Resources Top 5: Copper lives! GreenTech surges 170pc after thick hit
Here are the biggest small cap resources winners in early trade, Wednesday May 3.
GRE pulled up a 19m thick copper-rich zone – with grades up to 5.4% — at the Austin prospect, part of the wider Whundo project in northern WA.
Austin sits below the Whundo East resource, which is part of a combined 6.19Mt @ 1.12% Cu, 1.04% Zn across the project area.
The new assays indicate a “threefold thickening” of the Austin mineralised zone, which GRE says is consistent with Austin being a separate mineralising event to the overlying Whundo East resource.
Based on the footprint of the conductor, the company reckons Austin could potentially eclipse Whundo East in size.
This new hole also hit bonus gold (2m @ 1.35g/t Au from 178) and cobalt (6m @ 0.073% Co from 226m).
The Whundo and Austin deposits are shaping up to be a significant copper project in WA, says GRE exec Thomas Reddicliffe.
“I am confident we will be able to continue to expand the copper resource from our recently reported ~6Mt,” he says.
“The project also has the additional bonus of gold, cobalt and zinc which are key metals in high demand.”
Further results from the drill program will be reported shortly. Plans are also underway for a wider drilling program to increase the resource.
VR8 is now at the pointy end of development at one of the world’s largest vanadium deposits, Steelpoortdrift, located within the famous Bushveld Complex in South Africa.
It has now inked an investment and offtake deal with Chinese co Matrix Resources, a subsidiary of ~$3bn Hong Kong listed nickel stock Lygend Resources.
Matrix will acquire a 9.99% stake in VR8 for ~$6m, which represents a big 40% premium to the 30-day volume weighted average price (VWAP).
The cash will be used towards progressing plant design, completing additional technical work, and growing the operations team as the company moves towards an all-important Final Investment Decision in late 2023.
Meanwhile, Matrix also has exclusive rights to negotiate an offtake of 40% of vanadium products produced from the Phase 1 operations at Steelpoortdrift over a 10-year term.
Mining projects often lock in offtake deals to attract project financing.
A DFS on Steelpoortdrift released October last year envisaged post tax NPV 7.5% of US$1.05bn and IRR of 42% over a 25-year life.
It would take 27 months to pay back pre-production capex of US$211m, says VR8, which now has an increased project stake of 86.49%.
The $45m capped stock is up 55% year-to-date.
(Up on no news)
Another South Africa focused stock nearing a development decision is WWI, which is aiming for first gold pour at the 4.28Moz Witwatersrand Basin project (WBP) in Q4 this year.
In April, WWI received approval from South Africa’s Joburg City Power for a 7.5MVA power supply to its WBP’s Phase 1 Qala Shallows mine.
The approval of a 7.5MVA power supply is expected to reduce the DFS’ assumed timeline by six months or more, resulting in lower energy costs during the critical construction and build-up of the mine’s production.
Phase 1 production will average 55,000ozpa over an initial 10 years, at very good all-in sustaining costs of US$962/oz.
That culminates in pre-tax NPV and IRR of US$180m and 33%, respectively, at a conservative gold price of US$1750/oz.
Peak funding requirements are US$63m. The company says it is “in advanced discussions with multiple funders” to secure the optimum funding solution for the WBP.
A study on Phase 2 production up to 200,000ozpa is scheduled for this year.
The $30m capped stock is down marginally year-to-date. It has $2.2m in the bank and a $75m standby equity capital facility.
(Up on no news)
More gains for one of 2023’s biggest small cap movers, which rerated on a $US300m non-binding offtake and funding deal with bullion dealer and major shareholder Quantum Metal Recovery Inc in March.
This cash – paid over 30 months against future production ounces — would cover development of its 3Moz ‘Bau’ project in Malaysia’s Sarawak region.
BEZ has received initial payment of US$2m from Quantum ahead of finalising the offtake funding facility.
It is entitled to a further US$3m upon execution of the agreement, expected very soon.
The company is now updating an old feasibility study completed back in 2013, with initial results due in the second half of 2023.
Pilot production is also pencilled in for later this year.
(Up on no news)
S&P Global thinks demand for copper could double from 25Mt in recent years to 50Mt by 2050.
There would have to be a copper discovery equivalent to 5-10 Escondidas (1Mtpa of metal) to fill in the deficit, COD boss Chris Stevens told Stockhead in March.
COD has been bouncing around on volume since releasing a scoping study for its Emmie Bluff copper-cobalt deposit at the Elizabeth Creek project in South Australia’s Gawler Craton.
The project would deliver 317,000t of copper and 14,400t of cobalt over 14 years.
That’s an estimated $5.7 billion of revenue at average copper prices of US$8800/t and cobalt prices of US$60,627/t, with an NPV of $570m and internal rate of return of 26.5%.
It’s a big project that doesn’t account for Emmie Bluff Deeps, a potentially massive IOCG find which briefly sent the stock into the stratosphere in 2021.
Iron oxide copper gold ore deposits (IOCG) — like BHP’s Olympic Dam mine or more recent Oak Dam discovery — can be tremendously large, and simple-to-process concentrations of copper, gold and other economic minerals.
So far, COD has only intersected high-grade, but small scale “conduits” at depth. The motherlode is still to be found.
However, a recent ANT survey has defined a new structure to target, where larger scale mineralisation may have dropped out into a full-scale IOCG, the company said last month.
This, together with results from a recently completed tight-spaced gravity survey, is expected to provide detailed drill targeting locations for the next phase of drilling at Emmie IOCG.
The $50m capped stock is up 30% year-to-date. It had ~$6m in the bank at the end of March.