Resources Top 5: Miner IGO makes ‘well timed' $1.4bn lithium acquisition as IPOs continue to impress

Miner IGO surges after announcing $1.4bn lithium acquisition
Relisted explorer Sunshine Gold goes as high as +220% in early trade
Copper focused Kingfisher having a great first day on the ASX, up +40 per cent

Here’s your top ASX small cap resources winners in morning trade Friday, December 11.

IGO’s (ASX:IGO) deal to buy a $1.4 billion stake in the big Greenbushes lithium mine and processing facility in WA from lithium giant Tianqi is a hit with investors.

The gold-base metals miner came out of a week-long trading halt this morning, jumping +23 per cent to pare much of its losses over the past year.

First announced on Wednesday, the deal will see IGO get a 24.99 per cent interest in Greenbushes — the largest, lowest cost rock lithium mine in the world – and a 49 per cent interest in Australia’s first battery grade lithium hydroxide plant in Kwinana.

The deal will be completed in the June quarter next year. This is a well-timed acquisition in the lithium cycle, IGO boss Peter Bradford says.

“This is a genuinely transformational transaction for IGO and one that delivers on our strategy to become a global leader in the supply of metals critical for enabling a clean energy future,” he says.

“Both Greenbushes and Kwinana are world-class assets with attractive growth profiles that together provide the platform for building a global lithium business.”

Former long-time shell company Pelican Resources is back on the bourse with the bang as gold explorer Sunshine Gold (ASX:SHN).

The small cap stock has already gained +220 per cent in morning trade.

Its main game is two Queensland projects called Triumph and Hodgkinson.

A drilling program is now underway at Triumph’s advanced Bald Hill prospect where previous drilling hit thick, high grades like 12m at 13.42 g/t gold.

Another IPO hits the bourse with big gains

New copper explorer Kingfisher Mining (ASX:KFM) is up ~40 per cent in early trade after raising $6m in an oversubscribed IPO.

The initial focus for drilling in Q1 next year will be the Boolaloo project in WA, where potential for a big discovery was established by previous drilling at 6 of the 22 identified targets, the company says.

The remaining 16 targets are yet to be drill tested.

Carpentaria Resources (ASX:CAP) says super high grade iron ore from its Hawson project in NSW will translate to more efficient steel making, which lowers environmental and energy costs.

But unlike many other iron ore juniors this year, Carpentaria hasn’t been making much headway – or share price gains – and some shareholders want a change.

A meeting has been set for December 30 to vote on the removal of Paul Cholakos as a director of the company.

John Lynch from Exelmont is one concerned shareholder “frustrated with the perceived lack of development of the Hawsons Project”.

“I am concerned at the numerous capital raisings since September 2016,” he says.

“I am concerned with costs, especially expenditure on several consultants in the past few years. I am concerned with the performance of the company as indicated by the company’s share price. Therefore, as a concerned shareholder, I wanted change.

“This is a very positive environment for iron ore at the moment and Carpentaria should be making the most of this opportunity.”

Up on no news was uranium project developer Lotus Resources (ASX:LOT).

Lotus’ Kayelekera project in Malawi – purchased from fellow Africa-focused Paladin Energy (ASX:PDN) in March – will cost just $US50m to get up and running, the company says.