Resources Top 5: Lithium pivots, rare earths favourites and a mystery mine acquisition

Drilling at the Mt Monger Resources’ East Laverton project confirms shallow, clay-hosted rare earths
Former iron ore play Burley Minerals buying lithium projects in Canada and WA
Polymetals Resources is running the ruler over a mothballed polymetallic mine in Australia but won’t say which one

Here are the biggest small cap resources winners in early trade, Thursday November 17.

MT MONGER RESOURCES (ASX:MTM)

Rare earths sentiment is through the roof and MTM is the latest to benefit.

Drilling at the explorer’s East Laverton project has confirmed the presence of shallow, clay-hosted rare earths “potentially extend[ing] over a very large area, most of which is still untested by drilling”.

The results from the Pt Kidman prospect contain a significant proportion of valuable heavy (12%), magnet (24%) and critical (23%) rare earth oxides at clay thickness intervals up to 12m, the company says.

Higher grades hits include 8m @ 1,467ppm TREO from 22m and 6m @ 1,880ppm TREO from 12m.

But there’s a lot more to find here, with this drilling only testing a small part of the prospective area, MTM says.

A new drilling program to test additional REE targets at Pt Kidman has been provisionally approved by the Traditional Owners of the area, pending site clearance process.

“We are excited by the scale of this opportunity – the mineralisation potentially extends over a very large area, most of which is still untested by drilling,” MTM managing director Lachlan Reynolds says.

“We are also very pleased to see that the mineralisation ‘basket’ of elements contains a significant proportion of the higher-value heavy and critical rare earth elements.

“This is important for the potential viability of any new discovery, and we are keen to do more work to home in on the best parts of the system.”

BURLEY MINERALS (ASX:BUR)

BUR is the latest stock to pivot into battery metals, buying the Chubb lithium project in Quebec, Canada, and the Mt James and Dragon lithium projects in WA.

Punters loved the news, sending the $12m market cap stock to near-record highs on strong volumes.

Drilling has already confirmed ore-grade lithium hits in shallow, multiple parallel dykes 560m long and 240m wide at Chubb.

There’s plenty of upside, with the so-called Main Dyke remaining ‘open’, and drilling from the 1950s hitting un-assayed mineralisation to the south.

The projects in the Gascoyne region of WA are in the same neighbourhood as the Yinnetharra lithium project recently acquired by Red Dirt Metals (ASX:RDT).

While the acquisition is progressing BUR will model existing drilling at Chubb and start the permitting/tendering process for infill and extensional drilling, which will commence upon completion.

All data available in relation to the Gascoyne projects is being evaluated “and a suitable geochemical and mapping program is being devised to rank and prioritise targets warranting further investigation”, managing director Wayne Richards says.

“The strategic and geographic location of all three potential projects are located in world class mining provinces and in Tier 1 jurisdictions of Australia and Canada,” he says.

“The acquisitions present the opportunity for value accretive exploration and the potential development of forward-looking battery minerals projects at a time of record lithium prices.”

VICTORY GOLDFIELDS (ASX:1VG)

The recent rare earths standout is embarking on drilling an alkaline igneous intrusion at North Stanmore – referred by industry experts as “engine rooms for rare earth elements and critical metals”.

This hard rock target is separate, but potentially related to the high grade clay-hosted discovery 1km away announced earlier this week.

“Victory’s technical team believe that the company’s ionic clay rare earth discovery to the south is likely to be related to the alkaline intrusion as geochemical data from the initial diamond hole has confirmed similar ratios of HREE/TREE,” it says.

“In addition, both systems have similar elevated Nb/Ta ratios typical of mantle plume magmas.

“To assess the extent of country rock alteration adjacent to the intrusion, angled drill holes are planned to recover samples of the fenite that are altered rocks occurring adjacent to alkaline intrusions which commonly also host REE and critical metal mineralisation.”

This three-hole drilling program will kick off immediately, 1VG says.

POLYMETALS RESOURCES (ASX:POL)

(Up on no news)

The West African gold explorer is currently running the ruler over a mothballed polymetallic mine in Australia but won’t say which one.

An announcement appears imminent.

“Polymetals has progressed due diligence on an Australian exploration and production asset which is currently on care and maintenance and has, in-principle, agreed the key commercial terms to acquire the project,” POL said November 10.

“The proposed transaction provides an opportunity for growth and diversification for the company with legal documentation well advanced but remaining subject to any regulatory approval that may be required.

“Further details of the proposed acquisition will be announced in due course.”

PARABELLUM RESOURCES (ASX:PBL)

PBL says it is developing one of the latest rare earths deposits in the world in Mongolia, called Khotgor.

Undeterred by the exotic jurisdiction investors have piled into the stock, sending it up 200% since the deal was first announced in August.

In an update today PBL says a mineral resource is “well progressed” for a Q1 2023 release.

Metallurgical test work (the amount of metals/mineral that can be extracted from the ore) is also going well, it says, with initial floatation work achieving 95% REE recovery into a concentrate.

Hydrometallurgical test work is now underway to produce an intermediate carbonate or chloride product, prior to final REO/NdPr separation, PBL says.

The next phase of test work will be undertaken early in the new year to focus on production of individual REO oxide streams, with a focus on the NdPr mineral suite.

The current schedule is to complete all metallurgical test work during Q1, 2023 for inclusion in a Scoping Study, to be available by late Q1, 2023.

“I am really pleased to inform shareholders that the Scoping Study work is progressing very well, and the metallurgical test work results achieved to date continue to support our view that the Khotgor Project can be developed into a significant rare earth operation,” exec director Peter Secker says.

“Over the next few months, we will continue to keep shareholders informed as to operational progress across the various work streams.”

Global REE market fundamentals continue to remain robust with a predicted CAGR growth of 12% between 2021 and 2026, he says.

“The PBL board feel confident that the outcomes will demonstrate a robust project set amongst a backdrop of strong pricing in REE markets that remain highly constrained outside of traditional supply coming out of China.”