Leo is showing the way for other small caps to make it big. Image via Getty.
Mining
Here are the biggest small cap resources winners in early trade, Tuesday June 20.
Not quite a small cap anymore, but we remember when it was – and a testament to why a litany of resources juniors do what they do.
After bagging a $106m investment from Chinese battery giant Ganfeng three weeks ago, Leo has gotten straight on the tools and upgraded the MRE of its Goulamina lithium project in West Africa by 48.2%.
Goulamina now has a resource of 211Mt @ 1.37% Li2O, and the explorer reckons that makes in the world’s fifth largest spodumene deposit.
Leo MD Simon Hay said the significant resource upgrade confirms the outstanding scale, high-grade nature, and further growth potential of Goulamina.
“An increase at Goulamina of 68.6Mt from a very moderate drilling campaign is a fantastic outcome, [with] a scope for additional growth as the deposit remains open at depth and along strike, creating new drilling targets for the geology team.
“This significant upgrade also supports the possible extension of the 23-year mine life of the Goulamina project and the recent agreement with Ganfeng.”
A key T&C of that handshake with Ganfeng – which now owns 9.9% of the company – is for the explorer to conduct an engineering study into raising Stage 2 capacity to 500,000tpa, which would propel Goulamina to 1mtpa operation.
Currently, it’s forecasting an initial 506,000tpa of spodumene concentrate in the first half of next year, increasing to 831,000tpa as part of Stage 2, so this would be another significant increase.
Leo said results from the MRE upgrade will flow into the planned ore reserve estimate upgrade, scheduled for completion in August.
Investors sipped up the news from the now $1.13 billion market-capped explorer, with shares rising ~7% in early trade today to $1.15.
BTR is set to become a rank-and-file gold producer in the next few weeks after it confirmed mining operations will restart at the Menzies gold project.
Mobilisation is planned for late July, with first material to be produced from its Selkirk gold mine in August.
In a JV with BML Ventures – which will supply personnel and equipment – gold from Selkirk will be processed through St Barbara’s (ASX:SBM) Gwalia processing plant.
The company will use the early cash flow from the production to advance its other near-term gold assets at Menzies and Laverton, including Cork Tree Well, which is undergoing an update of its mineral resource estimate.
BTR MD Alex Rovira said the Selkirk JV with BML signifies the first production for Brightstar that will generate meaningful free cash.
“The funds will be utilised to organically fund additional exploration and development efforts underway across the broader portfolio, which contains 965,000oz Au JORC resource,” Rovira said.
“The mineral resources contained within Brightstar’s Menzies gold project presents a significant opportunity for Brightstar to extract value which will assist to fund larger-scale development endeavours underway to create a genuine WA gold developer with meaningful scale through Brightstar’s existing processing infrastructure and robust resource base in WA’s goldfields region.”
Shares in the $15.7m market-capped gold developer rose 30% in early trade to 1.3c.
Arafura is another step closer to funding the development of its Nolans rare earths project in the NT with the receipt of “in-principle support” for up to US$300m ($437.8m) in debt financing.
The Letter of Interest from Canadian export credit agency Export Development Canada for the funding is based on General Electric’s support for the project, which is focused on producing neodymium and praseodymium (NdPr) used in the fabrication of permanent magnets.
GE is also working with Arafura to supply cogeneration power plant technology and associated equipment for Nolans to support the project’s processing facility.
Binding offtake agreements have also been reached with two customers, together accounting for about 53% of the targeted 85% annual production from Nolans.
Nolans is expected to produce 4,325t of NdPr oxide per annum over a whopping 40 years, with production likely to commence in 2025.
ARU has a market cap of $734m, with shares currently up 3.73% to 36c per share in morning trade.
Resources-related battery material producer Talga has received €150m ($250m) in funding for its Vittangi anode project from the European Investment Bank (EIB).
Vittangi will use 100% renewable electricity to produce 19,500tpa of green anode (flake graphite) for lithium-ion batteries from an integrated mine and refinery operation in Sweden’s north.
This will help alleviate Europe’s reliance on importing battery materials for EVs and other associated products.
Talga is projecting debt gearing of up to 60%, and the funds from EIB will form part of the debt financing package.
Shares in the $513m critical minerals player are up more than 10% so far today, trading at $1.42.
(Up on no news)
Since finding new higher-grade zones at its Kharmagtai copper-gold project in Mongolia 10 days ago, XAM shares have almost doubled in value.
The company is in a JV with Chinese miner Zijin Mining and has just completed a 15,000m Phase 1 drilling program – halfway through its total 30,000m campaign – uncovering grades materially better than the current resource estimate for each of the Stockwork Hill and White Hill deposits.
Drilling at Stockwork Hill intercepted a zone grading 34m @ 1.10% Cu and 0.10g/t Au (1.15% CuEq) from 285m, significantly exceeding the 2021 MRE block model prediction for 0.3% CuEq mineralisation.
Four diamond drills are currently spinning at Kharmagtai to increase the MRE which currently sits at 3Mt CU and 8Moz gold (1.98Mt CuEq Indicated, 2.33Mt CuEq Inferred).
XAM said it aims to complete a PFS soon, with an aim to make a decision to mine in Q4 2024.
Shares in the $147m market-capped explorer are up 22% today, trading at 11c.
While Brightstar Resources and Arafura Rare Earths are Stockhead advertisers, they did not sponsor this article.
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