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Mining
Here are the biggest small cap resources winners in early trade, Wednesday February 22.
The explorer is buying a lithium brines project in the US, near advanced project developer Anson Resources (ASX:ASN) in the Paradox Basin of Utah.
Fellow lithium brines developer Galan Lithium (ASX:GLN) will also buy a 5% stake in MAN for $1.5m and “provide technical support”.
The ~226sqkm Utah project was pegged by MAN internally, meaning there is no acquisition cost to reduce its cash position or dilute existing shareholders.
MAN is already well advanced in compiling geological and petrophysical data ahead of a potential lithium exploration target “in the short term”.
This will guide exploration work toward a maiden resource in the second half of 2023, it says.
“Our 100%-owned Utah Lithium Project comprises over 56,000 acres of prime lithium brine prospective ground in the Paradox Basin in proximity, and incorporating a multitude of dormant oil and gas wells that can be relatively quickly and inexpensively accessed for the purposes of sampling and eventual production,” MAN managing director James Allchurch says.
“The Paradox Basin includes nearby operators such as lithium developer Anson Resources (ASX:ASN), who have a mineral resource of over 1Mt of lithium carbonate equivalent at an average grade of 124mg/L, as well as the biggest potash producer in the US, Intrepid Potash.
“The opportunity presented by Mandrake’s large-scale Utah lithium project is clearly recognised by ASX lithium developer Galan Lithium (ASX:GLN; MC: $344M) who are investing $1.5 million for a 5% stake in Mandrake and will be involved in the project on an ongoing basis in a technical advisory capacity.”
The $36m capped stock is tremendously well funded with $19m in the bank, post GLN placement.
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AZI’s main game is the historical Gorno zinc project in Italy, where it recently inked a $103m JV funding deal with Appian.
Appian can earn up to 67.4% of the project by funding +20km of drilling, a DFS (the most advanced of project studies) and $87m for project construction – “an amount sized to fund the expected project financing equity component for Gorno”.
The drilling campaign – designed to add metal to the 7.8Mt inventory and increase confidence in the current resource — is well underway.
Initial results like 5.3m at 14.5% zinc, 4.8% lead and 60g/t silver near the southern limit of the current resource indicate the high-grade portion of the resource “may be more extensive than previously thought”, AZI said earlier this month.
A late 2021 Scoping Study ascribed a net present value (NPV) of US$211 million ($297 million) to the project.
The US$2,850/t zinc price used in the study compares with over US$3,100/t today.
The company also has exposure to battery metals projects in Italy, including the ‘Punta Corna’ cobalt project and lithium projects neighbouring ground held by Vulcan Energy Resources (ASX:VUL).
$30m capped AZI is flat year-to-date. It had $5.7m in the bank at the end of December.
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PR1 listed on ASX April last year with a bunch of WA gold, nickel and copper projects, before pivoting to lithium, like everyone else, in November.
The explorer is now up 80% on its IPO price of 20c per share, thanks to a portfolio of early-stage lithium claims in Quebec, Canada.
That includes the 261sqkm LaForge project, ~65km from Patriot Battery Metals’ (ASX:PMT) high grade Corvette discovery.
PR1 has secured the services of a North American lithium specialist who is hunting for more acquisition opportunities.
Meanwhile the company is still working on its WA projects, with results of a 2800m drilling campaign at the Mount Monger gold project in December to be released to the ASX “once they are available”.
PR1 has $3.1m in the bank at the end of December.
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PRX has been exploring the gold-rich Tanami region in the NT for decades, over that time building a portfolio of very interesting projects.
So interesting, in fact, that the majors came calling. It now has three joint ventures with IGO (ASX:IGO) over the Lake Mackay project, and two with US listed Newmont over the Tobruk and Monza projects.
Newmont, the world’s biggest gold miner, can earn 70% of Tobruk by spending $12m on exploration, and 51% of Monza by spending $6m on defining an inferred resource.
PRX also has a bunch of wholly owned projects, which are self-funded.
A recently announced 54,000oz resource at the Tregony deposit means the company now has 1Moz gold in inventory.
The $25m capped stock is up 20% year-to-date. It had $8.1m in the bank at the end of December.
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The Chalice Mining (ASX:CHN) spinout surged on high vols last week after reporting multiple high grade gold hits at Ironbark East, part of the flagship Pyramid Hill project in Victoria.
Highlights include 12m @ 6.18g/t gold from 74m, including 1m @ 52.9g/t from 77m – the highest-grade gold intercept to date at Pyramid Hill.
The drill program was focused on infilling around last year’s program which hit 40m @ 2.8g/t Au from 50m, including several 1m intercepts above 10g/t.
FAL has now defined high grade gold over 400m at Ironbark East. A program of more than 50,000m across the wider project remains on track to complete in May.
“Intersecting high-grade mineralisation at Ironbark East over a 400m strike length is a great result and provides us with encouragement ahead of the commencement of our diamond drilling program later this month,” FAL managing director Tim Markwell says.
“The results at Ironbark confirm the potential of diorite to host economic zones of mineralisation, especially with the intersection of a new zone at Ironbark Central announced earlier this month.
“Our success to date gives us the confidence to further ramp up our activity at Pyramid Hill and we look forward to putting out more updates over coming weeks.”
Pyramid Hill was CHN’s No 1 focus before it hit the motherlode at Julimar, and is highly prospective for high-grade gold deposits like the nearby, world-class Fosterville mine.
According to the Victorian government there’s 32Moz of undiscovered gold in the North Bendigo zone where FAL has a dominant landholding.
FAL is notably chaired by Mark Bennett, discoverer of the Nova nickel discovery.
The $60m capped stock had a massive $23m in the bank at the end of December.
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