Cancet and Adina projects.

“It allows us to raise capital at a premium price without the level of dilution that would occur via a standard, share placement offer,” managing director Chris Evans says.

“It also allows Winsome to facilitate the introduction of select high-quality institutional investors to the company’s share register.

“The funds raised will enable us to continue the exploration work at Cancet and Adina without delay, strengthen cash reserves and work towards our intention to announce maiden resources next year.”

WR1 caught a rocket after announcing a “significant pegmatite intercept” late October at the Adina lithium project in Canada.

All up, 160m of pegmatite was intercepted in drilling below the recently discovered, well mineralised Jamar outcrop, it said late October.

A 12,000m drilling program currently underway will culminate in a maiden resource at the Adina and Cancet projects in 2023.

LION ONE METALS (ASX:LLO)

(Up on no news)

In June, the TSX-ASX listed stock briefly spiked to ~2-year highs after uncovering a major new gold ‘feeder structure’ beneath the current ~650,000oz resource at the ‘Tuvatu’ project in Fiji.

CEO Walter Berukoff said: “I am confident that Tuvatu will one day fall in the ranks of notable multi-million-ounce Au deposits such as Porgera and Vatukoula.”

Porgera – which produced +20Moz between 1990 and 2017 — is the second largest mine in Papua New Guinea and one of the world’s top 10 gold mines.