Resources Top 5: Iron ore miner climbs to 13-year high, cheap battery metals stocks catch a bid
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Here are the biggest resources winners in morning trade Monday, February 28.
A Chinese business with “considerable investments in the lithium sector” will pour $2.85m into the coffers of early-stage lithium-gold explorer QXR.
An MOU (non-binding deal which comes before a binding one) to work together on exploration, development, and potential offtake agreements for all QXR’s lithium projects in WA was also signed.
The Chinese company in question – Suzhou TA&A Ultra Clean Technology Co – is the largest investor (75%) in lithium hydroxide producer Yibin Tianyi, together with China’s largest EV battery manufacturer CATL.
Yibin Tianyi’s objective is to become one of the largest lithium hydroxide producers in the world.
“This is an excellent development for our company, a strong vote of confidence in our lithium exploration projects, and it brings an experienced and large lithium sector investor onto our register,” QX chairman Maurice Feilich says.
“As well, their desire to collaborate with us on project exploration, development and secure future offtake for any lithium we discover on our projects delivers huge value at multiple levels to QXR.
“We now have the added financial flexibility to fast-track and scale up exploration activities in Western Australia as well as continuing to invest in ongoing trenching and drilling of our Drummond Basin gold assets where we are achieving excellent results.”
QXR has almost come full circle. It used to be a Hipo Resources, a stock touting an experimental Ukrainian battery tech which failed to deliver the goods.
It then moved into gold, before progressively picking up 215sqkm of early-stage lithium ground in the Pilbara over the past six months.
The $28m market cap stock is up 27% year-to-date.
(Up on no news)
GRR’s +50-year-old ‘Savage River’ magnetite mine produces an ultra-high grade pellet concentrate which attracts well over benchmark prices from steelmakers.
While the Pilbara iron ore miners were seeing prices collapse and discounts rise in the December Quarter, Grange was humming its own tune.
Its realised prices increased from US$153.09/t ($206.80/t) in the September quarter to US$164.14/t ($226.71/t) in the December quarter.
Since the end of the financial year GRR has recommended the payment of a 10c per share final dividend of $115.7 million.
This represents a total of $254.6 million (22c per share) fully franked dividend for the year-end 31 December 2021.
GRR is looking at a 10-year underground mining option at Savage River and a second operation at ‘Southdown’ in southern WA and “will provide additional information on these two projects when studies are completed.”
The $1.1bn market cap company — currently at ~14-year highs — is up 21.5% year-to-date.
This battery metals stock has produced up to 96.8% flake graphite in concentrate from the advanced ‘Lac Rainy’ project in Canada.
“Outstanding,” says MLS, which will now ship some of this concentrate to Germany where it will be tested to determine its suitability for use in lithium-ion batteries.
In 2020, Metals Australia completed a Scoping Study (the first proper look at the economics of building a project) when graphite was in the crapper.
It demonstrated the potential of Lac Rainy to generate high-operating margins and capital payback by year 4 of a 14-year mine life, producing nearly 100,000t of concentrate per annum at full production.
MLS is currently completing advanced metallurgical test work which will allow it to reach prefeasibility study (PFS) level “as well as carry out marketing of the high-quality and high-purity Lac Rainy graphite concentrate to end-users across North America and Europe”.
MLS also recently kicked off a 3,500m RC drilling program at its early stage Manindi lithium project in WA.
The program is expected to take 2-3 weeks to complete and will target the entire 500m strike length of the recently discovered Foundation Pegmatite.
(Up on no news)
This busy WA junior is juggling several balls right now.
Two of these are lithium related – the wholly owned ‘Coolgardie West’ project, and the ‘Nepean’ joint venture with Auroch Minerals (ASX:AOU).
Last week it completed a $2.78m placement which will fund this year’s “aggressive” program of exploration and development.
“Our Flagship Earaheedy [base metals] project will be our primary focus, where we will be prioritising over 30 drilling targets generated from our EM program undertaken in 2021,” LSR chairman Ross Taylor says.
“It will fund the continuing exploration and scoping studies that are being undertaken at the historic Nepean Nickel Mine, where we hold a 20% interest, and our drilling programs for lithium at our Coolgardie West project and the drilling at our Jubillee Well and Bulong gold projects.
“Shareholders can look forward to steady newsflow, starting with the results from our October 2021 drilling at our Neds Creek JV which are expected by the end of February.”
(Up on no news)
In early Feb this $11m market cap gold-kaolin-lithium explorer defined a +1.5km-long lithium cluster with augur drilling at the ‘Rankin Dome’ project in WA.
Rankin Dome is ~130km from the world class Mt Holland Lithium project “in the same terrain”, KGD says.
Augur drilling is cheap, fast but shallow (up to 25m deep), and is used in early-stage geochemistry reconnaissance work.
A bunch of drilling results are pending across KGD’s gold and kaolin projects.